Sourcing Workshop – PEST Analysis
United Kingdom
Political
* Government lowers taxes to increase consumer spending * Government is investing in UK manufacturing capability * National Minimum wage has been increased by 19p * Political change could be on the horizon due to the upcoming General Election, this will mean new policies
Economic
* 2014 saw the UK Economy reach its best performance since the 2008 recession hit * Bank of England said they showed "no signs" of risking "killing off the recovery, by raising interest rates, anytime soon" * Likely that interest rate rises will be delayed until late 2015 * Wage growth currently outpaces inflation at the fastest rate in 5 years * In the last quarter of 2014, unemployment fell by 97,000 to 1.86 million * After the decline of 2.5% in 2009, the UK clothing retail market increased by 5.3% in 2010 and a further increase has been estimated
Social
* The aging population in the UK is growing significantly, by 2030 the number of people aged 65 and over will have grown 43% * Mass migration has led to a change in the Cultural face of the UK * Fast fashion has enabled a democratic engagement with the luxury of constant novelty, once only the domain of the very wealthy * There is a strong emphasis on appearances and looking the part (being fit, great hair, great style, etc.) Clothing companies need to emphasize that their brand represents all of these things (having models to portray that specific look.) * Children are leaving home later than in past generations * Spending on leisure and holidays has increased by 8x since 1971 * Shopping itself used to be a leisure activity but this has changed massively since advances in e-commerce
Technological
* Only 29% of households owned a computer in 1997 compared with 70% in 2007, and 83% in 2013 * 57,075,826 people in the UK have internet access * Online buying habits are completely changing the fashion and retail landscape * Technological advances have led to a new innovation in digital textile printing, creation of synthetic fibers, development of "Formotion" clothing technology, improvement in safety clothing such as sweat-wicking or fire retardant garments, and creation of "super suits" like that of NASA's Aerogel * Technology has also advanced the marketing aspect of fashion, people today are becoming highly dependent on visual communication and marketing * 7 in 10 people in the UK own a smartphone, which is almost on par with the amount of people who own a Laptop * 1 in 4 people in the UK now shop online on a weekly basis, with 1 in 5 consumers spending more online than in-stores * Research highlights the fashion industry is well ahead of the curve when it comes to engaging the online shopping community * Wifi access in-stores has provided customers with purchasing items that aren’t in stock via the internet whilst still being within the store ambience

Bangladesh
Political
* Real participatory democracy in Bangladesh is a challenge, but something the people want * Bangladesh was named the Most Corrupt Country in the World in 2005, however as of 2012 it is ranked at number 144 which marks great improvement * Islamist extremism means deep political unrest and instability
Economic
* Inflation rates in Bangladesh have fallen by 1.4% in the past 12 months * Foreign Direct Investment (FDI) has played a key role in the modernisation of the Bangladesh economy for the last 15 years * Bangladesh experienced a uniform and steady decline in poverty rates between 2000 and 2010. Poverty declined 1.8% annually between 2000 and 2005, and 1.7% annually between 2005-2010 * Foreign trade regulations in the EU have increased ethical trading and working conditions, proving helpful to the Bangladesh economy * Growth Rate in Bangladesh averaged 5.62 Percent from 1994 until 2013, reaching an all-time high of 6.71 Percent in 2011 * Clothing made in Bangladesh enjoy duty-free access to the European Union
Social
* Since its independence in 1971, Bangladesh has been plagued with many social issues like poverty, illiteracy etc * With approximately US$750 per capita income Bangladesh is one of the least developed countries (LDC) in the world * Despite increasing level of profit and continuous expansion, the new wealth has not been equally distributed and workers are employed in factories that too often can be categorised as sweatshops * Often garment workers that are exploited and forced to meet exhausting production quota for very little level of wage * There is very low law enforcement level and little practice of a dialogue among government, business associations and workers, where the latter has almost no power; Research can conclude that they significantly contribute to keep the working conditions low * The past four decades have seen increased political empowerment for women, better job prospects, improved education and the adoption of new laws to protect their rights, however culturally women are not seen as equals. Of 1,200 Bangladeshi women surveyed, 67% had experienced domestic violence, and 35% had done so in the past year * In terms of average number of years of total schooling, Bangladesh outshone all of its regional peers, except Sri Lanka. The World Economic Forum’s global gender index shows that Bangladesh fares better than all South Asian countries, again with Sri Lanka as the exception. It also outperformed all Muslim countries bar Indonesia in this regard
Technological
* The need for faster technological development is increasingly felt in Bangladesh * Science and technology have lagged behind in the priority list of the successive governments. However, induced by the recent economic progress, science and technology has been witnessing intense growth in the country after a period of stagnation * The country is heavily dependent on imported technologies * 10,867,567 people in Bangladesh have internet access, just 6.86% of the Bangladesh population * There are no official figures about smartphone users in Bangladesh, but studies can assume that there are around 1 million smartphone users