PESTEL Analysis Haircare in

Indonsia
EXTERNAL ANALYSIS

POLITICAL

In 2004 first presidential election through direct

suffrage constitution amendment freedom
improvement

Susilo Bambang Yudhoyono friendly-growth

economic president opportunity

The democracy have opened the country to foreign

investment (reform) opportunity

They have to make efforts for freedom expression

citizens and also freedom of the media threat

Threat of terrorism (risky)

- Corruption
Not stable but they are improving their political environment

ECONOMICAL

Strong labor force capacity (see social)

Bank of Indonesia action: rupiah and exchange rate

stability (inflationary pressure gradually eased)

Growth rate deceleration in 2005 (4,5%) Forecast for

2011 (6% growth rate)

Government support to strengthen the industrial and

manufacturing sectors

Liberalization and investment polices (for few years)

but structural problem (failures)

Inflation in 2010: 5.8% (forecast)

Indonesian Capital Market Supervisory Agency

responsible for business licenses

Strong lending of the bank

The industrial sector accounted for 46.1% of the GDP

Association of South-East Asian Nations (ASEAN) Free

Trade Agreement (AFTA) in 2002: tariffs of 05% to
all intra-ASEAN trade, free trade zone in 2015

- Foreign Direct Investment (FDI): $52 billion (2006)

The portfolio investments: $56 billion (2006)
-

New investment law (Mars 2007): equal legal status

for domestic and foreign investors and reduction of
the time to set up a business to 30 days (instead of
97 days before)

Projects implemented to increase FDI (even if there

is still the bureaucratic red tape)

The government tackles infrastructural difficulties

(supporting the transportationand communication
sector)

Beyond this information, we would need to know

What are the market shares of our future competitors (Unilever,
LOral)
The total cost of implementing a business in Indonesia (business
license)
The average cost of goods transportation
The average cost of workforce
-

Threat of terrorism (risky)

Since 2006 Increasing spending budget in

educationgo to an educated population more and
more aware about health care and health beauty.

Healthy Indonesia 2010 more and more care

about the Indonesians health issues. Cooperation
with NGO and private company. Possibility to extend
to our market.

Huge population 240 million people strong labor

force capacity for production of goods and services.

Difference of population density around the country

challenge to find the right localization

SOCIAL

TECHNOLOGICAL

Indonesia lacks of Innovation and R&D is not welldeveloped. The government hightlight its will to invest in
IT sector.

ENVIRONEMENTT
AL

- Dove (our futur challenger) destroy the

environement with his shampoo made with oil palm
- Huge range of local fruit opportunity to use it to
perfume for ou r range in Indonesia

LEGAL

Corruption