Although the physical environment is not considered one of the core components of the SLEPT factors, it is an environment that can impact upon your success in exports and consequently needs to be considered.
A country’s territorial size, geographical location, natural resources, climate, rivers, lakes and forests constitute its physical environment. The physical environment influences political and economic activities, shapes cultural characteristics such as language and religion, and determines land usage, transportation, and commercial flows.
When planning international marketing activities, the possible impact of the physical environment should take into account. For example:
- Population distribution will be affected by topography (i.e. a country’s rivers, mountains, deserts, etc.) and climate – people tend to settle where the climate is temperate, and there is an adequate supply of water.
- Certain climatic conditions may dictate adaptations to the product – some glues and oils, for example, will not function in very cold climates.
- Climate should also influence the arrangements made in respect of packaging (in the marketing context) and protective packing for the purposes of safeguarding the product while it is in transit or in storage. Products which are particularly vulnerable to climatic conditions, are those that are adversely affected by extremes in temperature or excessive humidity changes (fruits being transported to hot climates or across the equator, for example).
- Abnormal weather conditions (e.g. typhoon season in Asia) can disrupt the transportation of export products while unforeseen changes in the weather can threaten companies which produce seasonal goods.
- Topography will influence the routing of goods and the choice of transport mode, which in turn will affect cost and thus impact on the price offered to the buyer.