PESTEL Analysis: Definition, Factors, Steps & Examples

Running a business means navigating constant changes. From new laws to evolving customer preferences, there’s always a lot to manage. That’s where tools like PESTEL analysis come in handy, helping you stay on top of external factors and supporting your growth and success.

Think of it as a handy guide that helps you understand the outside forces affecting your business.

With PESTEL, you can spot potential challenges and find new opportunities to grow. The PESTEL analysis can be instrumental in evaluating the characteristics and changes in the environment that can affect a company’s success, from which the right decisions can be made at the right time.

Are you interested in using this tool? In this blog, we will explain PESTEL analysis, the important factors it covers, and how you can apply it to your business!

What is PESTEL Analysis?

A PESTEL analysis is a tool that allows organizations to discover and evaluate the factors that may affect the business in the present and the future.

PESTEL is an acronym for Political, Economic, Social, Technological, Legal, and Environment. This unit of analysis assesses these four external factors concerning the business situation and examines opportunities and threats arising from them.

With the results offered by the PEST analysis, it is possible to have a favorable view when carrying out market research, creating marketing strategies, developing products, and making better decisions for the organization.