An Uncertain Future PESTEL Analysis post Russia Ukraine War (2023)

PESTLE Analysis of Rite Aid Corporation: An Uncertain Future in light of Russia Ukraine War

Rite Aid Corporation (Rite Aid) shareholders had turned down a US$3 million bonus proposed for the chief executive officer (CEO) and elected a new board chair. Under the CEO's leadership, Rite Aid ha...

Rite Aid Corporation: An Uncertain Future case study written by By David Wood and Ken Mark and has business operations that directly and indirectly are impacted by Russia Ukraine war. Some of the PESTEL Analysis factors that are impacting the Rite Aid Corporation: An Uncertain Future business environment are –

War in Russia and Ukraine, loss of market opportunities in Russia & Ukraine, rising housing debt and increasing mortgage rates, financial collapse in emerging markets , slowing growth rates across the world , high inflation , technological changes such as ChatGPT and AI , geopolitical developments such as increasing competition between US and China, crypto currency frauds and crash , high government debts , end of an era of easy liquidity, big tech shares collapse , and increasing food and fertilizer prices
Check out more Harvard Business Review Case Studies Solutions

An Uncertain Future PESTEL Analysis post Russia Ukraine War (1)

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Slowing Growth Rate [Political & Economic Factors]

– As the Fed has decided to do whatever it takes to bring down the inflation to 2%, it will result in high interest rates and slowing growth rates across the world. Rite Aid Corporation: An Uncertain Future needs to build resilience to survive in the slowing economy. It can do so by focusing on fast developing emerging economies, building product offerings that can cater to lower spending rates of the consumers in the industry.

Increase in commodities prices [Political & Economic Factors]

– As Russia is one of the biggest suppliers of commodities in the world, the sanctions on Russia by United States and European Union has led to the increase in cost of commodities across the world. Rite Aid Corporation: An Uncertain Future needs to keep a close eye on the commodities prices to have a sustainable business model.

Emergence of AI and other automation technologies [Technology Factors]

– ChatGPT has brought new excitement to the field of Artificial Intelligence and automation. Even though the technology right now is in nascent stage, it has potential to disrupt the economic system in the coming decade. The Chinese government has even banned the use of ChatGPT in the country.

Bursting of Crypto Bubble [Economic Factors]

– Cheap money and government lockdowns led to the speculation and bubble in Crypto currency segment. The crash has wiped out savings of millions of people across the world. Secondly it has burned the young investors for a decade.

Extremely high government debt [Political & Economic Factors]

– The debt levels in both the developed countries and emerging markets have increased because of the COVID spending and strengthening dollar. This has put financial health of numerous countries in danger. In October 2022, we saw a run on GBP when government declared tax cuts. Similarly the Debt to GDP ratio in most developed countries is above 80%, which is not sustainable in the long run.

(Video) Ukrainian Counteroffensive. Phase I [Mapped]

Technology war / Chips war [Technology Factors]

– CHIPS and Science Act passed in 2022 has not only aimed to encourage more CHIP investment in United States but also preventing companies to manufacture and ship high end chips to China that could be used in military hardware. This only marks the beginning of technology restrictions and economic competition. It also makes tech companies vulnerable to not only direct sanctions but also to secondary sanctions by United States.

Business in a hyper political world [Political & Economic Factors]

– Businesses now have to focus more on the political and legal factors in the PESTEL analysis. In the last 20 years, under the WTO regime, businesses can rely on fairly consistent rule of law across the world. Two words that have captured business imagination because of the war between Russia and Ukraine are – Friendly Countries, and Friend Shoring. Now businesses have to make decision not only based on operational efficiency and financial considerations, but also keeping in mind the political and geopolitical risks.

Order a Rite Aid Corporation: An Uncertain Future PESTEL / PEST / STEP Analysis now

High Private Debt [Political & Economic Factors]

– In 2023 in an environment of rising interest rates, private debt in United States is extremely high. There is 16.1 trillion USD in household debt, 12 trillion USD in mortgage debt, 1.6 trillion USD in auto loans, and 1 trillion in credit card debt. 67% of the retired Americans already have an unpaid credit card debt. This point towards an extremely fragile situation if US enters into a recession.

Over Reliance on Supply Chain based out of China [Economic Factors]

– Covid exposed companies to the scenario where the whole supply chain can be disrupted if one country is shut down. Now companies are trying to diversify the supply chains geographically. This will result in not only increase in costs but also prevalent operations strategy of “Just in Time”. Politicians especially in United States and UK are putting pressure on companies to locate supply chain in liberal democracies and friendly countries.

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Increasing cost of doing business [Economic Factors]

– As the growing considerations are on diversifying supply chain away from China, geographical diversification, friendshoring – building manufacturing and other supply chain in friendly countries, it will increase the cost of doing business not only for transnational companies but also on the local companies. Businesses have to make higher inventory provision, tolerate greater inefficiencies, and ensure high due diligence in source of material and its usage.

Emergence of Two Different Global Orders [ Political Factor]

– The war between Russia and Ukraine is fast resulting into emergence of two rivalling groups in the international orders. Ukraine is backed by the western countries and Russia is backed by the world’s second biggest economy China. This can result into not only geo-strategic competition but also economic rivalries based on the political leanings.

Increasing Housing Payments [Social & Economic Factors]

– Over the last one year the mortgage payments have increased almost 60%. The mortgage payment now accounts for almost 33% of the average US homeowner income. The 33% share is far higher than the long term average of around 24% and just below the all time high of 34% in 2006. The trend suggests that a lot of households will be either struggle to make their payments or drastically cut down on the spending, or both. It points towards a looming housing market crash and recession.

19.Food Crisis [Social & Economic Factors]

– Ukraine and Russian war is impacting the global food market in two ways – first Russia, Belarus, and Ukraine are few of the biggest fertilizer suppliers in the world, secondly Russia and Ukraine accounts for nearly 25% of the global wheat exports. The reduction on both fertilizer and wheat exports can lead to increase in food crisis in not only least developing countries in Africa but also in wealthy countries in Middle East such as Saudi Arabia, Qatar, UAE and Egypt.

Lockdowns in China [Political & Economic Factors]

– The continuous zero lockdown policy in China not only disrupted the global supply chains but also reduced the demand for players such as Apple. Apple has decided to reduce the production of iPhones in 2023 not only because of supply chain disruptions in China but also because it expects lower demand from China and other major economies.

(Video) A Strategic Analysis of the Russo-Ukraine War | Richard Iron CMG OBE

Increasing defence budgets [Political & Economic Factors]

– The war between Russia and Ukraine has put an end to an era where governments can put defence resources into healthcare and education. Now as governments across Western Europe and North America focus on putting minimum 2% of the GDP on defence spending, we will witness a reduction of spending in healthcare and education. It will also lead to less money for foreign aid and donations to build in infrastructure in developing world. This can result in not only fewer resources for health agencies and education departments, but also can increase immigration to the Western European countries and United States.

Increasing Debt on Credit Cards in United States [Social & Economic Factors]

– Another distress sign in the US economy in 2023 is the rising debt on credit cards in United States. Rite Aid Corporation: An Uncertain Future will be seriously impacted by this trend because most of the purchases of its products in the industry are done on credit. 67% of the retired Americans have already unpaid credit card debt. If the financial markets crash then retired Americans will face challenges to meet their expenses from the retirement savings.

High Inflation Rate across the Western World [ Economic Factor ]

– United States and other western countries are witnessing inflation above 7-8% in 2022 and it has not come down significantly enough to allow central banks to reduce the interest rates. The high inflation is because of multiple reasons such as – commodities shortages because of war between Russia and Ukraine, COVID stimulus that slushed huge amount of liquidity in the system, and China’s zero Covid policy and supply chain disruptions. Check out more Harvard Business Review Case Studies Solutions

Rising Interest Rates in United States and other Developed Economies [Economic Factors]

– – As the inflation rate is above 8% in the most of developed world, central banks are actively cutting rates to control the inflation. Rite Aid Corporation: An Uncertain Future should strive to cut costs by streamlining operations and workforce, reduce dependence on customers’s discretionary spending.

Increasing cost of climate change and natural disasters [Environmental Factors]

– The increasing intensity of hurricanes into United States, extreme heat season in Canada and Europe, floods in Pakistan, and extreme winter temperatures in United States suggest that the governments have to deal with increasing costs of climate change both in terms of infrastructure damage and rising energy costs to manage the extreme weather.

(Video) Ukraine war: Russia says UK officials ‘legitimate military targets’

Books and References

Ahir Gopaldas and Anton Siebert (2022 July August) "What You’re Getting Wrong About Customer Journeys", Harvard Business Review , 92
Linda A. Hill, Emily Tedards, and Taran Swan (2021) "Drive Innovation with Better Decision-Making", Harvard Business Review 86
Dyer, J. H., & Hatch, N. (2004). Using Supplier Networks to Learn Faster. Sloan Management Review, 45(3), 57–63
Barney, J. B. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17, 99–120
Dyer, J. H., Kale, P., & Singh, H. (2004, July–August). When to ally and when to acquire. Harvard Business Review, 109–115

MBA Admission help, MBA Assignment Help, MBA Case Study Help, Online Analytics Live Classes


What is the effect of the Russia Ukraine war on the future? ›

The war in Ukraine was a “massive and historic energy shock” to the markets, according to a November 2022 report by the OECD. The “shock” of the war was one of the main factors that had slowed economic growth in 2022 to just 3.1 percent, and why the OECD projected it to slow to 2.2 percent in 2023.

What do you think the impact of the war in Ukraine on the whole world? ›


The war disrupted global trade that was still recovering from the pandemic. Food prices have soared, since Russia and Ukraine are major suppliers of wheat and sunflower oil, and Russia is the world's top fertilizer producer.

How does the war in Ukraine affect the energy markets? ›

In terms of energy (fossil fuel) prices, the 2022 Russian invasion of Ukraine (was an economic shock that) cost consumers or buyers (in the world) primarily 2.85% of the pre-invasion annual GDP ($2.7 trillion) in five months following the invasion.

How does the Russia Ukraine invasion war affect the supply of oil in the global market? ›

Russia's war in Ukraine is causing a profound and permanent shift in the world's oil markets, creating new geopolitical alliances. Analysts say it's comparable to the 1970s Arab oil embargo. ARI SHAPIRO, HOST: Russia's war in Ukraine has implications far beyond the battlefield, including energy.

How has the Ukraine war affected businesses? ›

Our survey-based study shows that the war is causing a great deal of uncertainty in many companies, with 41 percent still unable to assess the impact on their business. As a result of the war in Ukraine, 46 percent expect a drop in sales and 47 percent a drop in earnings.

How does Russia and Ukraine affect the world economy? ›

Russia and Ukraine make up 25-30% of global exports of wheat and a significant share of sunflower seeds. The higher price of wheat alone, up by more than 50% as of 7 March, could add more than one percentage point to UK inflation.

What are the negative effects of war? ›

Death, injury, sexual violence, malnutrition, illness, and disability are some of the most threatening physical consequences of war, while post-traumatic stress disorder (PTSD), depression, and anxiety are some of the emotional effects.

How did the Russia Ukraine war affect humanity? ›

Since Russia's full-scale invasion in 2022, its war against Ukraine has had a disastrous impact on civilian life, killing thousands of civilians, injuring many thousands more, and destroying civilian property and infrastructure.

How does war affect the economy? ›

Putting aside the very real human cost, war has also serious economic costs – damage to infrastructure, a decline in the working population, inflation, shortages, uncertainty, a rise in debt and disruption to normal economic activity.

How does the Russian Ukraine war affect energy? ›

The economic disruption caused by the war in Ukraine has amplified calls for an accelerated energy transition. A shift that would move countries away from highly polluting fuels, often supplied by only a handful of major producers, to sources of low carbon energy such as renewables and nuclear.

Why is the Ukraine war affecting the economy? ›

The war – while not being the key factor explaining the slower-than-anticipated economic growth in 2022 and downgraded forecasts for 2023 – weighed negatively on global economic activity, adding to inflationary pressures worldwide and impeding the post-pandemic recovery.

How the war in Ukraine is affecting supply chain? ›

Grain exports out of Ukraine dropped significantly at the start of the war with some recovery through the Black Sea Initiative (an agreement allowing Ukraine to export grain). Declines in agricultural exports will be highly significant such 50% in sunflower oil, 25% for maize and a decrease of 10% for wheat.

What oil companies are affected by Ukraine war? ›

But the crisis gives western oil and gas companies such as BP, Shell, Exxon and Total leverage among governments.

Where does the US get its oil? ›

Petroleum imports from Canada have increased significantly since the 1990s, and Canada is now the largest single source of U.S. total petroleum and crude oil imports. In 2022, Canada was the source of 52% of U.S. gross total petroleum imports and 60% of gross crude oil imports.

What is the impact of the war in Ukraine on the price of commodities? ›

Commodity price increase due to the Russia-Ukraine war 2022

Global wheat prices increased by over 60 percent over the period from February 24 to June 1, 2022 compared to the average in January 2022. The growth was explained by the Russia-Ukraine war, as Russia and Ukraine were among the leading wheat exporters.

How does the Russian Ukraine war affect small businesses? ›

Respondents reported a considerable negative impact on their businesses. On average, income decreased by 43 per cent and employment by 22 per cent.

What industries are affected by Ukraine crisis? ›

Russia's invasion of Ukraine has already heavily impacted global commodities markets and, as the military conflict is likely to be protracted, uncertainty in the steel, oil, and energy markets.

What is the impact on Ukraine crisis on oil & gas sector? ›

Oil prices were rising globally even prior to the full escalation of the war. However, when Russia attacked Ukraine, the price of crude oil in the global market skyrocketed from around $76 per barrel at the start of January 2022 to over $110 per barrel on 4 March 2022.

How does war affect the economy positively? ›

Producing weapons and munitions is counted positively, while killing people and destroying things is not counted at all. On the one hand, war can increase GDP per capita by reducing unemployment and by shifting people from family formation and other nonmarket activities into wartime production.

What were the environmental consequences of the Ukraine conflict? ›

More than 12 thousand square kilometres of Ukraine's nature reserves have become a war zone. Populations of rare endemic and migrant species suffered great losses, birds were forced to abandon nests and change their usual migration routes. The efforts of decades-long conservation projects were ruined.

How does the Russian Ukraine conflict affect the economy of India? ›

In April 2022, 2 months after Russia's invasion of Ukraine, India's retail inflation jumped to 8-year high of 7.79% and remained above the Reserve Bank of India's (RBI) tolerance band of 2-6%.

What are 3 impacts of war? ›

War destroys communities and families and often disrupts the development of the social and economic fabric of nations. The effects of war include long-term physical and psychological harm to children and adults, as well as reduction in material and human capital.

What are two negative outcomes of a war? ›

The negative impacts that result from war include loss of life, destruction of cities and the environment, and human suffering. The human suffering includes injury, sexual violence, malnutrition, illness and disability. These are some of the physical consequences of war.

What are the 5 consequences of conflict? ›

Consequences of Conflict
  • High degree of cohesion: Inter-group conflict gives rise to commitment and loyalty amongst members of the group. ...
  • Improvement in quality of decision: ...
  • Emergence of leader: ...
  • Response to change: ...
  • Increased Productivity: ...
  • Releases strain:

What are the social effects of the Ukraine war? ›

The Ukraine war and subsequent cost-of-living crisis means that the poorest children are even less likely to access essential services and are more at risk of child marriage, violence, exploitation and abuse. For many, childhood poverty lasts a lifetime.

How does war affect human life? ›

Effects of war also include mass destruction of cities and have long lasting effects on a country's economy. Armed conflict has important indirect negative consequences on infrastructure, public health provision, and social order. These indirect consequences are often overlooked and unappreciated.

How is the war affecting Russian economy? ›

Russia has responded with sanctions of its own. Both the conflict and the sanctions have had a strongly negative impact on the world economic recovery during the COVID-19 recession. As a result of its war, estimates of a 30-year economic setback are projected for Russia.

Why does war cause inflation? ›

Federal deficits would increase: Wars, in general, are inflationary. Wars involve significant expenditures to employ, transport, arm, and feed troops. Military conflicts also involve purchasing weapons, ammunition, and military equipment.

What do countries gain from war? ›

The basic story with spending on a war, or any other military spending, is that it provides a boost to demand in the economy. In this sense, it is like anything else that would provide a boost in demand, such as increased spending on health care, child care or housing.

How does war affect the environment? ›

Bombing and other methods of modern warfare directly harm wildlife and biodiversity. Pollution from war contaminates bodies of water, soil, and air. Warfare releases greenhouse gas emissions. Even in peacetime, militaries consume extreme amounts of dirty energy.

How does war affect oil prices? ›

When the wars occur, due to the large amount of utilization of weapons, the demand for the raw material oil will hugely increase, and meanwhile the supply of the oil will be trapped in shortage. Hence, the price of the oil began fluctuating.

What do we rely on Ukraine for? ›

Metals. Russia and Ukraine lead the global production of metals such as nickel, copper and iron. They are also largely involved in the export and manufacture of other essential raw materials like neon, palladium and platinum.

What fossil fuels are in Ukraine? ›

Ukraine's abundant coal reserves account for more than 90% of the country's fossil fuel reserves. They include the full range of coal types, from anthracite to lignite, including thermal and coking coal.

What important exports does Russia supply? ›

The most recent exports are led by Crude Petroleum ($113B), Refined Petroleum ($81.8B), Petroleum Gas ($37.7B), Coal Briquettes ($19.1B), and Gold ($19.1B). The most common destination for the exports of Russia are China ($70.9B), Netherlands ($39B), United States ($27.4B), United Kingdom ($24.7B), and Italy ($22.2B).

How has the US responded to Russia's invasion? ›

The response of the United States to the ongoing Russian invasion of Ukraine that began in 2022 has been in favor of Ukraine. President Biden condemned the invasion, providing military and humanitarian aid to Ukraine, and sanctioning Russia and Belarus, the countries heavily involved in invading Ukraine.

Why is Ukraine so important to Russia? ›

Russia has deep cultural, economic, and political bonds with Ukraine, and in many ways Ukraine is central to Russia's identity and vision for itself in the world. Family ties. Russia and Ukraine have strong familial bonds that go back centuries.

What are the supply issues due to Ukraine conflict? ›

Among the issues identified were the disruption of key supplies, supplier failures, low inventories, the use of single or sole source suppliers, the global shortage of commodities and raw material, the transportation problems at docks and depots and of course, labor shortages.

How does the war in Ukraine affect oil prices? ›

In the wake of Russia's invasion of Ukraine, global oil prices soared to more than $120 a barrel amid concerns about a shortfall in global supplies from Russia. But they have fallen sharply since then as the global economy slows down and countries use less oil.

What does Ukraine supply the most? ›

Ukraine is normally the world's top producer of sunflower meal, oil, and seed and the world's top exporter of sunflower meal and oil.

What are the effects of Russia and Ukraine war on the environment? ›

The 2022 Russian invasion of Ukraine has led to widespread and possibly serious and long-term environmental damage. Explosions inflict toxic damage along with physical destruction. After every explosion particles of toxic substances; such as lead, mercury and depleted uranium; are released into air, water, and soils.

What is the impact of the war on the Ukrainian economy? ›

Summary. Almost eight months of Russian war against Ukraine has had a detrimental impact on Ukraine's economy. Ukraine's real GDP could fall by 35-40 percent by the end of 2022. The opening of the grain corridor and international financial support provide a glimmer of hope for the improvement of the situation.

What are the effects of the Russia Ukraine war on climate change? ›

During the first seven months of the war, the fighting released some 100 million tonnes of carbon into the atmosphere, as well as the sabotage to the two Nord Stream pipelines in September 2022, which led to the biggest ever point source release of methane – a potent warming gas.

How war can affect global economy? ›

War and inflation

In many circumstances, war can lead to inflation – which leads to loss of people's savings, rise in uncertainty and loss of confidence in the financial system.

How does war affect the environment and human life? ›

Land and resource use

often displace people from their lands and homes. Military activity uses solvents, fuels and other toxic chemicals which can leach toxins into the environment that remain there for decades and even centuries. Furthermore, heavy military vehicles can cause damage to soil and infrastructure.

How does war cause damage to the world? ›

War causes pollution incidents which are industrial in their scope. Oil or energy facilities are deliberately attacked. Scorched earth techniques include the destruction of agricultural infrastructure, like canals, wells and pumps, leading to transboundary impacts of contamination of rivers, aquifers or the sea.

What major environmental issues affect Russia and what caused them? ›

Deforestation and logging

It is estimated that Russia loses $1 billion every year due to illegal logging. According to the Center for Russian Environmental Policy, 16 million hectares of forest are lost each year to a variety of causes, including logging, pollution, and fires.

What are the effects of war? ›

War destroys communities and families and often disrupts the development of the social and economic fabric of nations. The effects of war include long-term physical and psychological harm to children and adults, as well as reduction in material and human capital.

How does war affect climate change? ›

Militaries consume enormous amounts of fossil fuels, which contributes directly to global warming. If the US military were a country, for example, it would have the 47th highest emissions total worldwide. Bombings and other methods of modern warfare directly harm wildlife and biodiversity.

What are the effects of climate change in Russia? ›

Temperature changes until now

At present, the average annual temperature in the western regions of Russia rises by 0.4 – 0.5 °C every decade. This is due to both an increase in the number of warm days, and also a decrease in the number of cold days, since the 1970s.

What are the after effects of war? ›

Effects of war also include mass destruction of cities and have long lasting effects on a country's economy. Armed conflict has important indirect negative consequences on infrastructure, public health provision, and social order. These indirect consequences are often overlooked and unappreciated.

Why does war increase inflation? ›

Federal deficits would increase: Wars, in general, are inflationary. Wars involve significant expenditures to employ, transport, arm, and feed troops. Military conflicts also involve purchasing weapons, ammunition, and military equipment.


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