Every human consumes food. Investors are eager to assess the situation before investing in this business, owing to the growing competition in this sector. PepsiCo's PESTEL/PESTLE Analysis - Recommendations. This shift cant be taken in a negative connotation, but the industry must recognize the shift for future concerns. The farms today are more like industrial facilities rather than family farms. Innocent currently uses 100% recycled plastic in its bottles and is also further seeking to find new ways to reduce any negative impacts on the environment (Innocent 2017). As a result, the demand for food and beverage products has increased significantly. All these segments join together to form the food and beverage industry. This has caused the demand for fast food to decrease. However, the population of the US is getting richer. Available at: https://bizfluent.com/info-7911098-restaurant-pest-analysis.html (Accessed 26 June 2021). The top 5 companies that are covered in this article are. The effective tax rate total range has deteriorated. However, by continuing to improve its manufacturing processes and use of resources, Innocent can offset any potential costs by reducing areas such as wastage and water use. The food and beverage industry is an ever-growing industry. As an industry crosses the growth stage, it enters the shakeout stage. Everybody in the organization must clearly understand and accept this. In the US, pandemic prepared certification is being provided by AIB International which ensures employees and the customers that the particular company is establishing best practices in this pandemic. Well, let me tell you. Available at: https://pestleanalysis.com/pestle-analysis-of-the-food-industry/ (Accessed 26 June 2021). To recap, we first conducted the industry life cycle to analyze different stages of the food and beverage industry. This factor of Porters five forces model analyses the competition in the industry. Businesses must take care of cleanliness and hygiene while carrying out cooking, packing, and delivering operations to abide by the guidelines related to health and safety. Because it causes diabetes, higher blood pressure, and other health issues. There are broadly two categories, fast food, and casual dining. The technological external factors significant to PepsiCo are as follows: Based on moderate research and development (R&D) investments in the industry, PepsiCo can boost its own R&D investments to improve its competency in this business aspect. The buying power in the food and beverage industry is really high since buyers can switch to different brands because of low switching costs. Copyright by Panmore Institute - All rights reserved. As people of the US possess a busy lifestyle so they opt for ready-to-eat food products. But it is contrary to Trumps policies and is engaging agriculturalists to work with the president on expanding trade. Economic factors. A lot of food is wasted by the food and beverage industry. However, it is said that the first restaurant ever established was in 1765. A PEST analysis of food delivery and other aspects of the food industry shows that there are lots of positive policies and programs in the country that you can take advantage of as a restaurant owner to improve your bottom line while helping the nation achieve its overall goals. 'An Example of Pestle Analysis of a Restaurant | Marketing Tutor', Marketing Tutor, [online]. The company needs to implement the data gathered by PESTEL to gain the maximum benefit. This factor discusses how threatened companies are from getting substituted by customers. The growing population and its increasing demand, sensitivity towards transgender employees are some other social factors directly or indirectly influencing the restaurant industry. US does not impose testing on GMO products. Proactive guidance is being made to increase crop yields as it is beneficial for biodiversity. After that, manufacturing and packaging took place in the food and beverage industry. Companies in the food and beverage industry are doing the same. Fast food restaurants are adding "healthier options" on their menus as public health policies are pushing for foods with lower sodium and sugar intakes. PepsiCo must develop strategies that enhance its abilities to withstand the external factors in its remote or macro-environment. The industry will observe financial losses till the war doesnt stop. After that, an industry reaches the growth stage. PepsiCo remains one of the strongest companies in the food and beverage industry. Based on the Restaurant Industry PESTEL analysis, one can say that the company has lost its initial glory. Today the dining options are abundant, so the competition between them is pretty stiff and intense. Growing labor costs can be a matter of concern for the restaurant industry. By reducing its carbon footprint, Innocent may assist in addressing the issue of climate change which may create adverse weather conditions and impact on harvests of fruit and vegetables. Taxation that affects the purchase and quality also influences the industry. Besides providing food, it generates economic activity and jobs for millions of people. Amazon PESTLE Analysis Example. All work is written to order. This analysis on critical, current and future is made through detailing which is called SCPT. Food quality and hygiene criterion are two crucial factors that come under the product safety of the legal factors. Our main markets are Russia, Eastern Europe and The Middle East. 'PESTEL-PESTLE Analysis of Restaurant Industry | Free PESTEL Analysis', PESTLE Analysis, [online]. A global recession is predicted soon, which will reduce the purchasing power of the people. Labor laws for workers at the restaurants have been given by FLSA ( Fair Labor Standards Act ). Lets move ahead and analyze how competitive the food and beverage industry is. Here are the Economic factors impacting the food industry: As a general trend, the worlds population is only getting richer. The restaurant industry is the most profitable since food is a basic necessity for survival. The economic situation in the UK can impact on the sales of Innocent smoothies and juices due to their premium price and the availability of cheaper substitutes. It might affect the growth of the restaurant industry in the coming years. It would result in the form of more profitability and less human error. In relation, PepsiCo can improve its waste disposal strategies, such as recycling, to gain more support from customers. Technological. Automation is the future of the restaurant industry. This PESTEL/PESTLE analysis indicates that the company has many opportunities and a number of threats regarding its growth and international expansion. These factors include issues such as the rulings and guidelines from government bodies on nutritional information on food and drink (Food and Drink Innovation Network 2016 . For example an Industry may be highly profitable with a strong growth trajectory but it won't be any good for National Beverage Corp. if it is situated in unstable political environment. Since the food and beverage industry is responsible for generating economic activity, providing food, and creating jobs. This emission is expected to increase up to 30-40% by 2050 due to the rising population. The yet president, Bidens approach towards trade and payment is still unclear. The article explores each force in-depth and tries to decipher its impact on the business already operating within the food industry or aspiring to internationalize their company within the USA. Their lifestyles are below the standard as compared to the rest of the US population. The PESTEL/PESTLE analysis model can be used to satisfy this need. In this PESTLE analysis, we'll look at the Political, Economic, Sociocultural, Technological, Legal, and Environmental factors affecting the food industry; in particular, we'll look at how both restaurateurs and food distributors might be affected by current trends. The international brands who want to join US Food Industry must know that investing in automation would benefit them and will be fruitful for the industry as it would attract a wider customer range, bringing economic boosts. The Internet, globalization and . Our team consists of highly skilled Business Analysts, Project Managers, and Content Writers. The partnership with Coca Cola in 2009 was subject to UK competition laws. PepsiCo can also take advantage of the busy lifestyles of consumers, especially in urbanized and industrializing markets around the world. The companies in the food and beverage industries face a great threat of substitution since many companies offer similar products. Hence, there is always an option to switch suppliers. The decline stage arrives after the maturity stage. Since this industry is huge, it provides employment to around 22 million workers. They have created awareness videos that guide one about reducing food wastage, eventually saving money. They now avoid spending more money on luxury food and beverage because of the limited income. A food business should follow these trends and launch its online platform in order to attract more people. Factors including innovation, automation, technical awareness, and more influence the production, distribution, and communication operations of a business come under the technical parameters. Means (strength, challenges, prospects and threats). The health and safety-related policies affect the restaurant industry the most. Nonetheless, all businesses are controlled by these external factors. Economy recovery efforts were drawn through stimulating funds. This report . Hence, the food and beverage industry will suffer. This impacted the US food Industry. The beverage industry contains two main categories, and each of them forecasts to reach a positive number in market value: Non-alcoholic segment : USD 1.60 trillion by 2025 (according to Intrado GlobalNewswire, 2020) Alcoholic segment : USD 647.7 billion in 2023 (according to Grand view research, 2017) We've received widespread press coverage since 2003, Your UKEssays purchase is secure and we're rated 4.4/5 on reviews.co.uk. The employees below 20 years are to be paid above 4.25 dollars per hour in the initial three months of employment. This can include research, collaboration and education along its supply chain (Leahy 2016). The life cycle of every industry is divided into five parts. Without a doubt, this makes the food industry one of, the most tightly-regulated industries of all. Innocent must comply with the legal framework of the UK including taxation, health and safety and food manufacture laws (Food and Drink Innovation Network 2016). It is the first factor of the model. PESTEL analysis restaurant industry predicts growth opportunities as well as a potential threat for the industry. As the industry is growing, more food outlets have been established worldwide. In this element of the PESTEL/PESTLE analysis, it is shown that PepsiCo can focus on product innovation to comply with regulations. However, the current slowdown of the Chinese economy threatens PepsiCos potential international growth, considering that China is among the biggest economies in the world. Disclaimer: This work was produced by one of our academic writers to help university students with their studies. These steps can help you get back, Copyright 2020 Weberience LLC. 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