MRSE 1123: Strategic Management

PESTEL Analysis

Top Glove Corporation Bhd

1
 PESTEL Analysis
FACTORS CHALLENGES CATEGORIES
• Highly multi-democratic party providing the power of stability A
POLITICAL • Government enforces several policy and procedures for a smooth working Min. Effort
• Increased its economy by exporting its products around the world
• Weaker US Dollar against Ringgit due to profit measured in USD
C
ECONOMICAL
• Volatility in latex price Keep Satisfied

• Majorly the social factors of Malaysia contribute with the population of

D
Islamic religion
SOCIAL • Forced labor for continuous work for 29 days Managed
• Holding passport of migrant labor Closely

• High requirement of the innovation of technology in the rubber gloves

B
TECNOLOGICAL industry – lack of automation
• Provides a scale of production of good quality gloves at a large amount. Keep Informed

• High tax paid to the government for proper running of the Top Gloves
industry in Malaysia
• US ban on the import of rubber gloves from one Malaysian company over
C
LEGAL
forced labor allegations Keep Satisfied
• Maximum 104 Overtime hours / month

D
• Use the method of recycle of the waste products 2
ENVIRONMENTAL • Compliance to Department of Environment (DoE) regulations Managed
Closely

OPPORTUNITY
Support from government
Natural gas subsidy
China Trade war
Hygiene awareness
THREATS
Diminishing threat of H1N1
Increase in latex price
Steep competition for nitrile
products
Lack of migrant labour force
STRENGTHS
Wide product range
High quality of products
TOWS
Largest market share in glove industry
International accreditations
SO: Attacking strategy
Attract new business deals with
international accreditations from the
China Trade war opportunity.
Nurtures hygiene awareness to promote
broad utilization of wide product range
and high-quality products.
Support for easy access to raw material
and natural gas subsidy as the largest
market share in glove industry
ST: Defensive strategy
Wide product range outside medical use
to reduce threat of reduced seasonal
diseases like H1N1, e.g. gardening.
Balance steep competition of nitrile
products with wide product range
Improve branding with international
accreditations to minimize lack of
migrant labour force
WEAKNESSES
Competitive market
Environmental awareness
High turnover rate
Currency exposure
WO: Build strength for attacking strategy
Optimizing the influx of demand due to China
Trade war to minimize the competitive market
Government support for collaboration with
local institution to provide good career path
and R&D facilities to overcome high turnover
rate
Optimizing subsidy to overcome highly
competitive market
WT: Build strength for defensive strategy
Nurture environmental awareness to reduce
exposure to increase latex price.
Produce biodegradable gloves in line with
environmental awareness as alternatives to
nitrile products.
Minimize currency exposure by reducing
employment of migrant labour force. 3
Thank You