Strategic Assessment of Drones for a Delivery Company into the United Arab Emirates Market


Research Paper (postgraduate), 2018

15 Pages, Grade: B


Excerpt

Table of Contents

PESTLE the concept:

PESTLE the model:

Strengths of PESTEL analysis:

Weaknesses of PESTEL analysis:

PESTLE analysis of United Arab Emirates:
Political
UAE Political out line
UAE Political stability situation
Government of the UAE initiatives product support
Economic
Understanding UAE Economic situation
Drones market potential in the UAE
Additional Economic factors
Legal
Understanding the judicial system in the UAE
Drones legal and regulations in the UAE

Recommendation

References

Executive Summary:

This report aims to provide an advice to Drones for delivery company on its plan to enter the UAE market to provide delivery service. In order to take the proper decision, the report studies the external environment of the UAE market using PESTLE framework, following by analyzing the (Political, Economic and Legal) factors.

The finding from the analysis strongly recommend Drones for Delivery to enter the UAE market and found it a very good option.

The political situation is stable within the UAE and the government is supportive for investment in the country. The investors considered UAE one of the safest places in the region and attractive for investment.

The economic situation is good in spite of the decrease of oil prices which affected the country income badly, the UAE plan for depending on the green economy as a replacement of oil supported it to come over this situation.

Legal factors will be challengeable factors for the company as the regulation which established Implementation from the General civil aviation Authority regarding the flight conditions of the drones will limit the usage of drones and the company has to find some alternative solutions to reduce the effect of these regulations.

PESTLE the concept:

PESTLE is one of the most effective marketing tools which supports the companies’ decision making for entering new markets (Ho, 2014). The main purpose of using PESTLE analysis is to give an indication about the effect of the external environmental factors on the business (Song, et al., 2017).

It gives clear marketing investigation to the product and also, gives explanation to the environment which the company will work within it (Bivolaru et al., 2009). Gupta (2013) argues that using PESTLE analysis gives a great assistance to the companies in terms of developing appropriate strategies for specific market. PESTLE framework can give long term business strategies and innovation plan if the company gives more attention to the external factors change and put regular adaptation strategies to meet the changes as per current market situation (Andres et al., 2017). Because the above-mentioned reasons, many experts strongly recommended the usage of this framework before investing in any new market (Ho, 2014; Yuksel, 2012; Song et al., 2017).

PESTLE the model:

PESTLE analyses the market from many aspects Political, Economic, Social, Technological, Legal and Environmental (Yuksel, 2012).

Political

Political factors mainly give explanation about the targeted country lows and policies in addition to social institutions, analyzing those factors will enhance the company ability to comply with the country lows (Song et al., 2017).

Economical

Economic factors study the effect of macro and micro economic parameters which will directly affect business strategies and company growth (Yuksel, 2012).

Social

Social factors concern about the targeted market culture, custom values and traditions. Giving attention to those factors that it will allow the company to expand quickly if it understood the needs of the targeted people and adopt its product to comply with it (Song et al., 2017).

Technological

Technological factors refer to how to apply the technological solution and examining the validity of its application on the targeted market (Song eta al., 2017).

Legal

Currently legislation and regulations affect directly the existence and survival of any company in any market. Identifying the legal factors reduce the risk which is likely to be exposed to the company (Kolios and Read, 2013).

Environmental:

Environmental aspects express the surrounding area environment and the product effect on it, it draws the relationship line between products, consumers and the environment (Kolios and Read, 2013).

Strengths of PESTEL analysis:

- PESTLE analysis gives competitive advantage for the company on the level of setting strategies and market study (Bivolaru et al., 2009).
- Application flexibility as a marketing tool provides its users, the advantage of the application to any product at any market (Hopkin, 2017).
- PESTLE gives suitable and logical facts about the surrounding work environment which allows the company to take competitive advantages (Yuksel, 2012).

Weaknesses of PESTEL analysis:

- PESTLE needs contentious development and adoption as it can’t treat with the changes in the work environment and several factors which affecting the market such as changes in political views and consumers’ preferences (Andres et al., 2017).
- Generally, it gives a qualitative approach and it is difficult to be measurable and evaluated based on quantitative approach (Yuksel, 2012).
- PESTLE doesn’t give a clear approach to the factors inter-dependence (Yuksel, 2012).

PESTLE analysis of the United Arab Emirates:

The following analysis will discuss the political, economic and environmental factors of setting up the drone delivery service in UAE.

Political

The UAE Political outline

The UAE led by the federal, presidential, absolute monarchy system as the president elected from one of the monarchs of the seven Emirates (Government. UK, 2017). UAE contains seven Emirates each one of them managed by the prince who is responsible for managing and controlling its resources (Helen Ziegler and Associates, 2014). The president of the UAE since 2004 is HH Khalifa Ben Zayed Alnuhiyan the ruler of Abu Dhabi, the government head and the prime minister is HH Mohamed Bin Rashid Almaktoom the ruler of Dubai (Helen Ziegler and Associates, 2014).

The UAE Political stability situation

The UAE considered as a politically stable country (Research and markets, 2016). Generally, investors considered UAE a very safe region and also, a very attractive country for investment (GOV. UK, 2017). The Bank of America survey for political stability ranked UAE in the third rank from 80 countries included in the survey from Eastern Europe, Middle east and Africa after gaining 23 points out of 25 total points which reflect its capability of facing the political risks (Emirates 247 Business, 2011).

The political stability situation one of the most supportive reasons behind this attractiveness in addition to that the treatment equality between national citizens and the foreign labor which reflect the government direction to openness and the friendly investment environment (Emirates 247 Business, 2011). The limitation of taxes on the corporates and the absence of systematic corruption considered as a very positive factor for Drones delivery to enter the UAE market (US department of state, 2017).

The freedom house report 2018 considered UAE not politically free as its scores in the freedom rating 6.5/7, in political rights 7/7 and civil liberties 6/7 (Freedom House, 2018). In spite of that ranking, UAE citizens assuring that they are totally free to discuss the political situation and they are enjoying the utmost political freedom (LookLex Encyclopaedia, Online).

[...]

Excerpt out of 15 pages

Details

Title
Strategic Assessment of Drones for a Delivery Company into the United Arab Emirates Market
College
University of Northampton
Grade
B
Author
Year
2018
Pages
15
Catalog Number
V424773
ISBN (eBook)
9783668720510
ISBN (Book)
9783668720527
File size
487 KB
Language
English
Tags
strategic, assessment, drones, delivery, company, united, arab, emirates, market
Quote paper
Mohamed Radwan (Author), 2018, Strategic Assessment of Drones for a Delivery Company into the United Arab Emirates Market, Munich, GRIN Verlag, https://www.grin.com/document/424773

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