Global Business Environment | Assignment

Global Business

Table of Contents
INTRODUCTION...........................................................................................................................1
2. Economic Environment...............................................................................................................1
3. Political Environment and Risk...................................................................................................3
4. Business Environment.................................................................................................................5
5. Country choice.............................................................................................................................5
CONCLUSION................................................................................................................................6
REFERENCE ..................................................................................................................................7

INTRODUCTION
Global business means business at international level that is used to make more profits for
the organisation. It helps to contribute in gross domestic product by doing business all over the
world. An organisation is running a business around the world consider as global industry that
helps to increase the GDP rate. The main purpose of this report is to know the value of global
business and how to do (Doh, McGuire and Ozaki, 2015). Zimmerman, & Blythe, 2017)). To
understand the value of global business B health has been taken which is Australian company
and provides baby foods. It doing its business at international level and raising profitable activity
by selling products and services. This report will covered analysis of economical, political and
environmental factor of New Zealand and Hong Kong.
2. Economic Environment
Economy, strength and challenges
The economy refers a system of industry and association that is used to serve or involves
manufacture and classification of resources among people of society. It can be divided in to
market system and command that shows economical position of the country. The economy of
Australia is a great mixed market economy whose GDP is A$1.69 trillion. It includes GDP rate
that states economy's output and production in Australia. Moreover, GDP rate of Australia defies
total economic value of product and services (Dyllick and Muff, 2016). The GDP rate of New
Zealand and Hong Kong are shows as-
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GDP rate of New Zealand
The economy of New Zealand advanced 0.6 percent on forth quarter of 2018 and
expanding 0.3 percent in past period after comparison to market forecast. In 2017, GDP in New
Zealand was 205.85 billion US dollars. It shows 0.33 percent of the world economy. The service
sector increased 0.9 percent , that was 0.5 percent greater than third quarter (GDP of New
Zealand. 2019).
Strength:
New Zealand leaders are successful in in building teams that helps to meets with strategic
and long term objectives of the organisation. In this country employees of any organisation are
able to define vision and goals for enterprise and build confidence in strategic direction.
Challenges:
Lack of consultation may be a challenge for organisation because organisation want to
become changes and for this it need to provide training and development. Moreover poor
communication and failure to learn affect any organisation that reduce the profits as well as
growth rate of economy (Evans and Gawer, 2016).
GDP rate of Hong Kong
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In 2017, GDP in Hong Kong was 341.45 billion US dollars that shows 0.55 percent of the
world economy. The Hong Kong's economy is 0.3 percent on quarterly basis in December 2018
which is greater than previous quarter that was 0.1 percent. Export of goods expanded 2.7
percent and services grew up by 0.7 percent (GDP of Hong Kong. 2019).
Strength:
It helps to create customer focused leadership that helps to motivate staff by focusing on
business. It also create customer relationship that shows customer focused behaviour and healthy
work environment. Moreover, it helps to increase business activities by providing information.
Challenges:
There may be chances of low profit and GDP growth rate because lack of project
planning that may create confusion among members and employees. Moreover, it can create
unemployment situation because not low position of company. Inflation rate may be high hence
low productivity (Gooris and Peeters, 2016).
3. Political Environment and Risk
Political system: This system helps to make official government decision which is taken
by the government. It compares to economic system, legal system, social and cultural system that
helps to make effective business decision. The main purpose of this report is to bring people
together in order to achieve control of the government, built relevant policy for creating public
interest. Such as, in Australia the prime minister is appointed by General Governor who make
policies and regulation for social welfare and increase productivity. B Health is providing baby
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food to customers that keeps healthy and make feel them good. B health is facing following
priorities and challenges in order to run a business at global level such as-
Current priorities-
To provide best quality of food to children that helps to grow up rapidly. To reduce the
death rate of children who are dying because lack of food. To increase relationship with other
country that will helps to increase business activities. There is need to focus on people demand
and expectation that will helps to produce more products as customer wants (Kasemsap, 2016).
Challenges-
To expand business at global level B Health faces different problems such as language
and culture of different country, changes in environment and people's taste, high competition at
market place that has chances to reduce the sell of baby products. Tax rate and inflation rate are
most effectual challenges that may affect any business.
Trade relationship with Australia
This means B Health is an organisation who is running a business in Australia and want
to expand its business at global level. Its main target is to manufacture and distribute baby foods
in Hong Kong and New Zealand that helps to increase business image and will maintain business
activities. For expanding business there is need to have trade relationship with Hong Kong and
New Zealand. In B Health company, manager should maintain a relation with these country and
provide a benefit that will help help to adopt new technology in order to increase business
(Kaynak and Lee, 2018).
Political Risk factor
This means some factors such as political stability, tax rate and corruption, who can affect
B Health business in Australia that has chances to reduce profit margin by increasing risk. It
involves following factors such as-
Political stability: This is needed factor to run a business effectively and reduce the
business risk. If political stability will not be stable in Australia then investment will be reduced
and economic speed will also reduce. Hence, the political stability helps to reduce risk in order to
increase business at international level (Motohashi, 2015).
Corruption: This factor also may affect the Australia's B Health organisation business
such as if there is corruption in Australia manager of the B Health industry has to pay high tax
rate hence low profit margin (Rugman and Verbeke, 2017).
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4. Business Environment
Ease of Doing business
This means economies are getting rank according to ease of doing business. It shows
through a report such as New Zealand has topped the Ease of doing business rank in 2017 and
2018 (Salvatore, 2015).
Market potential
B Health is trading business across the border of Australia that helps to run a business
effectively and maintain productivity in New Zealand and Hong Kong. Moreover, B Healthy
focuses on relevant industry that provides best quality of material and customer trends that shows
habits or behaviour of customer for products and services. It track and keep information that
what people wants and how much they can spend.
B Health also focuses on online business that helps to attract customers in order to
increase profits and making decisions. It also provide baby foods through online system that
make feel good and make easy available. Moreover, it helps to increase market potential by
providing food and increasing production (Wood and et.al., 2015).
5. Country choice
A weighted index is used for decision making purpose that helps to run a business at
global level by comparing between two countries. Such as, Weighted index of New Zealand and
Hong Kong are designed as below by considering above mentioned market potential qualities.
Variable Weighting
New Zealand Hong Kong
Score
Adjusted
Score Score
Adjusted
Score
Potential market 20.00% 9 1.8 6 1.2
Wealth Distribution 15.00% 8 1.2 5 0.75
Economic freedom 15.00% 5 0.75 7 1.05
Taxation & Tariffs 30.00% 6 1.8 7 2.1
Political Stability 20.00% 8 1.6 6 1.2
Total 100.00% 7.15 6.3
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CONCLUSION
From the above report it has been concluded that Global business is helpful to make more
profits as organisation wants. Business all over the world is known as global business and
international level that helps to make business decisions. This report covered economical
environment the shows economical position of the company and political system that gives ideas
to make investment decision. Moreover over, this report contained market potential that shows
ease of doing business, trading across the border, political stability and tax and tariffs that is used
to make weighted index.
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REFERENCE
Books and Journal
Doh, J., McGuire, S., & Ozaki, T. (2015). The Journal of World Business Special Issue: Global
governance and international nonmarket strategies: Introduction to the special
issue. Journal of World Business. 50(2). 256-261.
Dyllick, T., & Muff, K. (2016). Clarifying the meaning of sustainable business: Introducing a
typology from business-as-usual to true business sustainability. Organization &
Environment. 29(2). 156-174.
Evans, P. C., & Gawer, A. (2016). The rise of the platform enterprise: a global survey.
Gooris, J., & Peeters, C. (2016). Fragmenting global business processes: A protection for
proprietary information. Journal of International Business Studies. 47(5). 535-562.
Kasemsap, K. (2016). The roles of lean and green supply chain management strategies in the
global business environments. In Designing and implementing global supply chain
management (pp. 152-173). IGI Global.
Kaynak, E., & Lee, K. H. (Eds.). (2018). Global Business: Asia-Pacific Dimensions (Vol. 14).
Routledge.
Motohashi, K. (2015). Global business strategy: Multinational corporations venturing into
emerging markets. Tokyo: Springer Open.
Rugman, A., & Verbeke, A. (2017). Global corporate strategy and trade policy. Routledge.
Salvatore, D. (2015). Managerial economics in a global economy. OUP Catalogue.
Wood, D. J., and et.al, (2015). Global Business Citizenship: A Transformative Framework for
Ethics and Sustainable Capitalism: A Transformative Framework for Ethics and
Sustainable Capitalism. Routledge.
Zimmerman, A., & Blythe, J. (2017). Business to business marketing management: A global
perspective. Routledge.
Online
GDP of New Zealand. 2019. [Online]. Available through:
<https://tradingeconomics.com/new-zealand/gdp>
GDP of Hong Kong. 2019. [Online]. Available through:
<https://tradingeconomics.com/hong-kong/gdp>
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