Businesses continuously look for new markets. Before committing resources to investment in a new market or launch fresh product or service, careful analysis of the market is necessary. The study focuses on the factors that are beyond the control of the business yet have a major effect on its success or failure (50MINUTES.COM. et al., 2015). In the case of Giant TMC Berhad, the three most important macro environmental factors to consider are political, economic and technological.
Political Factors
Governments provide regulations that must be followed by people in business. These laws vary from one country or region to another. The political environment may be favorable in one country or location and hostile in another. Any person in business should consider such regulations and their impact on their operations. It can be tough and frustrating to operate a business in a country where the authorities do not offer support to new enterprises (50MINUTES.COM. et al., 2015). Tax policies, political stability and access to government contracts are some of the political issues to consider.
The main factors to consider under the political factors are tax policies and the political situation. Governments get their revenue by taxing income earners both businesses and individuals. Some tax regimes are considered too harsh and do not the growth of business (Cartwright, 2002). Giant should examine the tax policies used by both the federal and regional authorities in Australia since taxation will affect their profits and cash flows. Some governments attract new investors by offering tax holidays.
Politics plays a significant role in the conduct of business. Democracy allows people to form or join parties that usually have differing views on various issues. The stability of the political scene is vital since it creates a less volatile environment to thrive. Australia has not encountered significant shifts in its political landscape, and this situation is likely to continue (Davies and Ellison, 2005). Therefore, investors such as Giant can be assured of a stable future.
Economic factors
Traders seek new opportunities so as to increase their economic fortunes. Economic booms and recessions are unpredictable, and they determine how a business runs its affairs in the present and future as well (50MINUTES.COM. et al., 2015). Enterprises can also be affected by the economic condition of the rest of the world. The main issues under economic factors for Giant to consider are inflation and global economic trends.
Inflation erodes the ability of consumers to buy goods or services. Governments formulate policies to help control the rise in consumer prices. Australia has an excellent record of its inflation levels as it still attracts the rest of the world for trade (Posner and Applegarth, 2014). Thus, new businesses are assured that the purchasing power of Australian consumers will remain high in the predictable future.
No country is an island, and business interactions with other nations are necessary. The general global economic condition can affect business in a given country (Warner, 2010). Trading with other nations provides a source of better-priced goods which boosts profitability and enhances cash flow for investment purposes. The global economic condition is turbulent but at the moment, it is on a stable course.
Technological Factors
Technological developments are changing the way businesses are conducted. Companies are embracing technology and aligning their operations to the changes with the aim of improving efficiency in their activities (Posner and Applegarth, 2014). Utilizing the right technology helps businesses have a competitive edge over the rest of the market. Identifying the technology to use and its relevance to the future are the main factors to consider.
Technology is very dynamic, and changes occur within a very short time. Although there are very many options for a given purpose, not all of them are suitable. It is the task of the buyer to identify the most appropriate options and avoid all others (Davies and Ellison, 2005). Before investing in any option, it has to be tested and proved to be the best about the needs of the buyer.
Technological advances can become obsolete very fast. The kind of developments to be bought by Giant for their operations should be useful shortly. Instead of buying something new after a few years, it is advisable to invest in an option that has room for growth and improvement (Posner and Applegarth, 2014). It should allow adjustments to accommodate any new needs of the customer. This approach will eliminate the high cost of investment and avoid disruptions caused by overburdening of old systems.
Giant TMC Berhad has an excellent opportunity to succeed in the Australian market. Although the market is new and will offer challenges like any other, the macroeconomic factors are not hostile. The political situation is stable, and significant shifts are not anticipated shortly (Warner, 2010). Many other businesses have successfully started their operations there in the past which means Giant can also succeed after conducting the necessary research of the market.
The Australian market is strong with favorable economic policies. Consumers in the country have a high purchasing power which provides a ready market for the business to thrive. However, thorough analysis of the market needs to be conducted so as to have strategies that will give an edge over the competition (Cartwright, 2002). The experience gained in another market is crucial in getting a share of the market and grow its customer base.
In conclusion, market research is necessary before business ventures into new frontiers. The conditions of one market are different from any other. It is, therefore, important to conduct the PESTLE analysis to determine if the idea is viable or not. Having succeeded in other markets, there are high chances for Giant in the Australian economy.
Reference List
50MINUTES.COM., minutes, 5., Feys, B., and Probert, C. (2015). PESTLE Analysis. Primento Digital.
Cartwright, R. (2002). Mastering marketing management. New York: Palgave.
Davies, P., and Ellison, L. (2005). Strategic Direction and Development of the School. London: Taylor and Francis.
Posner, K. and Applegarth, M. (2014). Project Management Pocketbook. New York: Management Pocketbooks.
Warner, A. (2010). Strategic analysis and choice. New York: Business Expert Press.
