Lecture 11

Social, Technology,
Legal, and Environment
factors
 Contents

1. Social

2. Technology

3. Legal

4. Environment
 Reminding of Macro environment
applied PESTEL

PESTLE model?
 PESTLE Model

Source: https://www.shutterstock.com/search/pestle+analysis
1. Social Environment
 Social environment

1.1 Vietnam’s Demography

 Social environment

What is Demography?
(Nhân khẩu học)
 Demography

• Demography is the study of population in term of

overall size and structural characteristics
• For example: age structure, gender balance,
geographic distribution, ethnicity etc.
• This factor has an important implication for both the
demand and supply side of the economy.
 Social environment

Demography of Vietnam
(Nhân khẩu học)
 Vietnam demography (May 2021)

• Rank: 15th
• Population: 98.155.575 (occupies 1,25% world population)
• The total land area: 310,060 square kilometers.
• The population density of Vietnam is 317 people/km2.
• Lives in urban areas: 37.34% of the population (36.346,227 people
in 2019).
• The average age in Vietnam is 32.9 years old.

Source: https://danso.org/viet-nam/
 Vietnam Population 2020

Source: https://www.gso.gov.vn/du-lieu-va-so-lieu-thong-ke/2021/01/infographic-dan-so-lao-dong-va-viec-lam-nam-2020/
 Vietnam population Chart

Source: https://danso.org/viet-nam/
 Vietnam population

Source: https://danso.org/viet-nam/
 Social environment

1.2 Factors of Demography

 Social environment

Crude Birth rate and

Crude Death rate
(Tỷ suất sinh thô và tỷ suất chết thô)
 Birth rate

• Crude Birth rate: number of live births per thousand of

population annually.
 Birth rate

• There are some countries with reducing number of births:

✓ Smaller family as people become better off and good healthcare

✓ Availability of contraception

✓ Later marriage and child bearing

✓ Declining fertility rate

✓ Changing attitudes toward women and work

 Death rate

• Like birth rates, Crude death rates are usually measured

per thousand of the population annually
 Death rate

• Factors contributing to a fallen death rates:

✓ Rising living standards, including better housing, sanitation
and nutrition.

✓ Developments in medical technology and practice.

✓ Better education.

✓ Improved working conditions.

 Rate of natural increase

• Rate of natural increase (tỷ lệ tăng tự nhiên)

= Crude birth rate – Crude Death rate

 Birth rate and Death rate of
Vietnam within 5 years

Criteria 2015 2016 2017 2018 2019

Crude Birth 16,2 16,0 14,9 14,6 16,3
rate
Crude 6,8 6,8 6,8 6,8 6,3
Dearth rate
Rate of natural 9,4 9,2 8,1 7,8 10,0
increase

Source: https://www.gso.gov.vn/px-web-2/?pxid=V0212-14&theme=D%C3%A2n%20s%E1%BB%91%20v%C3%A0%20lao%20%C4%91%E1%BB%99ng
 Social environment

Net migration
(Di cư)
 Net migration

• Net migration is the balance between those leaving and

those entering a country in a period of time
 Net migration

• Influences on the net migration are:

✓ Legal barriers (e.g. immigration laws).

✓ Economic migrancy.

✓ The numbers fleeing persecution.

✓ Government policy.
 Social environment

Age structure
(Cấu trúc dân số theo độ tuổi)
 Age structure (May 2021)

Source: https://danso.org/viet-nam/
 Vietnam Age Structure
2009-2019

Source: https://www.statista.com/statistics/444599/age-structure-in-vietnam/
 Labor age structure

Source: https://www.gso.gov.vn/du-lieu-va-so-lieu-thong-ke/2021/01/infographic-dan-so-lao-dong-va-viec-lam-nam-2020/
 Population’s effects on Business

• Population rises = Employees

Employees markets
Consumers Productivity

Age structure Affect GDP

Scale of business Demands in general changes

Demands of age
Sale of business changes
 Social environment

Social class
(Tầng lớp xã hội)
 Social context

• Social class: the idea of grouping people who share similar

social status (rich, poor and middle class)
• Social mobility: individual’s ability to move between the
different social class
• Lifestyles: factor that clearly affect people’s attitudes and
behavior
• Other social influences
 Social class in Vietnam 2010-2016

Source: http://ncif.gov.vn/Pages/NewsDetail.aspx?newid=22020
 Trends of social classes in Vietnam to
2030

Source: https://www.gmholdings.com.vn/tang-lop-trung-luu-co-the-chiem-1-2-dan-so-viet-nam-vai-nam-toi/
 Social class’s effects on Business

• Middle or Rich class rises = Consumption

Demands in general
Value of goods
purchased

Sale of business Normal goods/ Luxury goods

Affect GDP

Scale of business
 Example: Total CAR sales by the end
of December 2020

Source: https://thitruongtaichinhtiente.vn/doanh-so-ban-o-to-tang-45-so-voi-cung-ky-nam-2019-33105.html
 Social environment

Culture
(Văn hóa)
 Culture

• The term ‘culture’ generally refers to a complex set of values,

norms, beliefs, attitudes, customs, systems and artefacts which are
handed down from generation to generations
• Culture can affect not only the kinds of goods and services that are
consumed but also the production process
• Sub-culture: groups of individuals with shared value systems based
on common experiences, origins and/or situations
 Culture changing’s effects on Business

• Culture changes = Belief/ Interest/ Habit/ Hate changes

Demands in general changes

Value of goods
purchased

Sale of business changes Affect GDP

Scale of business Strategies, field of

changes business changes
 Examples: Estimated Scale of logistics industry
in Vietnam from 2018 to 2022

Source: https://www.vietmis.com/vietmis-blog-kinh-doanh-40/thi-truong-dich-vu-giao-hang-viet-nam-duoi-goc-nhin-tu-thi-truong-e-commerce-e-logistics.html
 Social environment

Market segmentation
(Phân khúc thị trường)
 Market segmentation

• Market segmentation refers to the practice of dividing market

into distinct groups of buyers who have similar taste, needs
and behaviors
• Segmenting help business focus their marketing effort more
effectively and efficiently
• Demographic, social and culture factors can provide good a
basis for identifying distinct market segments
Methods of segmenting
consumer markets
2. Technology
Environment
 Technology environment

Current issues of
Technology
 Technology issue

• Information Technology: artificial intelligence

New Old products: more profitable to produce through CAD

products (Computer-aided design)
 Technology issue
● New materials: It consists of a single layer of carbon atoms bonded
together in hexagons and is the strongest material ever measured. It is a
replacement for silicon and will revolutionize computers.

● Biotechnology. This is expected to have wide-ranging effects on many

fields. The development of new products like computers that can imitate
the activity of the brain can shorten the development process for certain
products by speeding up existing processes.
 Technology issue
● Energy: The kind of developments that can take place in this field are
the use of superconductors to transport electricity and research that
might make renewable energy a viable source of energy.

E.g. In 2016 Portugal ran all of the country on renewable energy

for a whole week, the first time something of this scale had ever been
attempted.
 Example:
Selling Lichi Fruit on Ecommerce
platform during Covid 19

Sale in Europe for the

first time

Nông sản #VietNam lần đầu

sang #ChauAu theo mô hình
#thuongmaidientu xuyên
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nline
 Technology environment

Technology’s effects
on Business
 Technology’s effects on Business

• Technology changes

New materials, New products Consumer Productivity

behavior changes

Supply
Industry structure changes Affect GDP

Scale of business Strategies: R&D, field of

changes business changes
3. Legal Environment
(L environment)
 Legal environment

Law and source of law

(Luật và nguồn của luật)
 Law and Source of law

• Law is issued by the State and legally enforceable to any

citizens in the State.

• Source of law in Vietnam:

✓Statutory Law (Luật thành văn): issued by National Assembly

✓Forms of Statutory law: Law, Code (Luật, Bộ Luật)…

 Legal environment

Legal documents
system in Vietnam
(Hệ thống văn bản pháp luật Việt Nam)
 Popular Legal documents
in Vietnam

Constitution
(Hiến pháp) National Assembly
(Quốc Hội)
Law/Code
(Luật, Bộ luật)

Decree Government
(Nghị định) (Chính phủ)

Circular, Joint Circular.. Ministries

(Thông tư, Thông tư Liên tich, Quyết định…) (Các Bộ thuộc
Chính phủ)
 Legal environment

Law’s effects on
Business
 Law’s effects on business

• Law not only constraint but also assist business activity

 Law protects the consumer

• Ideally, economic theory tend to suggest that law to

protect the consumer are unnecessary because of
rationality and market forces.
• However, reality is different; most countries have
consumer protection law
• Vietnam’s Consumer protection law
 Example: “Supplemented foods
is not Drug”

Because of the law’s regulation:

Circular of Medical Ministry No. 08/2013/TT-
BYT

And a fine is given if not obeyed:

Decree No. 115/2018/NĐ-CP (Article 1, Clause
23)

Source: https://luatthiendi.com/quy-dinh-quang-cao-thuc-pham-chuc-nang.html
 4. Evironmental
Environment (“E” environment)
 E Environment issues

Issues of E
environment
 Current issues of E
environment
• Green business: green products…
• Sustainable development
• Corporate social responsibility
 Example: Green Coca cola

Plant bottle:
https://www.youtube.com/wat
ch?v=aEVVJxqWaZ8

100% new bottle made from

Recycled plastic
https://www.youtube.com/watch?v
=xkJjqK2vXQk

Source: https://www.thejournal.ie/green-coca-cola-is-a-thing-now-1922039-Feb2015/
 “E” Environment issues

“E” environment’s
effects on business
 “E” environment’s effects
on business

E environment Economic opportunities

Corporate Managing
Eco-efficiency Market niche risks
reputation
Reducing waste + (Thị trường ngách)
increase the efficiency of By developing green Current and future
Social marketing,
factors inputs products and processes environmental and
more social
regulatory of state
objectives
to protect
environment.
Choose a Company:
Choose (different from other Economic
members in class)
Environment Social
Political environment
environment
1 Real big company in Vietnam
among top 500 biggest in Vietnam: Technology
environment
https://vnr500.com.vn/ Choose some or all
environments for Legal
explanation the environment
Understand the market
impacts
Environmental
Market: only VIETNAM (compulsory) environment
 Social environment

Explain the current issues of the Social environment in Vietnam company (as guided
during the Lecture) :
3.1. Crude Birthrate and Crude Death rate
3.2. Social Class
3.3. Age structure
3.4. Life style/ Culture

Explain the impacts of Those issues to the Selected company (as guided during the
Lecture)

Opportunities of Threats to the Selected company

 Technology environment

Explain the current issues of the Technology environment in Vietnam company (as
guided during the Lecture) :

4.1. What is the current state of technological advance (cải tiến về công nghệ)?
4.2. Is technology transfer feasible?

Explain the impacts of Those issues to the Selected company (as guided during the
Lecture)

Opportunities of Threats to the Selected company

 Legal environment

Explain the current issues of the Legal environment in Vietnam company (as guided
during the Lecture) :

5.1. Name some legal documents to regulate the operation of business of the chosen company.
5.2. Is the current legal framework (khung pháp luật) likely to support or hinder (ngăn cản) business
operations of the chosen company?

Explain the impacts of Those issues to the Selected company (as guided during the
Lecture)

Opportunities of Threats to the Selected company

 Environmental
environment

Explain the current issues of the “E” environment in Vietnam company (as guided during
the Lecture) :

6. Describe some environmental pollution; climate change; green campaign which causes effect on the
business of the chosen company.

Explain the impacts of Those issues to the Selected company (as guided during the
Lecture)

Opportunities of Threats to the Selected company

THE END