Cage and Pest analysis

Cage and Pest analysis

1. CAGE Identifies cultural, administrative, geographic and economic differences or distances between countries that companies must address when developing international strategies.

2. PEST is a method whereby an organization can assess major external factors that influence its operation in order to become more competitive in the market

3. PEST analysis stands for political, economic, social, and technological.

4. PEST is used to gauge external factors that could impact the profitability of a company.

5. PEST is commonly used in conjunction with SWOT analysis, which stands for strengths, weaknesses, opportunities, and threats.

6. PEST, it is more effective with larger organizations that are more likely to experience the effects of macro events.

7. CAGE analysis yields insights in the key differences between home and target markets and allows companies to assess the desirability of that market.

8. CAGE analysis can help you identify institutional voids, which might otherwise frustrate internationalization efforts. Institutional differences are important to the extent that the absence of specialized intermediaries can raise transaction costs just as their presence can reduce them.