Business Analysis - SRI LANKA

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Business Analysis - SRI LANKA

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Themes

Sri Lanka, pestel analysis, political factors, economic development, companies, failure, opportunities, economic growth, market

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Abstract

With more than 21 millions inhabitants, Sri Lanka is an emerging country, with high growth rates during last years. The key economic forecasts are good, with a positive and moderate inflation. However, debt risks remain real with a current account negative since 2011 and which should be negative again until, at least, 2021.
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Sri Lanka is a country where companies can benefit from many opportunities. It enables new businesses to conquer a growing market, thanks to an increasingly low poverty rate. But local customs remain strong, and can destabilize a brand, which will not be able to "Americanize" a specific target.

Introduction
Two examples of successful companies
PESTEL Analysis

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[...] In the report Climate change and Sri Lanka, wrote by the Ministry of Environment and Natural Ressources of Sri Lanka, the effects of the climate change are real. Between 1980 and 2005, the average number of events increased from 3 to 15. Flood Frequency in Colombo District (Sri Lanka), Climate Change and Sri Lanka (Ministry of Environment of Sri Lanka), 2010 Legal: The legal framework is similar to England. Sri Lanka has many government authorities in order to regulate the environment and many amendments have been made over the last years. [...]

[...] The company failed for four reasons. First, Knorr did not meet the local palate. Secondly, the communication strategy was very poor and not relevant according to P. Liyanage. Furthermore, the packaging chosen was not good and there was less consumer choice in terms of flavours for customers. The main reason for this failure is linked to the lack of local adaptation. Indeed, the main product was called "Rasakari" and it was connoted as an addictive substance to enhance the taste (rasakakara yak) and so it was perceived as a substitute for "aji-moto" The lack of targeting segment led to a difficult situation. [...]

[...] 1,232Mn to Rs 2,478Mn in 2010 What makes this company successful nowadays? First of all, probably the vision of the company was relevant regarding current trends. Indeed, according to the PDG of Sri Lanka Telecom, the vision of Sri Lanka telecom is that "All Sri Lankans seamlessly connected with world class information, communication and entertainment services". Secondly, we can study strategic objectives of Sri Lanka Telecom to determine the reasons of his success. The first strategic objective of Sri Lanka Telecom is to be customer and market centric, this means to enhance customer experience every time, by being responsive to each customer need or by delivering high quality service. [...]

[...] It can benefit from human talents, especially in the construction of service companies. It also allows the sale of services with better added value and therefore building a strong knowledge economy. Technology : Sri Lanka has a developed railway network with 1447 kilometres and a very developed road network (12 000 kilometres). The overall state of the roads is getting better with many initiatives from the government to develop road network. The use of internet and mobile is also very developed. [...]

[...] The income per capita has more than doubled between 2004 and 2012 according to the Global Competitiveness Report. This economic dynamic is a real asset for the country, and so for potential entrepreneurs. Social : With more than 20 million people, Sri Lanka has achieved a lot during the last years. After the Sri Lanka war, new trends begun with the development of the financial sector. Young people became more "americanised" and spent lot of money buying fashion clothes for pleasure for example. The constant increase of TV channels also show these attitudes changes inside youngsters. [...]

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