Country Pest: Mexico
Analysis: An analysis of each PEST category where you consider the impact of the most significant opportunities and threats for your company
Political: Since Mexico has joined the North American Free Trade agreement this would mean they have less restrictions to importing things like chocolate into the country. This would a very significant impact because it means that there are more opportunities for the company Ferrero as opposed to countries that have more trade barriers. However some political threats for the company Ferrero is that the environment is quite unstable and is undermined by bureaucracy meaning it's risky to have business in Mexico because of it's instability in the business environment.
Social & Cultural: In Mexico the population is ranked 11th in the world which could be considered to be quite a large amount of people so that means that there is quite a large amount of consumers. In mexican culture it is part of mexican etiquette to bring and give a box of chocolates to the hostess of where you are invited to and this contributes to the increase of sales in chocolate. Mexico also relies on exports and if Ferrero exports to Mexico and has a large market share in Mexico then they would be a dominant player within mexico. However the problem is that there is a small middle class between the upper class and lower class meaning there could potentially be less people to purchase the products and the result could be that they would need to alter the prices to fit the consumer price range.
Evaluate:
Based on the Mexico's external factors, I think that they shouldn't continue in this country (Mexico) because the political field for business's are unstable meaning it wouldn't be wise to have businesses within the country and the class size difference would affect the product's price for the consumer and profit income for the company Ferrero. Though there are a few opportunities it doesn't seem to be worth the potential consequences that the company would occur when in business in Mexico.
Political: Since Mexico has joined the North American Free Trade agreement this would mean they have less restrictions to importing things like chocolate into the country. This would a very significant impact because it means that there are more opportunities for the company Ferrero as opposed to countries that have more trade barriers. However some political threats for the company Ferrero is that the environment is quite unstable and is undermined by bureaucracy meaning it's risky to have business in Mexico because of it's instability in the business environment.
Social & Cultural: In Mexico the population is ranked 11th in the world which could be considered to be quite a large amount of people so that means that there is quite a large amount of consumers. In mexican culture it is part of mexican etiquette to bring and give a box of chocolates to the hostess of where you are invited to and this contributes to the increase of sales in chocolate. Mexico also relies on exports and if Ferrero exports to Mexico and has a large market share in Mexico then they would be a dominant player within mexico. However the problem is that there is a small middle class between the upper class and lower class meaning there could potentially be less people to purchase the products and the result could be that they would need to alter the prices to fit the consumer price range.
Evaluate:
Based on the Mexico's external factors, I think that they shouldn't continue in this country (Mexico) because the political field for business's are unstable meaning it wouldn't be wise to have businesses within the country and the class size difference would affect the product's price for the consumer and profit income for the company Ferrero. Though there are a few opportunities it doesn't seem to be worth the potential consequences that the company would occur when in business in Mexico.
Works Citedhttp://globaledge.msu.edu/countries/mexico/risk
PWC- Doing Business in Mexico (PDF file)
http://premier.rw3cg.com/content/approved/mexico/premier_frame.htm
PWC- Doing Business in Mexico (PDF file)
http://premier.rw3cg.com/content/approved/mexico/premier_frame.htm