Global Business Environment: Opportunities and Challenges for JD Sports in India

This report discusses the opportunities and challenges faced by JD Sports in India, including the application of business environment theories such as Pestle analysis and Hofstede cultural dimensions. It also covers aspects of corporate governance, business strategy, and cultural sensitivity, as well as barriers faced by foreign businesses in India.

Global Business
Environment

Table of Contents
TASK 1............................................................................................................................................3
INTRODUCTION ..........................................................................................................................3
About the chosen developing country..............................................................................................3
Application of Theories of business environment on the selected context/country........................4
Critical evaluation of opportunities and challenges that are present and how to manage aspects of
corporate governance, business strategy and cultural sensitivity....................................................7
Discuss and analyze the different barriers experienced by foreign businesses in the selected
country supported by different examples.........................................................................................8
Provide appropriate strategies and other relevant recommendations to enable the company to
succeed in the selected developing country.....................................................................................9
CONCLUSION .............................................................................................................................10
REFERENCES..............................................................................................................................11
TASK 2 .........................................................................................................................................12
Introduction....................................................................................................................................12
PESTLE analysis.......................................................................................................................12
SWOT analysis..........................................................................................................................14
Pestle analysis on the basis of SWOT analysis.........................................................................14
Conclusion.....................................................................................................................................15
References......................................................................................................................................16

TASK 1
INTRODUCTION
The global business environment is said to be an environment including various
sovereign nations along with factors that are external to domestic environment of country. It
impacts decision-making process of company operating in a country regarding utilisation of
organisational resources as well as capabilities. Within this report, JD Sports Fashion Plc is taken
into consideration which is a UK-based organisation founded in the year 1981 by John Wardle
and David Makin. It deals in sportswear and provides exclusive products and services to its
potential customer-base within marketplace (Aerni, 2018). JD Sports wants to move its
production facilities to another developing country hence, the chosen developing country which
will demonstrate different aspects of this report is India. This report covers application of
multiple theories of business environment such as Pestle analysis, Hofstede cultural dimensions,
etc. It also includes opportunities and challenges that exist along with process of managing
aspects of corporate governance, business strategy and cultural sensitivity while operating
business in chosen country. Moreover, distinct barriers that are faced by global businesses in
chosen developing country will be discussed and analysed. Additionally, appropriate strategies
and other recommendations will be provided for enabling company to achieve success and
growth in chosen developing country.
About the chosen developing country
The chosen developing country in this report is India and the reason behind selecting
India as a developing country is that it has a wide scope in retail industry because of its healthy
economic growth, dynamic demographic profile, enhancing disposable income, urbanisation and
many more factors (Ahmad, Omar and Quoquab, 2020). These factors assist India in achieving
its success and growth within the retail industry and drive its growth in well-organised retail
market in an effective and efficient manner. The retail market in India is growing at a rapid rate
and with more than 1billion people, the respective developing country is extreme attractive
market for home as well as international retail players. The people in India are having diverse
taste and preferences in products of retail market and it will provide a competitive edge to JD
Sports as the company is engaged in offering a large number of products like apparels, footwear,
accessories and recreational products in retail industry.

Application of Theories of business environment on the selected
context/country
There are multiple theories of business environment that help in analysing opportunities
as well as challenges that exist in business environment. Some of these business environmental
theories include Pestle Analysis, Hofstede Cultural Dimensions, etc. These theories are explained
as under in context to JD Sports while moving production facilities in India:
PESTLE Analysis
It is a tool that helps in analysing the impact of macro-environmental factors existing
within a country that influences the functioning of an organisation (Alshare and Sewailem,
2018). JD Sport should use this theory for evaluating and analysing impact of such factors at
time of moving its production facilities in India:
 Political factors: Such factors are associated with government guidelines, rules and
regulations, policies, political stability, etc. In relation to JD Sports, company should be
aware of changing governmental policies and rules of India in which it wants to move its
production facilities because changes in such political factors like trade restrictions can
influence performance of organisation adversely.
 Economic factors: These factors include inflation rate, interest rate, exchange rate,
economic lockdown and many more. In context to JD Sports, economic factors such as
taxation policy and inflation might impact business operations of company in a negative
way. Hence, company should be aware of such factors and adopt appropriate business
strategies for sustaining within marketplace while moving production facilities in India.
 Social factors: These factors consist of lifestyle, taste and preference, expectations of
customers, health consciousness and many others (Amankwah-Amoah, Khan and
Osabutey, 2021). In relation to JD Sports, company must understand varied perceptions
as well as taste and preferences of Indian customers regarding footwear, apparels, etc.
and then produce and design products for them. This will help company in capturing
more market share which will boost sales volume and profitability of company.
 Technological factors: It includes advancements in technologies which impact
functioning of business. JD Sports should use highly developed and upgraded
technologies as well as machines while performing production facilities in India such as

producing sportswear, apparels, etc. This will save both business cost and precious time
and positively influence performance of organisation.
 Legal factors: Such factors include laws and legislations that are framed by legislative
system of a country and their impact on organisational performance. In context to JD
Sports, company must follow employee health and safety laws that are framed by Indian
legislative system for maintaining employee retention (Belyaeva and Lopatkova, 2020).
This will enhance productivity and efficiency of organisation in a great way.
 Environmental factors: Such factors consist of weather, pollution, climate, CSR,
environmental laws, etc. that affects business functioning. In relation to JD Sports,
organisation must adhere environmental laws of India for gaining competitive edge and
attracting more customers within Indian marketplace.
Model of Porter's Five Forces
This tool facilitates in analysing competition level within an industry and how other
companies are operating at diverse levels of profits. There are different forces that are involved
under this model and these are described as below in relation to JD Sports:
 Competitive Rivalry: There are various competitors of JD Sports that are active within
Indian markets such as Nike, Skechers, etc. Hence, there is high threat of competitive
rivalries within the retail industry as it may reduce profitability of company. In order to
overcome such threat, organisation is required to frame effective business strategies for
chasing competitive edge over competitors in Indian Markets.
 Threat of New Entrants: This force is based on entry of new businesses within a
specific industry and in relation to JD Sports, the company has to manage all challenges
and identify barriers for gaining competitive advantage within retail industry (Bhasin and
Garg, 2020). Hence, there is moderate threat of new entrants and to overcome such threat,
organisation can place a low pricing strategy, adopt cost reduction and offering new
values to its Indian customers for operating business easily.
 Threat of bargaining power of customers: In extent of JD Sports, organisation offers
best quality products and at less possible cost. Hence, there is a low threat of bargaining
power of customers as Indian customers will not switch to another organisation to buy
their products and this will enlarge the customer-base within Indian markets.

 Threat of bargaining power of suppliers: In context to JD Sports, suppliers are at
dominant position in retail industry which can reduce profitability of company. In such
manner, company may not switch to another supplier as it will supply its products at
more price. Hence, there is a high threat of bargaining power of suppliers because it can
reduce profit margins of organisation. The company overcome such threat through
tackling power by developing effective supply-chain.
 Threat of substitutes: The force of threat of substitutes relies on factors such as product
differentiation, rivalry's profit and so on (Das and Kundu, 2018). Hence, there is a high
threat of substitutes because competitors of JD Sports offering substitute products of
company at less cost which may minimise profit margins of the organisation.
Hofstede Cultural Model
The model of Hofstede Cultural Dimensions will help managers of JD Sports in
understanding various cultures of varied nations. There are mainly five dimensions of this
cultural model which are mentioned as under:
 Power Distant Index: This is said to be a power index that gets adopted by JD Sports
managers for reducing inequalities and managing changes that encouraged power among
team members with improving organisational performance.
 Individualism vs Collectivism: At JD Sports, company should primarily focus on
collectivism as India is having collectivism strategy wherein all employees are invited to
come as well as take participation in multiple business activities along with adopting
relevant Indian culture (Gupta and Minai, 2019). This will be beneficial for organisation
and its manpower as it will increase business performance and productivity.
 Masculinity vs Femininity: In relation to JD Sports, the company should adopt
masculinity as there is masculinism in India and hence, it will positively impact business
functioning of respective organisation as men have more capacity in comparison to
women which will increase productivity and efficiency of company.
 Uncertainty Avoidance Index: In relation to JD Sports, India is the lowest ranking
dimension in Uncertainty Avoidance at 40 in comparison to world's average of 65.
Therefore, company should consider this factor effectively and appropriately for
conducting business operations in a successful manner.

 Restraint vs Indulgence: India has restraint culture as it gets a low score of 26 in such
dimension. In context to JD Sports, the company should understand the perceptions and
taste as well as preferences of the customers of India. This will help in capturing a large
number of market share which will boost profitability of the company.
Critical evaluation of opportunities and challenges that are present and how
to manage aspects of corporate governance, business strategy and cultural
sensitivity
Opportunity and challenges of J.D Sports: There are various opportunity and threats
are faced by J.D Sports during expanding business in the market of India. It is important for the
business to analyse these opportunities and threats as well as develop effective strategies
planning to gain competitive advantages in India (Hartono and Kusumawardhani, 2019).
Through expanding business in India, J.D Sports can expand its market place and acquire more
customers that will help business to enhance its sales and profitability ratio. On the other hand,
competition create threat for business and direct impact on organisational performance and
profitability ratio in developing market.
Corporate governance: Corporate governance is defined as the system through which company
is controlled and directed. Organisational board of director is responsible for business
governance. J.D Sports need to maintain governance framework, develop effective policies and
implement laws and regulations in business practice manage corporate governance In developing
country and gain long-term competitive advantages.
Business strategy: Business strategy is defined as the clear set of actions, plans and goals that
direct business operations to perform in specific market place (Kasemsap, 2020). It is important
foe the J.D Sports to analyse competitors in India which deals in similar industry. Organisation
need to set clear and effective targets, concentrate on systematic growth and communicate all
strategies at all hierarchical level of business in order to gain competitive advantages.
Cultural sensitivity: Cultural sensitivity is defined as the cultural differences between people. It
becomes important for J.D Sports to analyse cultural factors and aspects of India than develop
business policies and strategies accordingly that help business to manage operations in effective
manner. Respective organisation need to bridge culture gap through maintaining effective

communication. Organisation need to observe customers as well as market trends in order to
influence customers towards organisational products and services.
Discuss and analyze the different barriers experienced by foreign businesses
in the selected country supported by different examples
There are various barriers are faced by organisation in the process of expanding business
in other country that impacts it overall performance and efficiency. It is important for the
business to analyse these barriers than develop effective strategies and planning for expanding
business in other country. All these barriers that are faced by J.D Sports during expanding
business in India country are explained below:
 Foreign laws and regulation: Every country has there own laws and regulation that
must be abide by the organisation which are operating in it (Khajeheian, Friedrichsen and
Mödinger, 2018). Tax implications through to trading laws, navigating legal requirement
is the central function of any successful international business. Employment and labour
requirement also different from one country to another. It is important for J.D Sports to
analyse all rules and regulations, political conditions of India to make batter decisions.
 Language barrier and cultural differences: In the process of performing operations in
developing country, it is important for the business to consider language barrier that is
spoken in specific country in which organisation want to expand. J.D Sports planning to
hire employees in India so it is essential to understand their language that make it simple
to communicate with them and convey all strategies, planning and other aspects properly.
Every country has their different culture,values and traditions that create barrier for
organisation (Khan and Ebner, 2019). It is important for the business managers to
understand India's culture than provide training to its employees so they can perform their
operations in best possible manner.
 Currency rates: Fluctuation in currency rates is considered as one of the most
challenging barrier that impact overall functioning of business at international level.
Regular assessment and monitor of exchange rate of India to develop effective strategies
and business policies. Higher fluctuation rate impacts J.D Sports expenses and profits.
 Political risk: Politically stability and uncertainty impact overall functioning of
international business. Emerging market provides various opportunities as well as
challenges for expanding global business. There are regular changes are happened in

political conditions, policies, rules and regulations that can impact J.D Sports investment
and business.
Provide appropriate strategies and other relevant recommendations to enable
the company to succeed in the selected developing country
As there are various challenges and barriers are faced by business that can impact its
overall performance and efficiency. It becomes important for the J.D Sports to develop effective
strategies and planning to run business operations in developing country like India. Some
recommendations for J.D Sports are explained below:
 It is recommended J.D Sports to conduct market research in India for the purpose of
analysing current trends of country, customers needs, demands and preferences as well as
political and economic conditions that can impact overall business performance and
efficiency (Kumar, Giridhar and Sadarangani, 2019). Organisation should develop
effective and suitable planning and strategy that help business run business operations in
India properly.
 It is suggested J.D Sports to provides training to its employees so they can perform their
operations and business related task in best possible manner. Training enhances skills and
capabilities of employees and motivate them to perform attain the objective of higher
work performance and efficiency that lead business towards growth and success.
Organisation also need to hire employees from India because they are familiar from
country culture and perform operations with effectiveness.
 J.D Sports need to analyse India's pricing strategy to they can set prices of products
accordingly and attract larger number of customers. Organisation need to maintain
effective relationship with suppliers so it can get quality material at affordable prices
(Kwok, Watabe and Koh, 2022). It reduces overall organisational cost and enhances
success of business in developing country.
 J.D Sports need to conduct advertisement through using different social media platforms
such as Instagram, Facebook and other that enhances organisation reach and spread
awareness of its products and services in target audience. J.D Sports should maintain
effective and strong relationship with customers through providing them quality
experience that retain them with organisation. Customer retention is the key of success in
international business.

CONCLUSION
From above explanation of report, it has been concluded that global business
environment provides an overall platform for the purpose of attracting more and more customers
and also ensures growth and development of both countries and businesses. This report has been
covered multiple theories of business environment like Pestle analysis for analysing external
business environment, Porter's five forces for analysing competition level within industry, etc.
Furthermore, opportunities and challenges have been evaluated together with business strategy,
corporate governance and cultural sensitivity. Barriers experienced by international organisations
have been analysed and appropriate strategies have also been discussed. Additionally,
recommendations have been given to company for attaining success in selected developing
country.

REFERENCES
Books and Journals
Aerni, P., 2018. Global business in local culture: The impact of embedded multinational
enterprises. Springer.
Ahmad, S., Omar, R. and Quoquab, F., 2020. Family firms’ sustainable longevity: The role of
family involvement in business and innovation capability. Journal of Family Business
Management.
Alshare, K. and Sewailem, M. F., 2018. A GAP ANALYSIS OF BUSINESS
STUDENTS'SKILLS IN THE 21st CENTURY: A CASE STUDY OF
QATAR. Academy of Educational Leadership Journal, 22(1), pp.1-22.
Amankwah-Amoah, J., Khan, Z. and Osabutey, E. L., 2021. COVID-19 and business renewal:
Lessons and insights from the global airline industry. International Business
Review, 30(3), p.101802.
Belyaeva, Z. and Lopatkova, Y., 2020. The Impact of Digitalization and Sustainable
Development Goals in SMEs’ Strategy: A Multi-Country European Study. In The
Changing Role of SMEs in Global Business (pp. 15-38). Palgrave Macmillan, Cham.
Bhasin, N. and Garg, S., 2020. Impact of institutional environment on inward FDI: A case of
select emerging market economies. Global Business Review, 21(5), pp.1279-1301.
Das, S. and Kundu, A., 2018. Individual and business environment: How effective interaction
affects sme development. International Journal of Engineering and Management
Research (IJEMR), 8(4), pp.101-113.
Gupta, M. and Minai, M. H., 2019. An empirical analysis of forecast performance of the GDP
growth in India. Global Business Review, 20(2), pp.368-386.
Hartono, A. and Kusumawardhani, R., 2019. Innovation barriers and their impact on innovation:
Evidence from Indonesian manufacturing firms. Global Business Review, 20(5),
pp.1196-1213.
Kasemsap, K., 2020. The role of strategic outsourcing in global business. In Foreign Direct
Investments: Concepts, Methodologies, Tools, and Applications (pp. 236-268). IGI
Global.
Khajeheian, D., Friedrichsen, M. and Mödinger, W., 2018. An introduction to competitiveness in
fast changing business environment. In Competitiveness in emerging markets (pp. 3-11).
Springer, Cham.
Khan, M. A. and Ebner, N. eds., 2019. The Palgrave handbook of cross-cultural business
negotiation. Springer International Publishing.
Kumar, S., Giridhar, V. and Sadarangani, P., 2019. A cross-national study of environmental
performance and culture: Implications of the findings and strategies. Global Business
Review, 20(4), pp.1051-1068.
Kwok, A. O., Watabe, M. and Koh, S. G., 2022. COVID-19 and the Evolving Business
Environment: From the Lens of Three Innovation Theories. In COVID-19 and the
Evolving Business Environment in Asia (pp. 281-289). Springer, Singapore.

TASK 2
Introduction
The global business environment is the business that has its business activities that are
being carried out according to the environment of various countries that it operates its functions.
The company selected for this business is JD sports that is a UK based company. JD sports is
retail company related to sports fashion (Nudurupati, Garengo and Bititci, 2021). It is
headquartered in Bury, England and was founded in 1981. Its main motive is to operate its
production operations to another country and the country selected for this report is India. India is
a developing country and will give unlimited benefits to JD sports. In this report there is
PESTLE analysis and SWOT analysis is discussed with its challenges and opportunities for JD
sports in India.
PESTLE analysis
PESTLE Analysis is a structural framework that examines various external factors
impacting the functions and overall business performance. It gives information about
opportunities and challenges that are faced during the operating of business other than
competitive forces (Rao, 2019). It directly impacts and influences the business entity. It is used
to evaluate external environmental factors and in context with JD sports is explained below:
Political factor- These factors include government policies, rules and regulations that influence
the arrangement or specific industry. It consists of political stability, trading and taxation policy.
In JD sports, this factor analyses long term profitability in market.
 Opportunity: In India, the political laws do not affect the operating of JD sports
operations as it is easy to operate the laws in Indian local market.
 Challenges: It would need a lot of research as they will affect sales and supply chain in
India. This factor prevents higher exchange rates, trade rules and restrictions on import
from the government side that can lead to business failure.
Economic factors- These factor influences on economy and business performance on it. It
includes various interest rates, rates of employment, foreign exchange rates (Reid and Lee,
2018). In JD sports case, it can use economic factors as they specify industrial economy in its
growth in the market and country. The company needs to evaluate Indian market conditions and
target for its products.

 Opportunity: If the growth rate in India is high it will result in increasing of supply
chain of sporty products in market.
 Challenges: Economic factors such as inflation, taxation in India can influence JD Sports
operations in adverse way.
Social Factors- These factors include social environment in market. JD sports should understand
its target audience and how they need to design a message for retail market.
 Opportunity: JD sports should cater various needs and wants of market by providing
new trends in market that rises its demand (Tuffour, Amoako and Amartey, 2020). The
sports apparel and others should be according to need of Indian market.
 Challenges: Due to the changing of new trends that makes the consumers unaware about
the new products and services it reduces the sales of the products, this type of market is
not good for the business.
Technological Factors- These factors include technological innovation and development. JD
sports needs to follow currently updated technology ahead of competitors.
 Opportunity: JD sports always keep on updating with new innovation for increasing the
sales. It also uses artificial intelligence to develop online platforms to sell its products
online media.
 Challenges: the social media and artificial intelligence can be hacked in Indian market
resulting in loss.
Legal Factors- These factors regulate legal aspects of the business operations in a country. JD
sports needs to consider legal points as they affect the business operations.
 Opportunity: JD sports trades internationally and this helps employees with rules and
regulations for sales in market.
 Challenges: It is difficult for JD sports to keep on changing with Indian laws as it will
influence its business operations (Usunier, 2018).
Environmental Factors- These factors are surrounding environment impacting business
operations. JD sports needs to understand Indian market along with its condition and laws.
 Opportunity: JD sports produce products that are environment friendly and involve the
ecological investment.
 Challenges: JD sports needs more resources for consumer demand as well as ecological
factor should be considered as it reduces supply of product.

SWOT analysis
Strengths Weaknesses
 Political stability
 Less Trade Restrictions
 Inflation
 Laws and legislations
Opportunities Threats
 Technological advancements
 Research and Development
 High competition
 Varied taste and preferences of
customers
Pestle analysis on the basis of SWOT analysis
Pestle analysis
factors
Opportunities Challenges
Political Indian government is stable and
this will result in more
employment and growth of
business (Vihari, 2019).
Indian government has laid certain
restrictions on exporting and
importing duties, that will result in
reduction of sales.
Economic Price changing of products
along with new demands will
result in quality improvement
and thereby increased sales.
Inflation and other fluctuations in
price will be a challenge.
Social Preferences of customers will
be there, so the company has to
produce its products
accordingly.
Declining of reputation and brand
value will be there because of the
controversies.
Technological Due to innovations of new
products and addition of new
features will help in expanding
organisation.
Delay in product launch because of
changing of old trends will need
more research.
Legal There will be new rules and Changing laws will decrease market

regulations for the employees
and sales.
share thereby creating specific
market in India (Yaklai,
Suwunnamek and Srinuan, 2018).
Environmental It will provide clean products
for customers to fit with their
values and beliefs.
It will have strong competition in
market with price and quality terms
that can resulting in changing minds
of customers.
Conclusion
From the above report it can be concluded that Pestle and SWOT analysis is important
for knowing all the different factors and aspects of JD sports for getting its business operations to
be settled in India. This report has been covered various aspects that are related with pestle and
SWOT analysis for JD sports for analysing internal and external business environment of the
organisation.

References
Books and Journals
Nudurupati, S. S., Garengo, P. and Bititci, U. S., 2021. Impact of the changing business
environment on performance measurement and management practices. International
Journal of Production Economics, 232, p.107942.
Rao, I., 2019. Competing values in Asian business: evidence from India and Dubai. Journal of
Asia Business Studies.
Reid, D. and Lee, K. H., 2018. Strategic planning practices in Hong Kong: a cultural dimension.
In Global Business (pp. 238-258). Routledge.
Tuffour, J. K., Amoako, A. A. and Amartey, E. O., 2020. Assessing the effect of financial
literacy among managers on the performance of small-scale enterprises. Global
Business Review, p.0972150919899753.
Usunier, J. C., 2018. Intercultural Business Negotiations: Deal-making Or Relationship
Building?. Routledge.
Vihari, N. S., 2019. Effects of business model innovation on corporate sustainability: intervening
role of organisational learning and strategic flexibility. International Journal of
Innovation and Learning, 26(2), pp.131-154.
Yaklai, P., Suwunnamek, O. and Srinuan, C., 2018. How Intellectual Capital, Knowledge
Management, and the Business Environment Affect Thailand's Food Industry
Innovation. Asia-Pacific Social Science Review, 18(2).