Pestel analysis

Political factors
1. The Al Qaeda terrorist attacks of September 2001 influenced a decrease of tourists in the United States.
2. The Costa Rica’s government encourages diversifying economy and promoting non-traditional business, which including exemption income tax and duty-free for import machinery and equipment.
3. There is a low entry and exit barriers in the production and export of live pupae.
Economical factors
1. The information for both suppliers and buyer are “fragmented and little” in butterfly industry, so there is a broad space for people to expand butterfly market.
2. According to the Table 1, there was an increasing number of demands in butterfly pupa from Costa Rica between 2001 and 2006, which means the demand might still growth in future.
3. The price of butterfly pupae decreased 40 percent by the mid 1990s, companies had to reduced their price as well.
Social factors
1. Promotions could attract more children and adults who have the hobby of collection. People can buy encased butterflies in kiosks to complete their collections (in Exhibit 4 and 5).
2. The butterflies’ suppliers came from low-income backgrounds. 20 percent of them were living in poverty, and 5.8% were extreme poverty (Exhibit 2).

Technological factors
1. The butterfly in farm must be bred in a circumstance with specific climate in order to away from those predators, viruses, or weather conditions.
2. The leaf for food also needs to be checked carefully without viruses and parasites.
3. The pupa is stored in special containers to ensure safety.
4. Butterfly specimens must be made out of complex and rigorous procedures, which need excessively high costs excessively high costs.
Environmental factors
1. After the Nobel Peace Prize was regarded to President Oscar Arias, tourism experienced a rapid growth. Costa Rica was focusing on building an environmentally friendly market for both suppliers and customers.
2. Butterfly industry can help people understand knowledge about butterflies with out harm those wild animals.
3. Using photovoltaic cells to generate electricity is also a feasible method to decrease pollution.
Legal factors
1. The butterfly farm is a separate entity, which does not enjoy the preferential policy of the government.
2. Breeders must obey all stringent regulations for the breeding of butterflies imposed by the Ministry of the Environment.
3. A “code of professional ethics of the breeder affiliated with CRES” was adopted by Joris to ensure the fair competition.