PESTEL (II) : Economic Environment

1. Economic environment is an important influence at local and national level.

2. The forecast state of the economy will influence the planning process.

3. In times of boom and increased demand and consumption, the overall planning problem – to identify the demand.

4. In times of recession, the emphasis will be on cost-effectiveness, continuing profitability, survival and competition.

5. There is a constant and large scale interaction between the government and economy through the various aspects of government economic policy.

6. Local and national economic factors are Overall growth or fall in GDP, Local economic trends, Inflation, Interest rates, Tax levels, Government spending and The business cycle.

7. International economic factors are Exchange rates, Characteristics of overseas markets, International capital markets, Large multinational companies, Government policy on trade/protection.


(source: BPP Learning Media)




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