Pest analysis of business environment

Pest analysis of business environment


In the previous post, we discussed about the analysis of Nigerian business environment using the SWOT as an instrument for analyzing it. Here, we shall be putting an Education and Information searchlight on how to use PEST analytical tool to analyze a business environment.

First of all, you need to know that the word PEST is an acronym for Political, Economic, Social and Technological factors. The roles of pest analysis in determining whether a business in a particular Business environment will succeed or not can never be over-emphasis.

Therefore, it is expected that entrepreneurs should endeavor to check his business environment before major investments are made. Major investment may be in form of starting a new business in or wanting to expand an existing business. Whatever the case may be, this PEST Analysis will give a real picture of how the business environment in a given environment looks like.

Read also: SWOT analysis of the Nigerian business environment

In this post we shall be using a food processing business as a case study so as to give better understanding on the study at hand.

PEST Analysis of a food processing business

The various Political, Economic, Social and Technical factors that a firm needs to consider and research, in order to enter a restaurant business in a new environment are as follows:-


Political Factors


Economic Factors

Social Factors


Technological Factors


In conclusion, PEST analysis is a great way of getting to know the features of an environment before you jump into it. After all, it’s always good to look before you leap!
Read also: Pest analysis of Nigerian business Environment