The PESTLE analysis deals with the following aspects: political factors, environmental factors, social factors, economic factors, and legal factors that are beyond business influence and control. However, these factors are very fundamental when undertaking strategic planning, product development, or any business planning. PESTLE analysis ensures that the business is well aligned with changes in powerful external forces affecting working environments by taking advantage of the changes to place the business at a competitive advantage and increase its survival rates. PESTLE analysis also helps a business to avoid taking costly actions that are likely to result in failure for reasons which are beyond your control.
PESTLE analysis makes businesses break free from assumptions and develop quick strategies to adapt to the reality of the new environment. It is therefore important that businesses carry out a business PEST analysis to determine the external factors that could positively or negatively affect the business and Canvas magazine is no exception. Canvas magazine is a publication of Mixed media in Dubai media city and publishes art information. Owing to that it has cut its niche across the Middle East and Arab art and culture, it is important that the company be on its toes in identifying macro external factors in order to further boost its success and mitigate the company from external factors that could negatively affect the business (Bensoussan & Fleisher, 2008).
Political factors
Political factors aim to define the level at which the government interferes with business operations or the economy. This can be through environmental law, tariffs, tax policy, labor law, and trade restrictions among other factors. The Dubai Media Law favors Canvas magazine in several ways. The Media industry is a free zone whereby employees are exempted from taxes in regard to media operations and media companies are excluded from capital transfer and repatriation restrictions. This simply implies that Canvas magazine can attract skilled human input just like any other media company. However, Dubai Media companies are expected to pay an annual fee of 5,000 for every title which is usually regarded as a high, and therefore, Mixed media pays an annual fee for the canvas magazines (Bensoussan & Fleisher, 2008).
Economic factors
Since Caravan magazine operated within the UAE market, the UAE economic market seems to be growing and therefore there is likely hood of Caravan magazine increasing its success chances. Since oil discovery, members of the UAE have increased their income. Their GPD level in 2009 was $67 billion and this, therefore, means that Caravan’s magazine potential clients have sufficient money to purchase the magazine and attend the Caravan events and festivals. Nevertheless, the Middle East is the second-largest economy in the world and therefore its chances of growth are high. Most markets succumb to inflation because of poor pricing and inappropriate demand estimations. However, the Middle East and Arab market’s worst inflation rate has been 4.5% which is still said to be good for business persons to undertake their business operations. Nevertheless, the economic meetings and functions held such as Dubai Summer Surprises and Dubai Shopping Festivals are designed to discuss issues pertaining to inflation and how to deal with them (Ahmed, 2004).
Social-cultural factors
The Middle East and the Arab countries are characterized by urbanization whereby cities constitute multiethnic groups and housing is divided in accordance to social power, nationality, ethnicity, and class. Canvas magazine has already identified this and taken advantage of the social-cultural factors by forming a magazine that caters to different religions, politics, ethnicity, and class thereby acting as a unifying factor and enhancing its good corporate governance. Canvas magazine also comes up with global cultural events that incorporate an Arab twist.
Technological factors
Dubai provides up-to-date technological facilities involved in almost all types of businesses including the media industry, mobile stock banking, PDA banking, online banking, computer banking, and the development of hi-tech machinery. This implies that canvas magazine can sell the online magazine to clients and business transactions can be conducted online (Ahmed, 2004).
Legal factors
The government policies set by the Dubai government encourage foreigners and workers to start their own businesses. This simply implies that Canvas is likely to have more competitors but at the same time, Canvas magazine can take this opportunity to expand its operations and cut its niche to potential market segments. Most middle eastern and countries follow GATT and WTO rules which encourage business partnership within countries and this is likely to help Canvas magazine develop a partnership with reputable companies (Canvas Online, 2011).
Conclusion
As we have seen through the Canvas PESTLE analysis, the Middle East and other Arab countries offer a favorable platform through which canvas can conduct its business operations. However, it is good to note that most part of the Middle East is under a common market and hence, most business restrictions barely differ. It is therefore important to ensure that canvas magazines devise a way through which they can pay for the money incurred while paying for the title.
References
Ahmed, M. (2004). Financial services. Web.
Bensoussan, B.E. &. Fleisher, C.S. (2008). Analysis without paralysis: 10 tools to make better strategic decisions. New York: FT Press.
Canvas Online. (2011). Cava. Web.