PEST Framework Analysis - Essay Example

This is not the case in other countries such as the U.S. and the European markets, where there seem to have relatively sluggish economic growth consequently resulting in decreasing disposable income. The levels of disposable income in any particular country will affect the demand for motorcycles. Most people will tend to determine whether a motorcycle is a luxurious good or an alternatively cheaper means of transport. If for instance the motorcycle is considered a luxurious good, any sort of an increase in the level of disposable income would lead to an increase in demand for the motorcycle and vice versa. On the contrary, if a motorcycle is widely considered a cheaper option for transport, a decrease in the level of disposable income will increase the demand for the motorcycle and vice versa.

The company scenario planners take the varying levels of income into consideration. They plan to establish market segments where different motorcycles would be sold depending on the needs of the market. In addition, scenario planning has led to developing strategies that ensure that motorcycles are developed to meet different economic conditions (Fred, 2011). The company will thus be in a better position to compete well in the market. Other influences such as trade barriers in terms of tariffs are highly affecting the number of motorcycles imported within any particular country. This excludes the countries that are engaged in the agreement of free trade and reduction of trade barriers. The free trade agreement has also increased the opportunity for the international trade of motorcycles.

Legislations regarding noise and emission levels have set standards within certain countries. Thus, motorcycles have to be made to comply with such standards (Fred, 2011). Harley Davidson Company continuously monitors the changes in laws and regulations in the market and other political issues that might hamper the sales efforts such as war.

Over the years, the company has adopted the most advanced technology available. These changes have resulted in changes in the production method that are most efficient and high-yield quality results (Fred, 2011). Trends are favouring the production of the performance-based model. Therefore, this is an opportunity for the company to manufacture such a model. Scenario planning also indicates that it is advantageous to adopt any new manufacturing procedures in time so that the company retains its competitive edge.

The company has to consider the various cultures exhibited in different countries that serve as its market. For instance, China’s culture has seen a relatively large proportion of the population prefer using motorcycles unlike in other countries. The company has heightened interest in meeting these needs whereas creating new demand in areas where people do not have a high need of using motorcycles (Fred, 2011). A scenario planning strategy suggests employing promotional tools such as advertisement. Publicity is also seen as a potential strategy to make people adopt riding motorcycles, a culture that will ultimately improve the profitability of the company.