Pestle Analysis Of Miniso In India
Miniso is a Japanese retailer company which specializes in selling home and consumer goods viz. paperwork, toys and cooking goods. The products are inspired from the lifestyle of Japanese. It was founded in the year 2011 by two Chinese entrepreneurs Ye Guo Fu and Japanese designer Miyake Junya. Apart from the fact of being operating in China, MINISO claimed itself as a Japanese brand. Within a very short time period, the company has achieved great heights with its branches in around 40 countries. It is successfully involved in delivering of an affordable collection of curated goods. As a result, it has been challenging the physical pessimists globally. The tag line of MINISO is “let consumers around the world buy better quality products at lower prices”. When MINISO got established initially, there was a decline in the physical economy due to emergence of e-commerce. However, MINISO still performed excellently by providing the consumers with the actual value of the products. Further, MINISO has always focussed on quality improvements. The success of the MINISO is clearly reflected in the number of its stores worldwide which counts to around 6000.
While its establishment in India has been smooth, the retail company still faces many political, economic, social, technological, legal and environmental issues or we can say that if not monitored properly, these factors can hinder the company’s growth in the world. All these factors affecting company’s output and growth can be easily understood in terms of PESTLE analysis.
PESTLE analysis of MINISO
- Political factors– Government policies largely determine the revenue and profits earned by a retail store in the country. The regulations issued by the government are reflected in its impacts on buying habits of consumers, economy of the country, and trade laws at the international level. Any company operating in the country has no choice as far as these regulations are concerned but to strictly follow them. The guidelines related to import, export and selling of products in stores can highly impact the performance of MINISO in India. Tax laws of India, bribery issues can affect the business of MINISO in the country. Moreover, conflict between different parties and political outrages at several times can disrupt the working of the company. Therefore, these issues should be clearly monitored by the appropriate sector of the company for the undisrupted growth of the company in the country.
- Economic factors– When the economy is strong, the consumers can easily purchase the products they want in addition to the products that are needed by them. Contrary to this, when the country’s economy is declining, the consumers start saving the money and invest only on the products that are needed by them and not the ones they wish to purchase to satisfy their desires. During the period of economic decline, people start spending with utmost care, The health of any economy is determined by the gross domestic product (GDP) of that country. Due to the corona pandemic with reduced GDP and economic growth, MINISO in addition to other stores is suffering huge economic setback in its profits. However, MINISO is expected to increase its business and restore its profits once the situation of the country improves. This is clearly reflected from the past performance of the company in India. Moreover, earlier reports before the pandemic claimed the rise in spending of consumers in India to US $4 trillion by 2025. Further, the spending by the consumers will increase more in the food, housing and consumer durable sector in the coming years.
- Social factors- India is a country which houses people from different cultures and races and thus offers numerous opportunities to any company for establishing and gaining profits. The huge variety of products offered by MINISO are likely to be sold and widely accepted in the country due to different choices and demands of the people belonging to different cultures and race.
- Technological factors- Different types of technology is used by MINISO retail stores in the country for registering as well as managing money for business. These are standards for any retail store in the country. With the advancement of technology, MINISO stores are also adopting new systems including better versions of hardware and software. Internet availability and quality has improved in India significantly over the past decade, eventually leading to technological advancement for the company’s growth. Moreover, the introduction of 4G and 5G technology in the industry will lead to further advancement of the handling of finances by the retail stores of MINISO. Further, technological advancement enhances the efficiency and reduces the manufacturing cost of the product which can consequently lead to the growth of MINISO in the country. Apart from the various benefits of technology in the business expansion, MINISO still does not have any e-commerce online store worldwide. However, if MINISO changes its strategies and can come up with its own E-commerce online store, it will provide huge benefit to the customers as purchasing the product will become highly convenient for the customers. Moreover, they can have 24/7 access to the MINISO market which can enhance the sales and exposure of the company to the people in India where the company is still emerging.
- Legal factors- Being a retail business, MINISO is likely to be affected by the retail laws operating in the country. The laws have been framed keeping in mind each and every aspect of the retail. These laws include protecting the interests of the consumers, retailers, sales as well as ensure only constructive criticism in the market. Consumer protection act (2019) which is responsible for resolving conflicts among the seller and buyer related to any purchase of the product can affect MINISO, which being a foreign company needs to abide by the laws more strictly. Other laws that can affect the business of the company in the state include Sales of Goods Act, 1930 and various competition laws. MINISO has to be highly cautious as far as following of these laws is concerned as any conflicting situation can largely impact the company’s reputation and can eventually result in the decline of the profits of the business.
- Environmental factors– As such there are not any direct environmental factors affecting the company in India. However, with the changing environment, the needs and demands of people may diversify which may put an innovative pressure on the company to come up with the supply of consumer specific environmental friendly goods and services. Moreover, the company must always abide by all the environmental laws that ensure protection of natural resources of the country.
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