What external environmental factors affect Nestle and why?

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Expert Solution

External environmental factors are those factors which are beyond from the control of an organization. These factors have outside influence on the performance of any organization. External environment factors affect or influence an organization from outside. Nestle is the world’s leading food and nutrition company, having worldwide distribution channels. External factors which affect or influenced Nestle are as following:

Economic Factors - economic factors like global recession, inflation, interest rate and consumer behaviour are few examples of economic factors which influence the performance of Nestle. The market will fluctuate with the change in economic factors and will influence the performance of the organization. Nestle believes in sustainable development and also contribute to the welfare of the society.

Technological Factors – technological factors plays a vital role in the today’s fast pace world. Nestle keep itself updated with Morden and developed technology to have a competitive edge on the others. Nestle spends huge amounts on research and development to increase its capability in terms of technology.

Social Factors – social factors like beliefs practises and customs also play a very important role in the success of any organization. as a consumer goods producer, Nestle depends hugely on this factor. Research and development in strategies based on social factors help the company to provide products as per the needs of the consumers.

Political factors – political factors like change in law or regulations also influence the policies and strategies of Nestle. The company have to follow all the rules and regulations of the home country. And have to inform about all the law related to the food and beverage industry for the smooth functioning.

There are many factors affects Nestle operations and influences the success of the business. Company handle these factors very well and emerge as a world leader in food and beverage industry.

ekkarill92 answered 1 year ago

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