Small and Medium Enterprises as the Backbone of any Economy

INTERNATIONAL
BUSINESS MANAGEMENT

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Contents
INTRODUCTION.................................................................................................................................1
Product that company want to expand...................................................................................................1
Environmental factors affecting the business in Malaysia.....................................................................2
External opportunities and threats.........................................................................................................4
Recommendations.................................................................................................................................6
CONCLUSION.....................................................................................................................................7
REFERENCES......................................................................................................................................8

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INTRODUCTION
Small and Medium enterprises are the backbone of any economy. This is because they
require large amount of workforce for their operations hence helps the government in
reducing the unemployment. It is also a significant contributor to the GDP of different
nations. In order to expand in different markets, company has made different types of plans
so as to improve their position in the market (KiatGan & Almsafir, 2013). For this first they
will have to identify the suitable market. Second, it is essential that companies analyses the
external environment at that place so as to find out the opportunities and threat present in the
expansion. This is extremely essential as the SME do not have large amount of financial
resources to invest and any failure could result in heavy losses for the company. Bronze
Snake is one of the leading SMEs in Australia and it is planning to expand in Malaysia. This
report analyses the product that this company wants to launch in Malaysia. It also analyses
the environmental factors that might effect on the chosen product expansion in Malaysia. At
last recommendations related to the product has been provided.
Product that company want to expand
Bronze Snake is one the emerging fashion retailers in Australia hence they aiming to make
their name in the Malaysian market. Malaysia is one of those countries that are emerging in
the South-East Asian region and is one of the best markets for expansion. The fashion items
delivered by the company are of higher quality. Along with this company offers products that
are available in different price range (Bronze Snake, 2018). Their main focus is towards the
youngsters who are in large numbers within Malaysia. Their products are designed with
different types of fabrics and hence offer trendy wears to its customers. Bronze snake has
both men and women collection offering trendy dresses. They are doing innovations in the
design so as to attract people from every segment of the society. On the other hand the choice
of the customers in Malaysia has also changed and hence the people are demanding for the
dresses that look trendy and are of high quality. Their products are available at lower cost and
offers same value when compared with products of bigger brand name. Since fashion
industry demands changes at much faster rate when compared with other industries hence
they need to make changes in their product regularly so as to remain in competition with
bigger brands.
The rules and regulations related to garment industry has changed significantly in Malaysia.
The government policies are attracting both fashion retailers and the cloth manufacturers.

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Malaysia is a $44 billion market and hence acts an important player in the South-East Region.
Recent changes in the Malaysian political momentum have resulted in the confidence booster
for both external investors and the domestic customers (Salikin, Ab Wahab & Muhammad,
2014). Along with this, another crucial fact is that fashion industry of Malaysia is having
lesser competition when compared with other South-East Asian nations. Previously fashion in
Malaysia is influenced by historical fusion of Chinese, Indian, Malay and other indigenous
cultures but in recent years the society’s affinity towards western fashion has increased. The
growth rate of the fashion industry in Malaysia is expected to experience a growth rate of
12.1%. Alone the apparel industry is expected to grow at a pace of 11.3% (Statista, 2018).
This is further boosted by the increasing tourism market in Malaysia as it is attracting
fashionable clothes in the country.
Environmental factors affecting the business in Malaysia
Malaysia is a developing nation and hence there is significant change in the environmental
factors that are affecting the business of the companies in the fashion industry. It is found that
country has a population that consists of people from different cultural and economic
backgrounds. In order to understand the external environment, the factors that need to be
analysed are:
 Political: The political environment within Malaysia is changing at much faster rate
especially after the introduction of technology in the government working. They have
fastened the process through which new investments could be made (Kasiran,
Mohamad & Chin, 2016). Censorship or prohibition was imposed by the government
previously on different types of events such as performance of international artist such
as Lady Gaga, Kesha and Beyonce. Situation has changed in the last few years and
this acts as a booster for the apparel industry in the country. Government has also
promoted the fashion that is from the local areas and outside the world. The new trade
relations between Malaysia and Australia have improved the chances of investment
across both the nations.
 Economic: For the growth of the apparel industry, it is essential that country’s
economic condition remains stable. Malaysia being an emerging economy is
promoting fashion industry. There is continuous growth that can be noticed by that
currently, it is a low income country and by 2020, it is going to become a high-income
state (Umrani, Johl & Ibrahim, 2015). It is one of the exporter nations of oil and gas