Navigating Global Business Trends

Introduction

One of the significant changes within the global business trends in the last twenty years has been rapid but sustained growth of international business. Markets have become global in true sense. As stated by Phadermrod, Crowder and Wills (2019, p. 194) world product trade expanded by 6% a year since the last decade. In the global foreign market billions of dollars are transacted and many of these financial activities take place in the European markets. The pervasive growth in regards to market interpenetration makes it difficult for the country to be not influenced by such external forces. International businesses these days are seen to gain immense prominence and needs to be researched for providing better strategic plans. The current essay thus works on underpinning the prospects of developing a strategic plan or consider investment abroad without analysing the market. As per evidence as previous research literature, the essay would support the argument, that it is important to plan before making an investment to avoid the chances of risk and possible financial problems For the most comprehensive insights into strategic planning in the area of international business, seeking business dissertation help can offer the most valuable guidance.

Political

Analysis of political scenarios is termed is one of the prime reasons that makes the business possible within a foreign market. The impact of the political scenario can be rightly explained through the use of Brexit as a suitable example. As per reports, in 2015, the UK reported £133 billion in goods to the rest of the European Union, almost half of global goods exported (Bloom, and Bunn, 2019). Thus, it is perceived that the business in the UK would be subjected to financial loss of £4.5 billion in a year, provided that leave in European Union without negotiating the trade agreement with the EU (Eisenberg, 2019). This could adversely hit the business within the UK hiking the taxes. It would conversely result the UK businesses to be less competitive in the local European markets and even on the global platform. However, stated Bashir and Verma (2017, p. 7) if the business chooses to maintain a competitive edge by decreasing the prices of the products and prices means lower price levels.

Hence, it is important to understand the changing political scenario and the ways it can influence business. A suitable answer to challenging political scenario was given by Amazon in India. Last December, the Indian government published a circular that banned Amazon from selling products from those business organizations which they have equity at stake. The law states that firms could no longer remain in exclusive selling arrangements with sellers or provide steep discounts to the customers on the basis of the mentioned deals. As influenced by Hamilton and Webster (2018), foreign direct investment would be allowed within the domain of e-commerce providing marketplace for the buyers and sellers as per the new rules. In similar regards, the giant e-commerce business was termed to be a major reason for financial loss among the retail shopkeepers. The advent of the online e-commerce market can work on creating potential problems for the business. Amazon was visibly aware of the prospects of capturing the Indian market due to the rising rates of disposable income and digitalisation of services. It is for the same reason that the giant ecommerce business turned to glocal approach and worked on partnering with local retailers for ensuring a symbiotic relationship and better profit margins. Thus to quote Sandada and Mahoko (2016), it can be clearly stated implementation of strategic intervention to answer the political instability is the right way of maintaining business sustainability. It is after careful planning, the CEO of Amazon, Jeff Bezos plans to invest 1 billion despite the severe backlash faced by the company (Ellis-Petersen, 2020). The move in the mentioned context can be termed risky, especially during the presence of riots. However, if Amazon comes out clean and is cleared of all the charges, then this strategic move can help Amazon in business expansion.

Legal

The Diesel gate scandal can be termed as one of the most important legal breach in the history of the automobile business. The German automaker faked the emission level of roughly 580,000 automobiles sold in between 2006 to 2015 using a software that was used to pass the emission tests (Environmental Defence, 2020). However, the emission level was comparatively higher than the limits allowed. The effect of the scandal was disastrous to both the internal and external stakeholders. The scandal was so severe that Winterkorn, a senior executive was subjected to seven years imprisonment and even lost his job along with other senior executives. In the US, Volkswagen sensed the market opportunity as the competitors within the US market faced immense difficulty in implementing the diesel vehicle technology.

The overwhelming wish to dominate the US market with greener vehicles turned out to be the biggest mistake by Volkswagen. It would have been a smaller scandal if the company made small violations. The incident gave a massive blow to the company's reputation. The business did not make enough research to understand the potential implication related to breach of emission control, then it could have saved the business from shame. Most of the cars were recalled and the company was subjected to huge loss and insult. The image of the company was subjected to degrading conditions as a number of losses were suffered. As influenced by Mylan (2017, p. 283), a strategic planning addressed to answer the consequence of potential legal breach. There remains a scope of regaining the company reputation by ensuring that the future of the company is subjected to harassment in future. The dedication to diesel adds to the possible challenges making the automakers lose technology. The automobile companies breaking the rules, expensive legal fines and settlements were levied that exceeded $22 million in the US (Environmental Defence, 2020). The funds collected could have been implemented in research and development just as the changes to sustainable technology threaten the traditional automobile makers obsolete. Hence, it can be conclusively stated that business organizations need to keep on track the legal legislations for ensuring smooth business operations.

Economic

Consumer behaviour is highly influenced by a series of factors, the economic factor is one of them. Electrical retail chain Comet Group can be termed as one such brand that worked on recharging batteries of wireless radios for the customers. In the early 1950s the demand for wireless radios was to rise and the founder took advantage of the situation opening the first retail store. In alignment to the Resale Prices Act (1964), Comet’s business was subjected to growth providing immense levels of discounts (Managers.org.uk, 2015). In between the excessive business growth, the UK retail chains were competing to get greater market share providing a wide range of discounts. Comet needs to compete aggressively in order to beat the other retailers. The global economic crash can be termed as the final blow to the economic condition. Economic gap or economic inequality can be termed as one of the greatest factors that can make or break the business. For instance, the US has been leading the global economy for the past three decades. On one hand it may provide advantages, later may lead to a series of disadvantages. Citing the work of Böcker and Meelen (2016, p. 20), working for the countries with poorer economic condition may be termed useful during the course of outsourcing. American companies such as Accenture are often seen to outsource their business processes to India due to the existing economic disparity.

Some economists are often seen to argue the fact that economic disparity is a sign of economic affluence. Aithal (2016, p. 4) maintains long term market patterns to show pull towards the aspect of wealth concentration. As supported by Eisenberg (2019), in the short term when inequality is limited, relatively low levels of investment may lead to limited levels of profit which may not be a strategic move for a business. The economic inequality has greater manifestation other than the ones mentioned in preceding sections. For instance, economic inequality can act as a major barrier for businesses operating in consumer goods. Luxury brands such as Zara, Louis Vuitton are known for their high price and quality products. The excessive prices may be a bit high for countries such as India to pay for exclusive items where the economic inequality is on the higher side and the wealth is concentrated only in the hands of some people. Tesco is a great example of unsuccessful business venture due to poor research pertaining to cash flow of the chosen country. For instance, the Indian market creates a high demand for consumer goods due to the high amount of population. In addition to that, the cash flow model in India does not support online transactions. Hence, it can be conclusively stated marketing strategies should be clear enough to support the economic disparity. As stated by Phadermrod, Crowder and Wills (2016, p. 200), the generic strategies to marketing such as differentiation and cost leadership can be termed as innovative ways of ensuring ways to address economic issues.

Technology

Online shopping is the latest trend, in this digital era retailers must work on providing compelling reasons to buy in store. As pointed out by Sandada and Mahoko (2016, p. 7), purchase related to online platforms may be increased; however, the physical retailers are far from dead. Judging the holistic Asian markets, it was seen that the majority of the customers were subjected to poor levels of infrastructure. The poor infrastructure made it difficult for them to access the internet. Furthermore, the physical retail stores can be termed as one of the leading sources of purchase due to the level of security related to payment offered to the customers.

In similar regards, IKEA was a business that aimed to shift to an online platform. However, the business was subjected to poor growth as the customers expected physical retail outlets for their furniture and consumer goods related products, they needed to establish cross functional teams. As supported by Mylan (2017, p. 283), in order to form a cross functional team, collaborating across all channels, it is important to view the operations from the perspective of the consumer and develop an engaging environment. The engaging environment works on developing brand loyalty. The shortage of technical skills can impact the core business functions. A leading Irish daily suggests that a deficit in IT skills cost the enterprise 1 million euros in the last year (O'Brien, 2020). Lack of technical skills lead to financial loss, 41% claimed that the business failed to scale up as per expectations, as they lacked the needed technical infrastructure. 25% of respondents additionally stated that poor technical infrastructure can give rise to cybersecurity threats such as ransomware attacks (O'Brien, 2020)

Conclusion

Thus, on the basis of the above study it can be conclusively stated, analysing the business environment makes it easier for the managers understand the factors that can possibly affect the business. When it comes to the development of new products, analysing the business environment can be termed useful in developing deeper understanding and strategic thinking about factors such as legal aspects and technical trends. Analysis of the business environment helps the leaders to make strategic financial investments. Thus, it becomes important to note the fact that analysing the business environment.

Evidence based study additionally explores the fact that managers often work on analysing the business environment before making any financial commitment. In a similar vein, it is important to understand, fact that analysing the business environment can help in exploiting the scope that arises due to a series of external factors. For instance, economic conditions such as low level of interest rate within the real estate industry, works on creating a demand for residential and commercial spaces, as the housing loans are affordable during the season of low interest rates. Thus, it can be conclusively stated, it is important to make sure that the business environments are rightly assessed for providing strategic advantage

Reference list

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