Challenges and Strategies in International Business Expansion

This report discusses the challenges faced by multinational companies in expanding their business operations across borders and provides strategies to overcome them. It also analyzes the progress made by Apple in establishing itself in the Chinese market and evaluates their international functional strategies.

International Business
Module

Contents
Introduction.................................................................................................................................................3
Challenges facing multi-national companies and how to overcome them...................................................3
What are the problems MNEs face? How can they overcome problems?................................................3
What are the risks of operating across borders? How can they mitigate risks?.......................................4
Apply some international theory..............................................................................................................4
What specific challenges are there in operating within emerging markets?.............................................5
Bring in your own international experiences...........................................................................................5
The organisation..........................................................................................................................................5
Assess the progress made by the organisation in establishing itself in market from first planning its
entry strategy until now...........................................................................................................................5
Analyze environment of emerging market concerned. Justify your decision and include key statistics. .5
Map out their functional areas and international operations/supply chain/trading patterns......................6
Evaluate the organisation’s strategies: first for international entry, then for organising and structuring
its global operations, and finally for maintaining competitive advantage in the face of new challenges
and changing conditions..........................................................................................................................6
Evaluate how effective their international functional strategies are (operations, marketing, HR, R&D)
and their spread across different countries...............................................................................................6
What decisions have they made when operating as a multi-national? How effective, or not were these
decisions and how could they have been improved, or alternative decisions made.................................7
Specific challenges......................................................................................................................................7
Conclusions.................................................................................................................................................7
Recommendations.......................................................................................................................................8
References...................................................................................................................................................9

Introduction
Every company want to expand their business at the international level because through
that they able to attain gain several benefits such as increase customer’s base, enhance profit,
market shares and so on (Bowe and Dowson, 2020). This will also help a company in enhancing
their competitive advantage in the effective manner as they are operating at the worldwide level.
For conducting this report case study of apple expanding business at China is taken. Apple is
introduced by Steve Jobs, Ronald Wayne and Steve Wozniak in 1976. Its head office is located
at the California, United State and their business is nested at the worldwide level. Topics
mentioned in respective report are based on the problems and risk faced by Amazon and means
which they adopted to overcome. Moreover, it also includes functional strategies as well as
decisions taken by MNC for conducting business across borders.
Challenges facing multi-national companies and how to overcome them
What are the problems MNEs face? How can they overcome problems?
There are several challenges or problems which are faced by MNE’s while conducting
their business operations and functions. Some of the main problems faced by MNE’s are
mentioned below:-
 Market imperfection – Multinational companies are operating their business at the
different countries and every company has different laws, customer preference, and
economic condition and so on (Chainer, Parida and Schultz, 2020). Accordingly which a
company management need to develop strategies and plans which impact on the ability of
management as their work burden get increased.
 Political instability – There are several multinational companies experienced challenges
related to the political instability while conducting their business in the international
markets. Respective issues are generally take place when there is absence of proper
government authority.

These are main issues or problems which are faced by multinational companies while running or
expanding business at different locations. In respect of this they may adopt different methods
such as:
 Companies first need to conduct proper market analysis as well as they also need to
analyse past cases of different companies as that will help in analysing their mistakes
which they will not repeat.
 Multinational companies also need to hire local expertise and employees as that will help
in decision making according to the respective market requirement and need.
What are the risks of operating across borders? How can they mitigate risks?
There are several risk which are faced by a company while expanding their business
operations and functions across borders, from which some risk are mentioned below:-
 Political risk – According to this risk when a company conduct business at international
level they experienced political risk because policies of country get change rapidly as
well as companies management need to develop or improve strategies accordingly (Di
Domenico and et. al., 2020).
 Shipping risk – When a company conduct business at the international level they need to
conduct shipping at the local or abroad level. They will face risk related to loss,
vandalism, breakage, theft, accident, contamination and many more.
In order to avoid these risks while operating business across border company management need
to select proper shipment procedure as well as conduct proper tracking of it so that there will be
less chance of issues as well as they also need to develop strategies according to new policies.
Apply some international theory
In order to conduct trading at the international market a company may adopt different
international theory such as product life cycle, which explanation is mentioned below:-
 Introduction – At this stage management will introduce their products and services at the
different market and conduct huge promotion activities for attracting customers.
 Growth – On this stage company will experience in growth in their sales which leads to
increase in profit as well as market shares successfully (Draijer, 2020).

 Maturity – In this phase company sales will be at peak in the new market so they need to
develop strategies for marinating that level.
 Decline – The last phase is decline in which company need to adopt new strategies and
plan for enhancing their sales.
What specific challenges are there in operating within emerging markets?
When a company is operating at the international level or emerging market they
experience several challenges such as issues related to domestic infrastructure, financial
infrastructure, political stability, fractured supply chain, product diversion (Gschwind and
Salapura, 2020). Rapid change in customer demand, region entrance regulations and many more
issues.
Bring in your own international experiences
By conducting analysis related to challenges faced by a company when conducting at the
international market I determined that there are some main issues such as regular change in
customer’s demand and requirement, political instability, change in economic condition of firm,
fractured supply chain and many more.
The organisation
Assess the progress made by the organisation in establishing itself in market from first planning
its entry strategy until now
At the starting Apple able to expand their market effectively at the China market as they
able to attract more and more customers of same market (Apple in China (2015), 2020). But after
some time their business get impacted through china competitive companies as they also started
manufacturing similar features mobile phone as well as they offer it at the low price. But now in
order to sustain in market company make loyal customers and offer innovative features in their
iPhone in order to attract more customers.
Analyze environment of emerging market concerned. Justify your decision and include key
statistics
There are several aspects which Apple need to concerned while conducting or
introducing into emerging market such as culture of nation, political factor, legal aspects, and

social demean and many more. It is essential for Apple to consider culture because that will help
in understanding customer’s perspective and reaction related to products such as in china people
are attracted toward with new technology so that is opportunity for respective company.
Similarly they also need to considered other aspects as that help in decision making process.
Map out their functional areas and international operations/supply chain/trading patterns
Functional areas of respective company are marketing, human resource, designing,
operation, financing and many more as that will them in conducting their business operations and
functions in effective manner which leads to attainment of desire goal successfully (Hult,
Gonzalez-Perez and Lagerström, 2020). Apple generally conducts their business at the
international level as they have high skilled labour which conducts work properly for attaining
desire goal.
Evaluate the organisation’s strategies: first for international entry, then for organising and
structuring its global operations, and finally for maintaining competitive advantage in the face of
new challenges and changing conditions.
In order to enter into the China market Apple open or launch a new store so that they can
attract more and more audiences towards their business, products and services effectively. in
order to operate their effectively respective company train their employees as well as they also
hire local employees which help in decision making effectively. Along with this after some time
competitors starting impacting on the Apple business at local business also develop product
similar to the apple features so in order to regain trust or customer loyalty Apple started
introducing more innovative products.
Evaluate how effective their international functional strategies are (operations, marketing, HR,
R&D) and their spread across different countries
The functional strategies like operations, human resource, marketing and research and
development are effective as that will help Apple in conducting business at the international level
successful manner. In addition to this respective company are operating their business at the
several different companies such as United kingdom, United State, India, Germany and many
more (Vandenberg, 2020). Moreover their international functional strategies are that their
research and development department conduct research first then marketing and human resource
develop strategies for introducing into new market effectively. Along with this employees of

Apple are highly skilled, knowledgeable and capable who adopt change effectively and
successfully.
What decisions have they made when operating as a multi-national? How effective, or not were
these decisions and how could they have been improved, or alternative decisions made
When a company is operating at the multinational level they need to considered several
practices such as adopt new technology, develop decision according to country culture, economy
and political situation as well as it is also essential to provide training to employees so that they
adopt strategies effectively which help in conducting work in effective manner. These aspects or
factors will help a company in adopting change effective as well as it also help in expanding
business at the international market in successful manner (Vandenberg, 2020). but at some point
of time these are not consider as effective decision because some time employees not ready to
adopt change, financial issues may take place and many more. In order to improve this company
may adopt new technology as well as they also motivate employees to adopt changes.
Specific challenges
In respect of expanding business at the international market a company may adopt
different model or theory such as product life cycle, marketing mix and many others as that will
help in determining new market according to which company management able to develop
decision and strategies successfully. While this some challenges may arise such as employees are
not ready to adopt change, employees are under skilled, frequent change in culture, social
requirement as well as planning is not conducted properly. So it is essential for company
management to understand challenges and develop strategies accordingly.
Conclusions
By conducting analysis of above mentioned topics it can be summarized and determined
that every company want to conduct their business at the international level because through that
they able to enhance their business operation areas which leads to increase in sales, customer’s
base, profitability ratio, market shares and many more. Before expanding business at the
international market a company need to conduct several analyses related to market and
workplace as that will help in developing effective strategies as well as plan which leads to

succession of business. Along with this, they may also adopt numbers of models as that will
provide appropriate guidelines for the development of strategies as well as plans successfully and
effectively.
Recommendations
By conducting evaluation situation it can be determined that for every company it is
essential to develop proper strategies and plan while expanding their business at the international
level. There are also several recommendations for the Apple so that they can effectively operate
business at the china market such as they may conduct market analysis as well as they also need
to conduct study of past cases related to the multinational companies operating at the same
nation. Moreover they also need to first launch product at few location of china in order to
determine customers as well as competitor’s reactions.


References
Books and Journals
Bowe, D. and Dowson, P., 2020. International Experiences.
Chainer, T.J., Parida, P.R. and Schultz, M.D., International Business Machines Corp,
2020. Energy efficiency based control for a cooling system. U.S. Patent 10,653,044.
Di Domenico and et. al., 2020. Organizational collaboration: Themes and issues. Routledge.
Draijer, C., 2020. Best practices of business simulation with SAP R/3. Journal of Information
Systems Education. 15(3). p.5.
Gschwind, M.K. and Salapura, V., International Business Machines Corp, 2020. Initializing a
data structure for use in predicting table of contents pointer values. U.S. Patent
10,705,973.
Hult, G.T.M., Gonzalez-Perez, M.A. and Lagerström, K., 2020. The theoretical evolution and
use of the Uppsala Model of internationalization in the international business
ecosystem. Journal of International Business Studies. 51(1). pp.38-49.
Vandenberg, R.J., 2020. Multilevel models in international business research: A commentary.
In Research methods in international business (pp. 433-438). Palgrave Macmillan,
Cham.
Online
Apple in China (2015). 2020. [Online]. Available through:<
https://www.icmrindia.org/casestudies/catalogue/Economics/ECON051.htm>.