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The following paper is based on market environment analysis of the chosen company that is Wells Fargo, which is a financial company. The market environment analysis will be conducted with the assistances of Wells Fargo PESTLE analysis and SWOT analysis. However, the SWOT analysis of Wells Fargo will assist to identify the external and internal factors that is the strength and weakness of the company are internal factors on the other hand, the threat and opportunity assist to identify the external factors of the company. In the next section of the paper the PESTLE analysis will widely focus on the management and strategic planning tool. The tool focus on political, economic, technological, social, legal and environmental factors assisting to shape the macro environment of the business. The organisation functions and operates on a dynamic and complex changes which enables to grow the environmental activism, technological changes, collective social trends and evolving legal system. We can help you perfect your Volkswagen case study SWOT analysis.
Wells Fargo is an American multinational financial organisation which is situated in San Francisco, California United States. The company was founded in 1929 by William Fargo and Henry Wells who were the initial founders of the financial institutions. The organisation main product and service offered are merchant services, online banking services, credit facilities, commercial banking, loan, retail banking, payroll, insurances, retirement plans and credit facility. As per the reports of March 2021, the annual revenue of Wells Fargo was 78.472 billion dollars and has been decreasing subsequently by 20.53%. However, the net income of Wells Fargo of the business firm was 6.031 billion dollar and it has declined by 51.65%. On the other hand, it has employed roundabout of 268,531 employees who manage it all across the globe.
As per the Fortune 500 list for 2020, the corporation was placed 30th among the world’s largest companies. In addition, the company received the highest ranking in the region for financing. Wells Fargo's net worth and market capital, was 176.53 billion USD in April 2021. Wells Fargo's power allows them to tap into the enormous economic resources of the SME sector from inside beyond the United States. The covid-19 epidemic has reduced the company's annual revenue and net profits significantly. Aside from that, Wells Fargo has sufficient resources to launch a range of new ventures. Wells Fargo has completed a number of localized acquisitions which is one of its important objectives. The major strength of the organisation is the time of its acquisition. The 1998 amalgamation of Wells Fargo and the Minneapolis-based Norwest Corporation as well as the 2008 purchase of East Coast behemoth Wachovia, are just a few examples. Wells Fargo is a financial services company that offers wholesale financial services such as equipment finance, commercial real, crop insurance, energy syndicated loans, estate and many others.
The major weakness of the organisation is its increasing cost. Wells Fargo has always been the author of multiple lawsuits, with the bank having to pay thousands of dollars in fines and compensation money. Many critics say these are the result of the business's own identity damage. They have however, raised the bank's operating expenses and had a strong influence on its profitability. Other area of weakness is its fake account scandal where workers at Wells Fargo constructed rate is estimated for thousands of customers without their consent in required to address a sales objective in 2016. The company had no intention of paying a settlement fee of $3 billion.
The major opportunity of Wells Fargo is its expansion into smaller regions. Wells Fargo often has branches in major cities within US and other countries. Now is the time for the business to shift its focus to regional communities and begin delivering services in smaller cities. It would benefit the financial firm in expanding its client base. To protect its interests, Wells Fargo should diversify its resources into a stable growing business. In the SME loan area, Wells Fargo has earned a reputation for being commodity. Now is the time for the organization to develop into C&I (commercial and industrial loans). In fact, the bank then became the largest C&I lender in the state. Since losing client business to competitors, the brand has never undertaken it again.
Firstly, the major threat of Wells are its major competitors which are Citibank, Bank of America and Novo Scotia Bank. Secondly, the financial uprising of the business which states that the nation is in the middle of a global economic crisis, with huge peaks and troughs in the financial services industry. In the long run, this will have an influence on the bank industry.
A stable and pleasant economic situation with expected market expansion trends is offered by high political stability. Wells Fargo is currently present in a number of countries each of which has its own set of political problems. Growing tensions and uncertainties in the global political environment could have an influence on the gold industry's growth and restrict Wells Fargo's growth potential. Due to diminished people's trust in business enterprises and the general social and economic structure, business in nations with corrupt practices and poor police forces makes the business situation increasingly unpredictable for Wells Fargo. Entering country with increasing tax rates would have a direct impact on Wells Fargo's profits. Taxation has a negative effect on international trade and restricts exports.
Economic issues such as foreign currency exchange rate, labour market, inflation and saving rates, among others, are comprehended by Wells Fargo since they determine the entire economic situation of the United States. Growing economies present Wells Fargo with a diverse variety of investment opportunities. Wells Fargo's business performance a well-developed infrastructure enhances the business atmosphere and the gold industry's potential for growth in the particular country. The ability of Wells Fargo to pursue its long-term future goals will be influenced by the GDP growth rate. As per the recent reports the GDP rate of 2020 is -3.51% due to the outbreak of global pandemic covid-19. The high interest rate will motivate people to invest and enhance Wells Fargo's potential growth.
The United States, like most industrialised nations is contending with an elderly society, which could result in a worker shortage and higher tax rates in the ahead. With a population to about 332 million people, the United States is the world's third largest populated country. Considering this, the country's welfare and health systems are some of the greatest in the world. Although the rest of the people is liberal, increasing racism and intolerance is a big concern. Increased illegal immigration is also an issue as there are already over 11.7 million people living in the United States illegally, increasing the potential of discrimination.
The United States' company is based on innovation and technology. The country has always been at the forefront of technology assimilation and implementation from its foundation. Despite stiff competition from emerging markets, it is expected that the country will retain its technological edge over its rivals. Furthermore, the United States has been at the front of improving and creating technologies in sectors such as nanotechnology, technology assessment and biotechnology which provides enormous opportunities for businesses with competence in these sectors. IT is another area where the United States has succeeded. However, this has been up against stiff competition from countries such as India and China.
Each state in the United States has its own constitution and justice system. The regulatory environment in which companies operate is influenced by the characteristics in which they function. Nationals and immigrants are treated equally all through the state. The judicial system will give overseas employees a proper trial. In addition, the United States has a proper moral structure in place to preserve intellectual property rights.
The landscape, climatic condition and wildlife of the United States are all extremely different. This diversity, along with other reasons like natural wonders, attractive rural towns and dynamic capitals, has drawn millions of tourists visiting. In 2019, the United States welcomed 79.26 million international tourist arrivals. The top six countries bringing tourists to the United States are Canada, Mexico, Japan, Brazil, the United Kingdom, and China. There were 15 weather and climate disasters in 2017, with each damage reaching $1 billion. These tragedies not only entail financial losses, but they also interrupt daily living in the world's most developed nation.
Conclusion
Hence, it can be concluded that the PESTEL analysis is an integral business tool that entails a comprehensive review of macro-environmental variables that affect the economic growth. Each element contains various factors that affect the strategic decision-making process of commercial entities like Wells Fargo, ranging from political issues to environmental ones. identifying and assisting the planned decision-making process involves identifying the primary various environmental forces that shape the approach and business environment. Wells Fargo has expanded considerably in the last several generations to become the world's second-largest investment banking corporation in terms of market value, with a wide variety of benefits in financial planning, investment brokerage and banking. Conducting a PESTEL and SWOT evaluation is critical for building appropriate ways and realizing long-term business objectives as it strives to extend and utilize its competencies and core skills. Wait no more and seek wells fargo SWOT analysis assignment help services from Tophomeworkhelper.com today.
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