Swan Malaysia Sdn Bhd is one of the three production facilities of the Schwan-STABILO Group "that guarantee the best materials and resources, workmanship and experienced staff" (Swan Malaysia Sdn Bhd).
It is the goal of this paper to analyze the particular external environment of STABILO Malaysia or the Swan Malaysia Sdn Bhd subsidiary as an aid to better business policy. Effective management and evaluation tools such as the PEST Analysis, The Porter's Five Forces Analysis, the Competitor Analysis and the Market Trend Analysis will all be done in this particular case.
The external environment may seem out of company's control as the political, economic, social and technological climate are determined by outside factors, but the responsibility to forecast, adjust and reconcile the company's direction to them is within the company's scope and capability.
Political. Malaysia espouses the Parliamentary democracy, with a constitutional monarch, the King of Malaysia as the head of state and the government administration divided among the Executive, Judicial and Legislative branches (Malaysian Administrative Modernisation and Management Planning Unit, 2010).
The country's judiciary in Malaysia is said to be not independent as there seems to be "excessive influence of the executive over the judiciary, especially in politically motivated cases" thus foreigners cannot be guaranteed an impartial trial from the country's judiciary (Alibaba.com, 2008). As to tax rates, the coutnry requires to Value Added Tax (VAT), but there is a sales tax which is normally at 5%, except for cigarette which is taxed 25% and wine and beer which is taxed at 20% (Alibaba.com, 2008). For corporation, capital gains tax range from 0% to 28% (Alibaba.com, 2008).
Economic. Malaysia is one of the growing economies in Asia. Although it posted a -2.8% growth rate in 2010 its inflation rate was moderate at 0.4% in the same year (IndexMundi, 2010). Malaysia Ringgit is a relatively strong currency, which is currently exhcanged for 3.26 to 1.00 USD compared to Philippines' 45.9 to 1.00 USD (http://www.xe.com, 2010). Malaysia's competitive ranking surged to 10th compared to 18th a year ago "as the country benefited from strong demand from Asia as well as implementation of efficient policies, especially government policies" (Sidhu, 2010). Investment banker attributes the leap from the government's strong commitment to "reshapre the country's competitive landscape" (Sidhu, 2010). The ranking which was based from four main criteria including economic performance, governmen efficiency, business, efficiency and infrastructure is expected to boost the country's private investment (Sidhu, 2010).
Social. The country currently houses 28.96 million individuals, with a projected average growth rate of 1.6% per year, a figure which is lower than the previous years and is primarily attributed Malaysians' decision to delay marriage and pursue higher education and career advancement (Malaxi.com, 2010 cited in Department of statistic and economic planning unit). 63.6% of the population is from 15-64 years old, 31.7% aged