PESTLE Analysis – A Simple Tool to Spot What’s Coming

PESTLE is a way to look at what’s going on outside your business.
It helps you understand changes that could affect your plans, people, customers, or profits.

It stands for:

• P – Political

• E – Economic

• S – Social

• T – Technological

• L – Legal

• E – Environmental

P – Political

These are changes in government, laws, or policies.
Ask:

• Are there any new rules or taxes?

• Is there political unrest or change?

Example: a new trade deal, a change in business rates.

E – Economic

This looks at the wider economy.
Ask:

• Are interest rates going up?

• Is inflation or the cost of living rising?

Example: a recession, wage increases, fuel prices.

S – Social

This is about people and society.
Ask:

• Are customer behaviours changing?

• What trends are affecting work or lifestyle?

Example: ageing population, remote working, changing values.

T – Technological

This is about tech and innovation.
Ask:

• What new tools or systems are emerging?

• Is automation or AI affecting the industry?

Example: new software, e-commerce, smart devices.

L – Legal

This is about laws and regulations.
Ask:

• Are there new health, safety, or employment laws?

• What rules do we need to follow?

Example: GDPR, minimum wage laws, new compliance rules.

E – Environmental

This looks at climate and green issues.
Ask:

• Are we under pressure to be more eco-friendly?

• Could weather or climate rules affect us?

Example: waste rules, energy costs, net zero goals.

Why Use PESTLE?

• Helps you spot risks early

• Shows where opportunities might be

• Keeps your strategy up to date

• Makes sure you’re not caught off guard

Top Tip

Review your PESTLE regularly — at least once a year or when something big changes.