The PESTEL analysis (also known as PEST analysis) is a model that allows you to understand which external factors can impact your company. It is a tool that provides a better understanding of macro-enironmental factors in the stratefic management of the company.

How to do a PESTEL analysis?

Pestel analysis takes into account the following factors:

Political 
Here, it is important to analyze the political trends and legislation in force that may influence the sector where your company operates (such as political instability or the existence of protectionist measures).

Economic
This analysis can be divided into 2 categories: macroeconomic factors and microeconomic factors.
Macroeconomic factors essentially refer to market supply and demand conditions, while microeconomic factors refer to consumer behavior.

Social
Social factors refer to consumer behaviors and lifestyles, such as demographics, consumption habits, etc.

Technological
It allows assessing the impact of new technologies on a particular product or service, namely the existence of technically professionals, or what type of technology is being used by the competition.

Environmental
It consists of identifying environmental concerns and how they can influence the company's operation, such as environmental and ecological policies and regulations.

Legal
Knowing and understanding the legislation of the environment where the company operates is essential do avoid legal problems that can affect your company not only financially, but also in its reputation.
For this reason, it must be well framed in issues such as labor legislation, consumer law, possible changes in current legislation, etc.

PESTEL analysis and SWOT analysis

Although both models have similar objectives, the truth is that they use different approaches and factors.
While the PEST analysis essentially focuses on factors external to the company, the SWOT analysis focuses on factors internal and external to the organization.
However, despite being different, these two approaches can be used together in order to deepen the vision of the company's strategic positioning. How? Once all the mentioned factors of the PESTEL model have been analyzed, it is possible to classify them as opportunities and threats in the SWOT analysis.