Business Organisation and Environment in Global Context
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Added on 2021-02-21
Business Organisation and Environment in Global Context
Added on 2021-02-21
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BUSINESS ORGANISATIONAND ENVIRONMENT INGLOBAL CONTEXT
Table of ContentsINTRODUCTION...........................................................................................................................1BACKGROUND INFORMATION ON YOUNG LIVING...........................................................1BACKGROUND INFORMATION ON BUSINESS ENVIRONMENT.......................................3Political factors.......................................................................................................................3Economic factors....................................................................................................................3Social factors..........................................................................................................................3Technological factors.............................................................................................................3Legal factors...........................................................................................................................4Environmental factors............................................................................................................4Financial System....................................................................................................................4ANALYSIS OF BUSINESS SCENARIO BY APPLYING ANALYSTICAL APPROACHES. . .5Porter Five Forces...................................................................................................................5Demand and Supply Scheme..................................................................................................6CONCLUSION AND RECOMMENDATION...............................................................................8Recommendation....................................................................................................................8REFERENCES................................................................................................................................9
INTRODUCTIONBusiness environment refers to external and internal factors which influence operationalsituation of company (Gugler, 2017).Relocating MNC to different country is known asoffshoring where organisation relocate business process from one country to another. Expansionor relocation of business is a critical process where it is important for the management ofcompanies to analyse macro and micro environment to gain understanding over strength andopportunities. Also, when offshoring the main focus of MNC’s is to enhance relationship withkey stakeholders (Valentino and et.al., 2019). This report is about company Young Living which is multi-level marketing company thatsells essential oils and other similar products. The organisation is headquartered in Lehi, Utah,United States. The present study will outline relocation of Young living Europe HQ (EMEA)from Groningen, Holland to Finland.The study is focused on relocation of firm with the motiveof exploring foreign direct investment opportunity in Finland and therefore will outlineinformation on business environment of Finland with the help of strategical tools like Pestle,Swot and Porter five forces. BACKGROUND INFORMATION ON YOUNG LIVINGYoung living company is an American multi-level marketing company located indifferent regions like London and Holland. The company was founded in 1993 by Donald GarryYoung, who is controversial figure convicted for unlicensed practice of medicine. The companysells essential oils and beauty and health related products (Cuervo-Cazurra, 2016). The productsof Young living encourage healthy lifestyle and provide opportunities to people across the globeto follow their aspiration and achieve goals by working on passions and values. Young living is private limited company and its legal structure can be defined as limitedliability company.The company followsmulti-level marketing business model according towhich it can be said that the firm has thousands of independent distributors who sells productsdirectly to shoppers and their earning is based on commission on sales. The distributors ofcompany are aligned in hierarchical network that in synch in down lines. The individuals canearn profit from direct sales but the major money is generated from commission. 1
Figure 1: Key members of Young living(Source: Young Living Essential Oils Lc. 2019)Size of the company can be justified by its leading position as the organization is knownas leader of essential oils movement with more than 3,000 employees and 4 million members.The company continues to have extraordinary growth, which is represented in its sales of 2017which was of $ 1.5 billion. Further. Organization surpassed 41 billion in sales of last three yearswhich increased its revenue over 800 percent in last five years (Young Living Exceeds $1.5Billion in Annual Sales for 2017, 2018). Apart from this,Young living can be justified by thesales of products by its hierarchical network of distributors. In year 2017, distributors of Youngliving were assigned responsibility to make $100 of purchase per month to quality for acommission. Current international operationsYoung living has 16 corporate and partner farms across the globe and have 13 operatingoffices in 22 markets and produces and ships in 133 countries. The company is known as worldleader and in recent years the company has increased its global presence ad is continuouslyfocused on expansion (Kaplan and Kinderman, 2017). Like Young Living (European HQ) hasrecently moved from London to Holland in the light of a No-Deal Brexit and is now planningexpansion of its European business in Finland.2
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