PESTLE Analysis for Parcel Delivery Using Drones in the UK Market
1.0 Introduction
SFS Express is a Chinese company that provides logistics and parcel delivery
services. Having witnessed a lot of success in the Chinese market with its parcel delivery services that relies on drones to make last mile deliveries, the company intends to expand by venturing into the UK market. Being a foreign market, SFS Express needs to understand the external business environment of the UK and its suitability for parcel delivery and courier services using drones. This report presents a PESTLE analysis of the courier and parcel delivery service market as applies to the UK.
2.0 Political
A stable political environment is important for business and provides a conducive environment for economic activities. The United Kingdom is a peaceful country with a stable political environment. The country’s postal and courier industry is liberalized so that any interested person can easily enter the industry (Brown and Conway 2017). The industry is widely unregulated, a factor that has led to the poor services by some industry players (Tims 2014). Operators may, for example, provide postal and courier
services without a license or without prior authorization from Ofcom, the industry regulator (Brown and Conway 2017). Although the industry generally remains widely unregulated, shipping products to and from international destinations outside the European Union requires custom clearance and is highly regulated (Parcel Hero 2015). Several legal hurdles make international shipping both expensive and difficult, which has rendered international shipping unattractive for relatively small firms (UK Government 2017). While the liberation and limited regulation of the parcels industry makes it easy for businesses to venture into the industry, it also gives room for the entry of many players in the industry, which potentially makes the industry highly competitive.
The courier and parcel delivery market in the UK is taxed the same way as other industries. While corporate tax has been set at 19% since 2017, this rate is set to be reduced to 18% as from April, 2020 (with a possible further reduction to 17%) (HM Revenue and Customs 2018). Continue …
