Global Business Environment

This document provides an overview of the global business environment and its impact on the hospitality industry. It discusses the changes in the industry due to factors like recession and COVID-19. The document also explains the PESTEL analysis and its relevance to the selected industry. It concludes with insights into the challenges and opportunities in the hospitality industry.

Global Business
Environment

Table of Contents
INTRODUCTION ..........................................................................................................................3
TASK ..............................................................................................................................................4
Q.1. Introduction of hospitality industry ?..................................................................................4
Q.2. Specify the changes in the global business environment?..................................................4
Q.3. What are the impacts on the relative industry?...................................................................5
Q.4. Explain the PESTEL on the selected industry?...................................................................5
PESTLE ANALYSIS:..........................................................................................................5
CONCLUSION ...............................................................................................................................1
REFERENCES................................................................................................................................2

INTRODUCTION
Global Business environment reflects the reality of international trade it is evolve in a
fundamental manner as a result of various numerous forces shaping the nature and dynamics of
global commerce. It is widely viewed in the respect of shared, highly integrated environment.
Advancement of Technology, effectiveness of intercultural and dynamic competition are driver
to perform international business. The industry that was selected in this assignment is hospitality.
Introduction of respective choosen sector is to be given in this project. Specification of change in
the global business environment is to be describe in this report and what are the impact on the
choosen industry are also mentioned in this assignment(Aerni, P., 2018)
TASK
Q.1. Introduction of hospitality industry ?
Hospitality industry is the broad category of fields in the industry of services it includes
lodging, food as well as drink service, theme part, travel and tourism, Recreation , event planning
and transportation. Different types of hotels, motels, restaurants and bars are also a part of
hospitality industry. The main objective of this industry is to provide excellent services and give
satisfaction to their respective audience are their focus area to target. It is a multibillion dollar
industry that depends on disposable income, leisure time and complete satisfaction of customer.
A unit of hospitality like hotels, amusement park, hotels, motels include various units like
maintenance facility, direct operations ( porters, servers, house keepers, kitchen workers,
marketing, bartender management and human resource, etc. The food & beverage sector that is
professionally known by its initials like F&B is the most largest segment of this industry of
hospitality. It also includes tourism and their function is motivate audience to travel. If people
travel for business or for purpose of leisure, they spend huge amount on hospitality.
Entertainment business that provide shows like movie, place of attractions like zoos, museum,
participatory as well as spectator sports all are the parts of recreational business (Baller, 2016)
Q.2. Specify the changes in the global business environment?
Recession: In this purchasing power of employees are reduce that makes negative effect
on the business of the organisation. If the people do not have money to spend they not purchase
the good and services from employees that reduces the sale of the company. It tends to make
negative impact on revenue also. Recession reduce the customer base for the company so it

becomes difficult for the company to survive in the competitive market. It also make negative
impact on business growth (Hamilton, 2018)
COVID-19: In business environment there is a major impact in the economy because
people avoid to keep in touch with other persons, things etc. because it creates infection through
touching also. It is transmitted through droplets generated when infected person sneeze, cough
and exhales. Thus audience avoid to make direct contact and maintain social distancing to
prevent from these infection as it develop the impression of threat in the minds of public
(Charter, 2017)
Q.3. What are the impacts on the relative industry?
The negative impact of COVID -19 on hospitality are that scant passengers rattling
around inside empty air planes, abandoned hotels and large number of weddings postponed. In
this way on an average 534 million Dollars loosing by the hospitality industry and more than
12000 jobs is loose by the company daily. These calculations are based on estimation of the
looses suffer by hospitality if they continuously close or lock down for three months. Thus food
and beverage sub sector loose around 2.8 billion dollars every week. Both negative as well as
positive impact is involved. As airlines are loosing the most. The analysis report says that
airlines are suffered most with this pandemic. Hotel loose large amount in sales. For Hotel
industry the lock down being in worse position and it also creates the problems of great
recession. It make hit the hardest in the hubs of hospitality. Due to prominence of hospitality in
respected areas, these cities will likely suffer the greatest economic pangs derived directly from
the looses with in hospitality. COVID-19 induces the reduction in the purchasing power of the
audience that leads to increase recession. Due to COVID-19 the combined impact of travel
restrictions and government guidance on social distancing results cancellation or postponement
of various high profile events. The hospitality industry focus on audience loyalty, employee
commitment, trust. The COVID- 19 reduces the revenue of hotels, restaurant, events etc. because
people avoid to travel from one place to another as audience avoid or cancel their trips that affect
the business of Hotels. Due to social distancing as preventive steps, events as well as catering
services revenues are also decline because audience avoid to spent amount on events or in
catering service so it affects the business growth in terms of money( Hillary, 2017)

Q.4. Explain the PESTEL on the selected industry?
PESTLE ANALYSIS:
It is a framework to analysis the factor( Political, Economic, Sociological, Technological,
Legal and Environmental) macro environment for the organisation( Skripak, 2016). This help the
firm to take right decision at right time. These factors are flexible and can be used in different
aspects of organisation. Any industry is effecting the most is the hospitality industry. From
weather to changing governments, All these factors can impact. 2016 remained a great year for
the hospitality industry where a large number of job wee added globally. PESTLE ANALYSIS
is a means of getting future threat and opportunities so that organisation can do correct measure
to solve it ( Kirton, 2017) .
POLITICAL FACTOR- Political environment have a major impact on the hospitality
industry. Whether it is the case of changing government or formulation of any rule and
regulation. For example in Egypt, Tourism industry is struggling to grow. The problem arises in
2011 and the country is facing the tourism crisis. Tourism industry is the main revenue
generating industry and there is a positive impact of government stability(Laudon, 2016)..
ECONOMIAL FACTOR- High demand of tourism is the impact of economic growth.
This factor positively impact on hospitality industry. As the demand for hotel is healthy and will
continue to grow in the situation. The airlines brands also got the benefits from the economic
opportunities. Economy growth help the world to achieve heights (Ledgerwood, 2017)
SOCIAL FACTOR- Social factor have a great impact on hospitality industry as this
industry have to serve the guest accordingly and value the social need of the population globally.
Consumer preferences meets the product utility then industry will stand to gain in the different
parts of the world. This is the major influence of the industry to attract the customers (Rendtorff,
2017)...
TECHNOLOGICAL FACTOR- This factor have a good impact on hospitality
industry as the hotels and tourism is developing in terms of technology and achieving the heights
with the use of exclusive technology in booking of hotels and cabs. Industry is also using
advance technology in advertising. Airlines is also using information technology to serve the
customer better (Luthans, 2018)

LEGAL FACTOR - The legal environment is complex for the industry as it is because
both labour and the public security is important for the industry. There are certain law which
influence the sector but public safety and labour law are the two very important concern in public
safety(Noe, 2017)
ENVIRONMENTAL FACTOR- Sector have shifted on ecotourism and hotel is also
conducting environment friendly programs like using recycled paper bags. Thus, environment
and ecological factors have a major impact on tourism industry. Locations with more greenery
and clean, attract the large group of tourism( McCrone, 2017)
CONCLUSION
After doing deep evaluation and analysis it is to be done that concludes that hospitality
industry is one of the growing industry. Further in this file impact of recession and COVID 19
has been covered. Recession is one of the most unproductive scenario with in the economic
environment. Over that COVID -19 has drastically change the economy of the global world. In
this file with the help of PESTLE various external factors that prevail ion the environment are to
be analyse. In this project it is conclude that the pandemic makes negative impact on sales and
revenues because due to this people avoid to go on restaurants, hotels, in events, marriages so it
makes great negative impact on the world . The world faces so much difficulty in this era of
covid due to this the whole economy of the country downs but the industry can still make better
use of this lock down by investing their times in defining new concepts of delivering their
services as the industry take initiative steps by making various industries that can help in policy
making. The industry has came with their new policies and concepts as well as its great services
giving priorities to health as well as to hygiene. As due to rising requirement of basic goods and
services among audience, the behaviour of customer is change regularly to a major extent. There
fore it is very important for the hospitality industry to introduce new models that give more
opportunities to develop business. Finally it is conclude that to run business successfully everuy
organisation should analyse global business environment.

REFERENCES
Books and Journals
Aerni, P., 2018. Global business in local culture: The impact of embedded multinational
enterprises. Springer.
Baller, S., Dutta, S. and Lanvin, B., 2016. Global information technology report 2016. Geneva:
Ouranos.
Charter, M. ed., 2017. Greener marketing: A responsible approach to business. Routledge.
Hamilton, L. and Webster, P., 2018. The international business environment. Oxford University
Press.
Hillary, R. ed., 2017. Small and medium-sized enterprises and the environment: business
imperatives. Routledge.
Kirton, J. J. and Trebilcock, M. J., 2017. Hard choices, soft law: Voluntary standards in global
trade, environment and social governance. Routledge.
Laudon, K. C. and Traver, C. G., 2016. E-commerce: business, technology, society.
Ledgerwood, G. ed., 2017. Greening the boardroom: Corporate governance and business
sustainability. Routledge.
Luthans, F. and Doh, J. P., 2018. International management: Culture, strategy, and behavior.
McGraw-Hill Education.
McCrone, A., Moslener, U., d’Estais, F., Usher, E. and Grüning, C., 2017. Global trends in
renewable energy investment 2017. Bloomberg New Energy Finance.
Noe, R. A., Hollenbeck, J. R., Gerhart, B. and Wright, P. M., 2017. Human resource
management: Gaining a competitive advantage. New York, NY: McGraw-Hill
Education.
Rendtorff, J. D., 2017. Cosmopolitan business ethics: Towards a global ethos of management.
Routledge.
Skripak, S. J., 2016. Fundamentals of business. Virginia Tech.