External Environment Analysis

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Abstract This report is compiled to analyze and understand the outdoor sportswear market in the I-J. It Is compiled to provide the reader with the information that affects the market via a PESTLE analysis, as well as its market size In the UK. Based upon data from previous years of this particular market, provided by a market report done by Keynote, I have also calculated a fairly stable growth forecast for the industry.

This report Is conducted by doing a PESTLE analysis to Identify in particular two factors that have can considerably impact a UK based business including its future thin the next three years which are a good indicator whether the business will be successful or not. By doing the PESTLE analysis, I have come to the conclusion that the following two factors that will have a large Impact, the first being Social and the second being Economic. With regards to the social aspect, the lifestyle of most people in the last 10 years has vastly changed to being a more active society.

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The views of others on outdoor activities and the health issues that have arisen in many people that have caused people to change their lifestyles and the Importance of these hangers. From the economic perspective In the past 7 years the world economy hasn’t been the best hence affecting the disposal income of consumers. The scope of the product has to be looked at to analyses Just how successful the business will be. Finally, the demand of the product will have an adverse affect on the success of the business. For this report, it was also important to explore the opportunities of such a business where there is profit to be made.

First being a route into manufacturing adventure gear that can be used In conjunction with their clothing. Secondly, being an outdoor clothing company, they could go into supplying their outdoor gear to adventure camps that can use them. I have also analyses 1 main threat to this business being competition from established brands. 1. Introduction 2. PESTLE Analysts Social Lifestyle Changes Health Issues Education Importance of Information Economical Consumer Disposable Income Product Scope 3. Conclusion Opportunities Outdoor Adventure Gear Outdoor Gear Rental Threats 5 6-7 8 Competition From Established Brands 4.

Figure To Summarize Key Findings 5. Appendices 6. References 6 10 11 9 For this report as mentioned earlier in the abstract, an estimate for the outdoor adventure clothing market size has been ascertained as well as a fairly accurate estimate of the next 3 years in the industry. Source: Key Note Figure 1: The UK Market for Sportswear by Sector by Value at Current Prices (Me at rasp). 2008-2012 From the above diagram, we can ascertain that sports clothing occupies majority of the sector of sportswear. In 2012, sports clothing made up E. 23 billion, roughly about 71% of the market of which, outdoor pursuit wear made up IEEE million roughly 26. 1% of the sports clothing market. Key Note) Between 2010-2012, there was an average increase in the sports clothing market of 3. 63% per year and hence a 0. 58% increase per year in outdoor adventure clothing (Key Note, 2013), using this value, the forecast for the following three years 2014, 201 5 and 2016 would be Multimillion, Multimillion and Multimillion respectively, this would only be possible if there is a stable growth in the industry.

The growth in this sector of the industry has been fairly consistent over the last 4 years and from this I can take that the growth in the following years along with the change in lifestyle of nonusers and the growing economy that the growth will be fairly stable in the years to come. PESTLE Analysts In recent years, the world in general has changed its attitudes to being healthy, many more people are more careful about their eating and exercising habits. Society as a whole has become much more active and more healthy especially due to the increase in people with obesity and heart problems and generally more health issues in the last arrears.

This has led to people taking up many more sports, walking more, watching what they eat and making more effort outdoors (I. Hiking, climbing etc. ). Another main influence in lifestyle changes is the fact that more and more people are taking advantage of the outdoors for example climbing mountains such as Kilimanjaro for charity this means that people are more open to taking up outdoor Between 1980 and 2008, mainly due to bad diets and fast food, the number of individuals who are obese has increased at an alarming rate, so much so that currently “In the I-J, 64% of adults are classed as being overweight or obese. (BBC, 2014) this has caused a massive increase in the number of individuals suffering from ailments such as diabetes and more serious problems such as heart problems leading to heart attacks and strokes. This has led to people taking more steps to avoid these health issues, which has led to a more active society and more outdoor activities taking place.

To avoid obesity in later life, schools are emphasizing on educating the students on the dangers of obesity and the problems that can occur in later life, this is done in a number of ways first controlling what they eat by changing canteen food and this is also done by out of school camps where the students take part in outdoor activities ND this means that by manufacturing outdoor clothing the market in which this business will operate will be much wider and hence will mean that the company has a higher chance of success.

Importance of Information Due to the change in individual’s lifestyles, the rise in certain health issues that are caused by the lack of exercise and the resulting increased activity in the society such as more outdoor activities would be ideal for this company to be able to achieve success as they are able to target their product to a much larger field of individuals. Disposable Income of Consumers Due to the current global economical situation, it is most important for the business to consider its pricing of its products. Due to the recession, many individuals have been made redundant and as a result have had to find lower paying Jobs.

As a result has their disposable income has Ben reduced. As a result, the incentive to take part in certain activities such as going to the gym has been greatly reduced and as a result these individuals have turned to outdoor adventure activities such as hiking and climbing to keep themselves active. This is important to the business as due to reading their own material, this gives them the ability to offer a product at a cheap yet profitable price and as a result this will attract more consumers especially those who have a lower disposable income and as a result this will lead to a larger demand for this product.

There are many different companies in this particular sector. However, these companies generally use a generic material like Greeter O. This business has the advantage of being able to use its own produced material and as a result its costs will be significantly lower and this will allow for the business to undercut its interiors and be able to offer their product at a lower price and as a result be able to increase their product demand this in turn will allow for the business to be successful.

Conclusion This business will be able to further diversify if their self-built material is “significantly better” than their competition as this will allow the business to expand into manufacturing items that make use of the properties of its material such as tents. This would be an opportunity to the business, as this would allow them to market their products as this would appeal to a wider audience and lead to an increase in product demand. In the current society, most outdoor adventures are planned many weeks/months in advance.

However, most individuals only buy items for that particular trip and never use them again. Therefore, it is viable to the business to rent their gear out to individuals who will use it for that particular time, this will lead to a greater demand for services and will also reduce their costs as they will not require to build as many items. As this is a new company, they will have to contend with the existing established rand’s in their current market sector such as Guestroom & North Face.

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