PESTEL Analysis Assignment

The political scenario is relatively stable in Saudi Arabia. It is easier for the foreign
companies to enter this country since the government organization is tolerant in this
case. The rigidity of trade barriers also in this country is less.

Environmental Factors
The environment of Saudi Arabia is good for the business process.

Social Factors
Since, Saudi Arabia is predominantly Muslim country, it is very important for any finance
company; especially those in the business plan of lending should follow the norms of
Islamic banking.
Technological Factor
Technologically Saudi Arabia is advanced enough.
Economical Factors

Since Saudi Arabias economy is developed, there should not be much problem in
terms of cost economic environment.
Legal Factors

In Saudi Arabia, due to the fact that the king has absolute power, the laws or rules and
regulation are prone to modification at any point of time. This makes the legal
environment of Saudi Arabia quite volatile. The governing rule of this country is
determined by the Shariah. But it has been seen that quite a few new laws are
forthcoming. These laws are more favorable to the business scenario of the country and
for the companies which are coming from outside.
INTERNATIONAL MARKETING

The idea of International Marketing bases itself on the belief that there is no centre of
the earth. The occurrence of internationalism of the markets has several new traits like
integrative international formations. In the line of this, International business as well as
international marketing is based upon the the dynamic principle that customers
inclinations can be, and are, steadily being changed by common exogenous (rather
than endogenous) forces, resulting in the convergence of many consumers wants and
desires (Perry, 1999). Ever increasing accessibility and increase in the extent of
transportation and information technologies have been helping the global customers to
become more and more identical. This fact coupled with the better accessibility of
overseas markets has helped the cause of international marketing. (Svensson, 2002).
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While defining international marketing, Gerald and Edwin (2008) has said that the
activity of international marketing cannot be explained by the definition of general
marketing. He also said that this is due to the fact that during the course of international
marketing, services and goods are marketed across political borders ( Gerald
and Edwin, 2008) Philip and Cateora, ( 2010) has given a more precise definition of
international marketing. He said that international marketing assignment is the
execution of activities which are related to the business and facilitates the flow of the
goods and services of a company towards the users or the customers of the company
who are geographically dispersed and located in different countries for profit. (Philip and
Cateora, 2010) It is imperative for the global marketing companies to understand that
international consumers are different from one another with respect to the buying
patterns and propensity to consume as well as consumer behaviour from culture to
culture. International marketing has its base on the understanding that markets are
more dependent on the people it deals with and not the products (Albaum, 2009).
It is possible for a company to manufacture a product which can be truly called global.
But it is not only difficult but also impossible to find a group of buyers who can be called
global consumer. Hence localization of communication and marketing is of utmost
importance for the organization (Jeannet and Hennessey, 2009). As has been said by
Jeannet and Hennessey, while executing the process of international marketing, it is
important for a corporation to go beyond the process of exporting and get intensely
involved in the local marketing environment of a particular nation or market. This is
because of the fact that global brands do not necessarily evoke the sense of global
motivations amongst its intended customer base (De Mooij, 1998). There are various
ways for entering in an international market. Domestically manufacturing the product
and then directly exporting the product to the intended country for sales is the basic
modus operandi for international marketers. After this process is over, the company can
sell its product in the foreign market through its own sales organization which has been
established by itself (Direct Exporting) or can indirectly sell through a company which is
based out of that nation and has significant understanding of the market of that country
(Using an Agent) (Perry, 1999). There are some other options as well like licensing, joint
ventures, direct investment or buying of local offices. In the process of licensing a
contract is made with an overseas company, whose product is procured by a company
and sold in some other country. In the case of joint ventures a combined possession of
a business entity is carried out for the sake of manufacturing and/or selling the product
in some other nation). On the other hand, direct investment makes sure that a company
avails a direct possession of facilities of overseas distribution. This option is costlier as
well as has more of risk element than the previously stated options. Hence most of the
companies until and unless they are assured about the success in the foreign country
go for indirect and direct exporting (Jeannet and Hennessey, 2009).

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In Saudi Arabia, buying local offices, which is creating a partnership with some local
company of the country, can be better for a company. This is due to the fact that there is
a rule in Saudi Arabia that all the organizations should have a local partner with
controlling stake in the company (Mohamad, 2002). Hence it will be beneficial for a
company to have a joint venture with a local distribution and marketing company. The
benefits those can be achieved through this process are that, it will be possible for the
foreign company to get hold of tacit knowledge through the local firm. It may also be
possible to gain faith of the local customers easily through this.
REFERENCES
Bradford, R., Duncan,P., Simplified Strategic Planning: The No Nonsense Guide for
Busy People Who Want Results Fast, Chanlder House Press, 1999.
Gerald, A. Edwin, D. (2008), International Marketing and Export Management. Financial
Times Prentice Hall.
Gerald Albaum (2009), International Marketing and Export Management, Prentice Hall.
Havergal, M & Edmonstone, J (1999) The Facilitators Toolkit, Gower Publishing Ltd.
UK.
Jean-Pierre Jeannet and H. David Hennessey
(2009), Global Marketing
Strategies And Cases In Global Marketing Strategies, Cengage Learning EMEA.
Keegan, W. (1960), Marketing Management: Policies and Decisions, Boston, MA:
Houghton Mif in.
Marieke K. de Mooij (1998), Global marketing and advertising, Sage Publications, Inc.
Mohamad, M. (2002), Globalization: Challenges and Impact on Asia, in Richter, F.-J.
and Mar, P. C. M. (eds.), Recreating Asia: Visions for a New Century, Singapore: John
Wiley & Sons (Asia), pp. 511
Perry, A. C. (1999), International versus domestic marketing: four conceptual
perspectives, European Journal of Marketing, 24(6).
Philip R. Cateora, John L. Graham (2007), International marketing. McGraw-Hill/Irwin

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