Virgin Co. Pestle Analysis
On 10 November 2016, “Virgin Care won a £700m contract to run 200 National Health Service and social care services”. From April 1st 2017, with public healthcare privatised, “Virgin Care will become the prime provider of a wide range of” healthcare in the United Kingdom (UK) for “seven years”, the contract including “an option to extend it by another three years at the same price”. (Campbell D., 20116)
Previously, due to “the uncertainty caused by the British vote to leave the European Union (Brexit)”, Virgin Money Holdings (UK) postponed launching “a banking service for small businesses” and focused “on developing a digital-only offering” instead. (Treanor J., 2016) Richard Branson also said on Good Morning Britain (2016) that it “lost about a third of its value”.
Meanwhile in 2014, as the first fully licensed mobile virtual network operator (MVNO) in Saudi Arabia, Virgin Mobile Middle East and Africa has become the fastest growing MVNO in the region with 2.5 million customers. (“Virgin Moble MEA announced today that”, 2016)
Richard Branson also lost Virgin America to a merger in 2016 due to his shares changed into non-voting shares by the United States (US) Department of Transportation on the account of him not being an American citizen. (Hackett R., 2016)
With “sluggish economic growth, weak global trade and diminishing capital flows” to be expected for 2017 (The World Bank, 2016), Virgin Group’s diversified global assets will certainly be negatively affected.
Additionally, despite UK’s employment rate being at an eleven year low of 4.8% in November 2016, expected increased unemployment over Brexit, signs of a cooling labour market and slowing employment growth (“UK unemployment rate”, 2016) will further worsen the impact on Virgin Group due to the decrease in their consumers’ disposable income.
Tourism however, is gradually recovering in Mexico, Latin America and the Caribbean while declining in the Middle East and Russia (The World Bank, 2016),