General Mills PESTLE Analysis

Published in Companies category by MBA Skool Team

Here is a detailed PESTLE analysis of General Mills which examines political, economic, social, technological, legal & environmental factors.

Political Factors:

The political factors in the General Mills PESTLE Analysis can be explained as follows:

General Mills is a U.S. based food company which operates in the processed and packaged goods. It operates in more than a dozen countries and has more than 90 brands under its name. Different political factors in different operating countries make this brand adapt and operate its business accordingly. The political stability, imposed taxes and Government driven subsidies and incentives shape the required strategies.

In any countries, the government is focused on manufacturing within its country with new initiatives to support local food business. It is important for this company to consider all the political aspects regarding taxation, import and export duties and tariffs. The processed and packaged goods industry has a lot of government regulations like FDI, price ceiling, GST etc. General Mills has an opportunity here to gain market share with its international standard quality as per government policies.

Image: company website

Economic Factors:

Below are the economic factors in the PESTLE Analysis of General Mills:

A number of economic factors such as inflation, recession, income and education level, tariffs, foreign exchange rate and risks have an influence on the sales of General Mills products. With a huge rate of unemployment and layoffs during COVID-19 pandemic, the consumer spending pattern and sales got shifted to a lower side with the closing of retail stores and other shopping outlets.

As the economic conditions improve, the consumer disposable income increases to buy more packaged and processed food globally. The macro and micro environmental factors shift the consumer purchasing pattern. This company being in the food sector which has inelastic consumer demand in some parts of the world, its supply chain got hampered because of lockdown. The business strategy needs to be adaptable and agile with changing economic dynamics. This can make General Mills profitable with high generating revenue.

Social Factors:

Following are the social factors impacting General Mills PESTLE Analysis:

Society influences people in their choices and decision-making process. The major demographics such as age, gender, education, location preferences etc. impacts the consumer purchasing decisions. Like youngsters and bachelors living alone prefer packaged processed foods. General Mills has an opportunity lying in this segment to increase its market share. Even the working-class population like working mothers and aged people prefer ready to eat and instant mixes from a brand for the ease of convenience. This company has a lot of brands under its name with many famous in India such as Betty Crocker cake mixes, Pillsbury packaged atta and Nature Valley branded biscuits and snack products. Due to COVID-19 outbreak, people have started preferring more healthy, nutritious and hygienic consumables for their friends and families. This company can provide value to the consumers which they are seeking. There are many international and local brands for General Mills to compete with. But it can capture share in its untapped market with its quality, safe and hygienic foods. The proper functional strategies which include marketing, promotions to the society around will enhance its popularity and profitability.

Technological Factors:

The technological factors in the PESTLE Analysis of General Mills are mentioned below:

The social media networks and rise of E-commerce platforms has become a consumer choice today for customer service, selling as well as buying processed and packaged food products. It is important for General Mills to leverage the technological advancements to reach consumers online as well as offline. This company is already selling on major E-commerce retail platforms which is beneficial to increase its sales and revenues. It is also investing in research to develop suitable market specific products. Like this company innovated packaged flour and biscuits for Indian market. From there, it is even exporting to other countries to generate more revenue. It is innovating in food technology, packaging, processing and ingredients to deliver best consumer experience. A few years ago, it innovated new ready to eat 90 calorie Fibre brownies which was a hit among masses.

This is important to keep on innovating to widen its market share and to improve its performance and sales turnover.

Following are the legal factors in the General Mills PESTLE Analysis:

The legal aspects of the package and processed food industry are really stringent. It is important for General Mills to adhere to all laws and mandatory rules and regulations for winning consumers loyalty and their trust over its brand products. Laws related to health and safety, employees and labour work environment, consumer protection, data privacy, IPR and patents etc. are mandatory today in almost all countries. Hence, it becomes crucial for this company to operate in a legal and ethical manner to avoid any lawsuits or any penalty or punishment by the court of law. Like in India, FSSAI is responsible for keeping in check the adulteration, safety and standard of the food products. It is a legal requirement for all food companies to adhere to its policies and guidelines. General Mills should change its business strategies and operations according to the country.

Environmental Factors:

In the General Mills PESTLE Analysis, the environmental elements affecting its business are as below:

All the environment related factors such as climate concerns, greenhouse gas emissions, rising pollution has to be managed well by a company like General Mills. Being a global operating firm, it becomes important to take care of national, local and global environmental laws and policies. It should focus on its waste management, recycling, renewable processes and biodegradable packaging of its food products etc. It should also take mindful action of its resources and waste material depletion which can otherwise have a negative impact on its brand image and customer loyalty.

The attitude and behavior of consumers towards eco-friendly packaging is on rise, this company can take this as an opportunity. As this brings it sustainable competitive advantage as compared to other firms. It can generate more sales and profit margins.

To conclude, the above General Mills PESTLE Analysis highlights the various elements which impact its business performance. This understanding helps to evaluate the criticality of external business factors for any brand.

This article has been researched & authored by the Content & Research Team. It has been reviewed & published by the MBA Skool Team. The content on MBA Skool has been created for educational & academic purpose only.

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