Name : Kawish.K.

Hassani
Enrolment no. – 20180201040
BBA Sem-5 , Sec-1

Chatime.

PESTLE Analysis : It basically describes a framework of macro-environmental factors used in the

environmental scanning component of strategic management.

 Introduction : Headquarters of Chatime is situated in Taiwan and Henry Wang Yao Hui has
started this company back in 2005. At the moment it is the largest teahouse franchise in the
world.
 Its expansion and growth model is through franchising. It operates 2500+ outlets in 38
countries.

 Political Factors :

 It generally includes all the Govt. rules and policies , tax methods in practice , political
IN(Stability) and Corruption.
 Chatime has its outlets in more than 38 countries. Govt. rules and regulation are not similar at
each place.
 For an example : When Chatime entered outside Taiwan for the first time in New York in
2006 Tax received by US government is quite lower that is 24.3% as compared to Other
developed nations like France(46.1%) , UK or Australia (28%).
 Political factors play a very vital role in regulating the terms & condition for chatime in
regulating there franchise policies.
 Another is political instability that refers to the fluctuation in government ruling a particular
country, If there is a lot of fluctuation in ruling government than policies for international
companies and tax rules may vary and this may create vivid hinderance for the company
targeting in a particular market.

 Economic factors :

 These factors are one of the most important , these factors include
 Economic growth of a country , Exchange rates , Interest rates , Inflation rates.
 Disposable income of a consumers of a country.
 Chatime has a vision of being the Starbucks for “Tea” so they have kept all the economic
factors into consideration.
 For an instance Per Capita Income of Australia is $50,050 which is a good number and 70%
of its GDP comprises of Service industry and Chatime is one of them.
 And while entering is Australia another factor is the interest rates are about 2-3% which less
as compared to 7-8% of India.
 Such factors helped Chatime establish its very strong market in Australia as economic factors
are directly proportional to price of a companies products and pricing of its products and
services.
 The price range of Chatime ranges between 4.5AUD to nearly 5 AUD in Australia which is
almost equal to 250 INR.
 While taking an example of price range in Indonesia it differs from 15k IDR to 25K IDR
which is almost equal to 150-170 INR.
 Thus this is an perfect example of role of economic factors in different countries leading to
variation in prices of there products.
 Competitors : Share Tea , Gon Cha , Calais , Starbucks , Boost Juice Bar.

 Social Factors :

 This is the general environment factors which represent demographic characteristics , norms
and values within which an environment operates.
 These factors include :
1. Population Growth Rate :
2. Age Distribution :
3. Income levels :
4. Careers , Health and lifestyle :
5. Cultural Barriers :
 In continuation of the above example these are the factors which has affected the growth of
Chatime the most.
 While entering into the foreign market biggest drawback of chatime was its major focus was
on the Asian Population and on the type of audience who knew about the benefits of drinking
tea.
 But in Country like Australia native people are really fond of having coffee and have never
experienced drinking tea.
 So this created a somewhat social differences in the audience by targeting a particular type of
audience .
 Another is Chatime counters generally had people from there natives or who were familiar to
Mandarin language even though they knew English but still this needs to be improved and
Chatime should hire employees of mixed cultures.
 Generally 75% of Chatime stores are seen at crowded places like malls , stations , streets etc..
with a luxurious interior and hygienic environment.
 This strategy helps them in growing their business very rapidly.
 Lastly in order to expand they are trying to bring in some fresh fruit juices , protein shakes ,
drinks with less sugar in order to attract the audience apart from Asians.

Products of Chatime :

DRINKS :
- In flavours of 30 to 90.
- Best sellers Oriental green tea and Pearl Milk tea are its best sellers.

 Technological factors :

 It includes Technological incentives , level of innovation , Automation , R&D activity

and technological change.
 Machines are so well made that they could make teas from 30 to 90 different flavours
just on finger tips.
 All of its stores are partially automated and it just requires 3 people to use the
software and place order and may be in the coming future it becomes fully automated.
 Technology is its strength Chatime is fully equipped with superior technologies.
 Machines are so fast that it gives at a speed of 20sec/glass for the customer.
 Always has a good hygiene maintained.
 Any technical error in their machines may lead to a complete shut down for the stores
as they are highly reliable on the machines and soft-wares. (but usually it does not
face such issue.)

 Environmental factors :

 Environmental factors have become very important in this era because of scarcity of
raw materials , pollution being caused and carbon footprints target set by government
and NGO’s.
 It includes Weather , Climate , Environmental factors , Climate change.
 These factors generally refers to wellbeing of the planet.
 By keeping in note of sustainability the cups and their lids are made from bioplastic,
which is made from plants, rather than fossil fuels like oil. Currently, they are only
compostable in industrial compost facilities so Chatime has teamed up with a
contractor to collect used cups and lids from its T-breweries and send them away to
be composted. And paper straws are being bought into action.

- Thankyou!!!!