PEST Analysis Template
Use this online PEST analysis template and make a custom report in seconds. Fill in the blank fields, choose the template you like most, and download the chart.
⚙️ PEST Analysis Template: How It Works
- Get ready with the factors influencing the business.
- Fill in the blank fields of our PEST analysis tool with political, economic, social, and technological factors.
- Use “Add Another” button if the three default fields are not enough.
- Choose the preferred PEST analysis template and color palette.
- Choose the file format.
- Press “Download result” to get the infographic or its sample for free.
đź’» What Is a PEST Analysis?
A PEST analysis evaluates the political, economic, social, and technological factors that currently affect a business or might do so in the future.
This analytical method provides a better understanding of the market where the firm is operating. But most importantly, it helps to prepare for the potential shifts and downward trends.
đź“Š PEST Analysis Template & Its Elements
Below you’ll find a list of factors that might influence a business and are used in the PEST framework.
Political Environment
Political relationships may help or hinder business development. And these are not necessarily military conflicts or newly-created alliances. Minor factors at the governmental level also influence businesses.
- Trade restrictions. This category of political factors is the most decisive. You cannot do business in a country where your product or country of origin is under sanctions.
- Taxation. The higher the taxes, the lower the profit. This factor could be considered economical, but politics decide how much companies will pay as their taxes.
- Employment regulation. Minimum-wage laws, safety at workplace regulations, and pension contributions make your human resources more expensive. This amount will be deducted from your revenue.
- Utility tariffs. Electricity and water bills will always be there with you. The question is, which amount appears on them?
- Political stability. Is the government consistent in the laws they adopt? Is the country at peace with its neighbors? Lack of stability makes planning impossible. Thus, a growing business in a constantly changing environment will face numerous problems.
- Property rights. How expensive or how cheap is property registration in your country? Besides, intellectual property rights can also create much trouble.
- Environment impact regulation. In most developed countries, companies should pay for the environmental impact of their production. The amount is established by law.
Economic Environment
Some political factors become economic ones once they obtain a numerical form. Still, this category is less regulated by laws and more by the existing market situation.
- Crediting terms. How easy or challenging is it to get a credit? What are the interest rate and repayment period? The better the crediting conditions, the more money you can get at the start of your business.
- Investment attractiveness. Are domestic and foreign investors interested in this industry? Are they eager to invest funds into its development?
- The phase of the economic cycle. The economy revolves around four cycles: expansion, crisis, recession, and recovery. Depending on where your country is at, your business will thrive or not.
- Globalization. This factor is the best for your business. It expands the market and facilitates logistics.
- Spending habits. How much are your clients ready to spend on your product, if at all?
- Market situation. This broad subcategory covers everything from the competitive environment to the prices.
Social Environment
Most people don’t wake up in the morning thinking they should buy something from a given company. But what shapes their needs and desires? And what are they ready to do to earn money for the things they need? Social sciences study the factors listed below, answering these questions.
- Tastes and trends. Large corporations can take the risk of creating new trends. Small business usually follows established customer tastes.
- Diversity and equality. An unexpected fact is that rights equality is good for the economy. When all people have equal access to work and good salaries, they earn (and spend) more.
- Wealth distribution. Each business selects its target customers depending on how much they are ready to pay for the product. What is your target audience?
- Job market. People are not only clients. They are also your human resources. Which salary would satisfy them, and how many hours are they ready to work for you?
- Demographics. The growth rate, education, health, social mobility, and aging of the population all fall under this subcategory. These factors affect the characteristics of your target audience.
Technical Environment
Today the technical environment shapes what clients expect from every product.
- Artificial intelligence, robotics, and automation. The availability of these technologies can considerably accelerate your production cycle. Meanwhile, they are quite expensive. Can you afford them?
- Online technologies. A smartphone app and an adaptive website are a must for modern businesses. How expensive are they?
- R&D. Will you be able to invest in research and development to stay ahead of your competitors?
- Work from home. The recent pandemic has discouraged people from working at the office. Besides, it allows companies to pay less for the rental of premises. Is remote work applicable to your business? Which software will you need for that?
- Tech hubs. You won’t thrive in some industries which depend on technological hubs. If it applies to you, consider whether you can afford to locate the business near such a hub.
Thank you for reading this article! If you want to check the extended version of PEST analysis, consider trying our free PESTEL template.
âť“ PEST Analysis Tool FAQ
A PEST analysis explores the current situation in the market in terms of politics, economy, society, and technology. The tool allows business owners and managers to design the most time- and cost-efficient strategy based on the existing factors.
A PEST analysis identifies the political, economic, social, and technological information which can be used for further business analysis. These factors are described as a system and provide a full-scale picture of the industry and its commercial environment.
The four segments of a PEST analysis are the factors represented by each letter of the abbreviation:
- P is for Political;
- E is for Economic;
- S is for Social;
- T is for Technological.
A PEST analysis is traditionally used to prepare for the more general SWOT analysis. It explores the external factors and describes the situation outside a company’s reasonable control. However, its findings are helpful in subsequently defining the internal threats and opportunities of a small business.