...environmental and legal analysis of forces that impact the business environment. It will be utilized to find the circumstances surrounding the market and as an instrument for understanding the market situation such as market growth/decline, business position, market potential and the direction of a company’s operations. It is very important for a company to consider its environment before starting to perform activities. As a first step on the way to enter and perform successfully on the Chinese market, knowledge about the macro environment will have to be created.50 In the following the six parts of the PESTEL analysis will be presented with reference to the conditions on the Chinese market effecting branding.` 5.1.1 Political `The political situation has a huge influence upon the regulation of the economy, and the spending power of consumers and companies. Consequently areas such as political stability and trading agreements must be considered.51 Through the last decades China has evolved from being a totalitarian communistic regime with a centrally governed economical system to a more open market economy with wider economic and social freedom for its citizens. The Communist Party of China (CPC) still has an absolute power monopoly and an actual liberalization of the political area is not taking place.52` 50 51 Marketing Teacher Ltd - www.marketingteacher.com Value Based Management.net 52 Ministry of Foreign Affairs of Denmark - A – www.um.dk 31 `The Chinese administration has also shown signs of more openness and transparency and the judicial system and legislation is starting to build a constitutional state founded on the rule of law. It has for example been decided to implement the right to private property in the constitution. As a consequence private initiative has become more important in the Chinese society.53 Following the rapid economic...
