PEST analysis of Telstra
Economic
Economic factors are mostly issues with the economy that affect how the business is being operated.
The GDP and inflation rate
There has been a steady decline in the prices of the various commodities hence affecting the prices. The continued fall in prices will affect the country’s GDP, which affects the telecommunication company. The GDP growth rate is used to determine whether the company’s set strategies can serve long term. Availability of surplus labour is characterized by the high rate of unemployment which suggests that cheap labour is available. The interest’s rate of the country should be considered because it will affect its borrowing ability. Currently, the interest rates in Australia are significantly lower compared to the other years. The fluctuation of the local currency is also a significant issue that the company is facing.
Economic structure
The prevailing economic structure of Australia determines which practices are used by the company. The company enjoys being among the largest in an oligopolistic industry. Financial regulations set by the country will decide whether the business practices set will be acceptable in the country or not.
Financial market efficiency
Financial markets efficiency is the greatest influencers of the expansion strategies and will help Telstar determine whether they are ready to enter a new market or not. High efficient markets enable improved liquidity and strengthen the ability of new companies to enter the market. This is also determined by the company’s ability to raise capital prices at a fair price.
Labour market conditions
The rate of demand and supply of labour in Australia helps the company maintain a skilled workforce that is dedicated. Labour market conditions are determinants of whether the company can attract talented workers or not, and if they can improve the performance of the business hence higher productivity. Shortage of skilled labour in the Australian market can affect the operations of the company.