SOE11144 Global Business Economics: Analyzing Scottish Whisky Market

This report provides a comprehensive analysis of the global business economics of Scottish Whisky, focusing on the supply side, demand side in target markets like the United Arab Emirates, and relevant economic theories. It examines the whisky's premium status, market differentiation in the UK and UAE, currency exchange impacts, and the availability of substitute products. The report further explores macroeconomic factors like political stability and economic growth in the UAE, assessing their influence on the whisky market. Key economic theories, such as the growth theory of economics, are applied to support the practical analysis, highlighting the importance of customer expectations and purchasing power in driving business growth. The report concludes by identifying profit-making opportunities within the target market, emphasizing the potential for expansion and development for Scottish Whisky in the UAE.

SOE11144- GLOBAL
BUSINESS ECONOMICS
AND FINANCE

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
1) Supply side of Scottish Whisky...............................................................................................3
2. Demand side of the target market............................................................................................5
3. Economic theory to support the practical analysis..................................................................7
4. Opportunity to make profit in market......................................................................................8
CONCLUSION................................................................................................................................9
REFERENCES................................................................................................................................9

INTRODUCTION
Business environment is a sum of various factors and elements influence the business
operations of the venture. This report is based on the case study of Whisky in respect to its
progression under the business environment. Henceforth, report will emphasis on the product
identification and it's differentiating areas associated with organisation. Statistical data will also
be represented associated with the UK market and the target market of United Arab Emirates.
Furthermore, macroeconomic environment of the target country and especially by evaluating the
factors like political and economic will also discuss in this project. Microeconomic demand
factors will also come under observation in this report. Economic theories will further discuss
assessing the whole situation at a practical level. Suitable profit making opportunity the target
market will offer is also a part of discussion in this report.
MAIN BODY
1) Supply side of Scottish Whisky
The Whisky is a premium product that initially was founded in the 15th century. Currently
the Scottish Whisky enjoy in 175 countries that clearly state the high demand of the product in
the international market. The product contain all characteristic that allow the product line as a
premium one for all the alcoholic enthusiast looking forward to consume the respective product
line. The market segment of United Kingdom and the United Arab Emirates are both different in
nature. In the United Kingdom from a very long time people started consuming the Scottish
Whisky. The internal level of differentiation clearly indicate the fact that United Kingdom is
already a well-established market for the Scottish Whisky consumption. United Arab Emirates
on the other hand is not well explored in context to this product line. Also the market structure in
the United Arab Emirates is well-structured that support the organisation to entertain the massive
growth and development opportunities in the target market sector. The buying power at the new
target country is much more than the United Kingdom. The income in the target market is much
more advanced in comparison to the United Kingdom. The one dollar is equivalent to the
approximately .75 GBP whereas, One dhirum is equivalent to the .27 dollar (Afari Djan, 2020).
This is clearly indicating about the fact that the currency in the United Arab Emirates is more
powerful in comparison to the pound. Further the currency exchange between one dhirum is
equate only ..20 GBP which that clearly state the fact that the currency under the United Arab
Emirates is way more powerful than the currency value of pound.

The supply management system at the United Arab Emirates is also well advanced in
comparison to the United Kingdom. As the target country is more advanced and developed due
to its economic feasibility the advancement is channelised in all aspect of business operations
and areas. There are many substitute products are available that can replace the whisky that
include wine, beer and such like of products. The availability of the substitute products become a
massive threat for the Scottish Whisky as customers would be attracted towards consuming the
respective product line (Aristarco, 2020). This further challenge the sector and companies part of
the sector to charge the reasonable and desirable prices against offering the products to end
customers. In both the markets such as United Kingdom and the United Arab Emirates there are
plenty of alternative available that highly challenge the business venture to meet business
objectives by engaging in the respective market sector. The role of the sector is very essential
and significant in nature to support overall growth and development of the sector. There are also
sufficient alternative brands available in the individual substitute product associated with the
Scottish Whisky. This fundamentally influence the growth and development of the sector in
respective target market.
The United Kingdom is a huge market in term of alcohol consumption. Currently the
market is offering a turnover of approximately 45 billion which will further be expanded to 54.9
billion by the end of the year 2025. The sector is growing rapidly at a rate of 3.1% that is
impressive in context to the United Kingdom where every sector is equally developed. This
growth rate and expected values of the turnover clearly demonstrate about the significance of the
sector in enhancing the business growth and the value of the sector in front of the potential
stakeholder group. In context to the United Arab Emirates the sector contain almost 2 billion of
revenue of the industry (Bowen, 2017). This further expected to grow by almost 4% that clearly
indicate about the growth possibility and potential of the sector in front of the stakeholder. The
figures and statistics clearly demonstrate the feature of the economy and the growth potential of
the sector or market that can provide the best level of business expansion possibilities to the
Scottish Whisky.
2. Demand side of the target market
Macroeconomics is a sum of various external factor of business environment that
precisely support the organisation to approach the overall growth in the respective target market.
Political and economic are the two core elements associated with the macroeconomic that

immensely support the organisation to channelises the business operations. The role of the
macroeconomic factors are fundamental and allow the business venture to dispose the best form
of growth and development possibilities in the respective target market.
Political factor
Political factor demonstrate about the core macroeconomic element or factor influence
the business functions. This is comprises with the political situation in the country. The role of
the political factor is fundamental in order to approach the business functions and operations in
the respective target market. Government holds a very string and dominating situation or position
at both United Kingdom and the United Arab Emirates that support the political party to deliver
the most stable policy making towards every single business direction. This become necessary
for the business dimensions that government in the country hold the string political position or
situation in the market. The role of the government is to provide a right policy to the stakeholder
for delivering the various business operations (Carberry, 2019). The stable political situation
always favour and empower the government to sustain the policy for long time duration. The
government in both regions understand the significance of the business environment and the
growth of the corporate in the overall development of the whole country.
The growth of the nation is only delegate with the support of advancement and
development of the corporate world. The government try to channelize the policy where it
provides a subsidy to the new business houses and benefits in tax so that they can make strong
presence in the market. Stable government further allow the ventures and business houses to
sustain the policy and strategies of business for longer time duration. Political environment in the
United Arab Emirates will be the most progressive factor that will support the Scottish Whisky
to improve its business scale in the market. Also the political stability would further be allowed
the company to formulate the long driven policy making to deliver the business operations. In
context to the internal perspective of business formulation of the long driven policies and
sustainable practice would empower the business unit to approach the best possible business
outcome in the market (Frankopan, 2020). This become essential for the business houses to
experience the good political culture and environment. The government in the United Arab
Emirates is very progressive in nature in term of leadership which empower the business venture
to sustain a long term policy that further support and motivate the business unit to progress all its
operations in a certain specific direction.

Economic factor
Economic factor demonstrate about the economic situation and position of the economy
in the market. The United Arab Emirates is economically well advanced and rich. The economy
of the country is growing at a rate of 1.7% that support the country to approach the massive
growth and development possibilities (Kirshner, 2020). In context to the developed countries like
United Arab Emirates this is a very progressive growth rate that indicate a very positive situation
and position of the economy in the respective market. Also the per capita income of the people in
country is 70300 PPP that further demonstrate that the buying power at the people in country is
very good. The Scottish Whisky is a premium range of product that require strong purchasing
power of the target customers (Ghosh and Siddique, 2017). The buying capacity of the customers
in the United Arab Emirates allow the people to afford the Scottish Whisky.
The inflation in economy is also well controlled that further supported the purchasing
capacity of the potential customers under the respective target market. Currency exchange value
of the United Arab Emirates is also very dominating that allow the people to spend more in
premium product range. All this support the Scottish Whisky to have a very effective external
influence over the growth of sector. Internally also companies require positive economic
environment that can allow and support the best form of product success. Especially in context to
the premium product range like Scottish Whisky buying power and income of people in country
become a significant factor or element drive the overall success of the business in respective
target market. The above stated elements or factors demonstrate the key macroeconomic
elements or factors influence the business operations and guide about the positive growth and
development situation of the Scottish Whisky.
The macroeconomic demand factors include employment is among the key prominent
element. The business expansion at the United Arab Emirates will allow the business unit to
generate the employment opportunity in the region. This will motivate the business unit to
sustain an effective employment opportunity for all the professionals and graduates. Inflation in
the economy of the United Arab Emirates is also very progressive and prominent which allow
and support the business unit to sustain a massive growth and development opportunities in the
market. This further suport the buying power and capacity of the potential or target customers in
the respective market (Haressy, 2018). The role of inflation is to reduce the value of currency for
the customers. Interest rate in the country is also very affordable that will further allow the

organisation to generate the financial requirements. This will motivate the stakeholder to ensure
mitigation of all its financial need and demand of the organisation. Consumer confidence will
also be gained by the company as the Scottish Whisky contain a premium nature that will
motivate the organisation to attract the interest of the target customers in the market. Also the
buying power will empower the potential customers to easily afford the Scottish Whisky.
3. Economic theory to support the practical analysis
Economic theories demonstrate about the various concepts of economics that influence
the business operations of the company (Smelova, 2017). These theories contain a huge role in
delivering the business operations as a venture. The involvement of these theories is to motivate
the stakeholder to take the best suitable business decisions for enhancing and motivating the
overall growth and development opportunities as a business unit.
Growth theory of economics
This is a theory of economics that indicate the growth perspective of the business
venture. This theory has clearly indicated about the ways and indicate all different approaches
that can support growth of the venture. This theory has interlinked growth with the customer
expectations, perspectives, desires and wants of the customers. The basic feature of this theory
indicate that growth of business is highly influenced with the target customer in the market. The
business can only improve its development opportunity by attracting the buying decision of the
customer in market. In order to address the buying decision company need to convince the wants
and desire and expectations of the customers in market (Nzimande, 2019). The life style of the
people at the United Arab Emirates allow them to consume premium products. Scottish Whisky
has a great scope of growth in the target market. As the product lie will support the choices and
preferences of the target customers in market so that launch of this product will be a massive
success pronominal for the company.
Keynesian theory
This is another major economics theory that give emphasis to the fiscal policy, monetary
policy and such like economics elements. All these are the features of economics that support the
stakeholder to make important business decisions. This theory has given a huge emphasis to
monitor the fiscal and monetary policy for supporting the growth of the business. Due to the
stable political condition in United Arab Emirates government get a huge motivation to system
the respective policies for delivering the business objectives and to achieve the aim of business

expansion (Odoemene, 2017). The inflation rate in the economy is also under the 2% which
clearly demonstrate that the currency exchange rate is string in the country that can maximize the
overall growth of the economy.
The above stated economic theories supported the Scottish Whisky to take business
expansion decision. The market at the United Arab Emirates is very progressive in nature that
allow the Scottish Whisky to positively enter into the target market.
4. Opportunity to make profit in market
The United Arab Emirates is a very developed market. The country is considered as
highly developed due to its economic wealth and possibilities to thrive the whole world. People
own a sufficient finances and resources that can empower and support the customers to go
towards premium products (Razzaque, 2020). Scottish Whisky is considered as a premium
quality of product line that require the customer economically well strengthened to make a
buying decision. People of country are entitled to consume the premium quality of beverage
drink. This is a part of the lifestyle of people in country. The taste of the Scottish Whisky is also
unique that will surely gain the attraction of the customers in market (Percival and Percival,
2017). The launch of the Scottish Whisky will further be engaged with the media attraction due
to its characteristics and lavish brand image. The customers in the market highly appreciate the
launch of new product or brand and also want to experience the new product line that can meet
specific need and requirements of customers. Also the culture at the country motivate the people
to enjoy every occasion and host parties which can be owned with the Scottish Whisky. There is
a great opportunity for expanding business in the United Arab Emirates. Also the product will
engage with the interest of the target customers in the respective market.
CONCLUSION
Scottish Whisky is aiming to launch in United Arab Emirates. The country hold a very
strong economic situation that can empower the company to enhance and boost the growth of the
organisation in respective target market. The per capita income, inflation rate, buying power,
GDP growth rate and such like of elements strongly support the organisation to expand the
business in the country. The target customers also like to experience the premium product line
that further support the organisation to entertain the growth and development opportunities in the
market.

REFERENCES
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