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International Business Assignment PDF

Added on - 20 Nov 2021

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Running Head:INTERNATIONAL BUSINESS1
International Business
INTERNATIONAL BUSINESS2
Table of Contents
Introduction.................................................................................................................................................3
Company Description..................................................................................................................................3
Analysis of Political, Economic, Cultural, Legal and Ethical Risks in the Country Selected...........................4
Political Risks...........................................................................................................................................4
Cultural Risks...........................................................................................................................................4
Legal Risks................................................................................................................................................5
Ethical Issues...........................................................................................................................................5
Identification and Evaluation of Business Opportunities.............................................................................6
Key Economic Indicators..........................................................................................................................6
Levels of Competition (Domestic or International)..................................................................................6
Evaluation of Income Levels (In Terms of ‘Poor’/Middle Class/Rich Elites), Demographics, Education
Systems...................................................................................................................................................7
Consumer Buying Habits..........................................................................................................................7
Appropriate Examples of Companies..........................................................................................................8
Conclusion, Recommendations and Proposed Market Entry......................................................................8
References.................................................................................................................................................10
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Introduction
In today’s competitive business environment, business expansion is one of the most significant
strategies which can assist the organizations to enhance its brand presence and overall
profitability (Doz, 2017). Considering the significance of this strategy, British supermarket chain
Morrisons is planning to invest overseas. The company is considering it very important
component in the process of attaining its long term strategic goals. Morrison is 4thlargest chain
of supermarkets in United Kingdom that is headquartered in Bradford, West Yorkshire, England.
Currently, it is running two formats i.e. Superstores and convenience stores. For this company,
the chosen market is Australian market where company can plan to expand its business
operations. This report is focused on analyzing different risks and opportunities which Australian
market can offer to the business of Morrison. Australian market can offer various opportunities
in the future which can assist the organization to gain more popularity all over the world.For
assessing the attractiveness of market, examples of other companies are discussed. At the end,
the report provides the recommendations to the chosen organization regarding Australia’s
attractiveness and market entry modes.
Company Description
In United Kingdom, retain sector is one of the fastest growing sectors. It stands on 3rdposition in
world economy. In the beginning, this industry is used to restrain the small scale stores. Now,
these retailers are very much focused on offering excellent customer services and expand
business at large scale (Tidy, Wang & Hall, 2016). In United Kingdom, there are various
supermarkets like Tesco, ASDA, Morrison and Sainsbury. Morrison Supermarkets is one of the
largest supermarket chains in United Kingdom and it has its headquarters in West Yorkshire,
England. Established in the year 1899 by William Morrison, the company started as egg and
butter stall in Rawson Market, Bradford. Till 2004, its store locations were focused in North
England but with the acquisition of Safeway, its presence enhanced in South England, Scotland
and Wales. Now, Morrison has 498 superstores all over England, Scotland and Wales. In August
2017, its market share was 10.14% that was 0.86% down from the year 2015 (Kollewe, 2015). It
INTERNATIONAL BUSINESS4
led this retailer behind Tesco, ASDA and Sainsbury. Morrison Supermarket is listed on London
Stock Exchange and now it is the part of FTSE 100 index of firms.
Now, the company is purposing to expand its business operations in Australian market in order
to attain its long term objectives (Swoboda, Elsner & Morschett, 2014). The below-paragraphs
analyze both risks and opportunities which this market can offer to Morrison Supermarkets:
Analysis of Political, Economic, Cultural, Legal and Ethical Risks in the
Country Selected
As mentioned above, Australia is chosen as potential market for business expansion of Morrison
Supermarkets. So, Country risk analysis of Australia is discussed below:
Political Risks
In Australia, Political environment may offer different risks to the business operations of
Morrison. Political scenario in this country is unstable and there are recurrent changes in the
regulations and standards of government. It is very important for any retailer like Morrison to
consider these changes and comply with the standards accordingly. It is a parliamentary
democracy and constitutional monarchy. In this country, the economic policies are made by the
government. Australian government has made different policy decisions so that they can control
the growth in expenditure (Findlay & Garnaut, 2017). It may have negative effect on the growth
of Morrison in this market. However, policies of government do not have major interfere with
the foreign investment. As per the root model, this organization may face the control and
instability political risks in this nation. Social system of the country is regulated by the
government that increases the interference of government in different sectors which will have
direct impact on the autonomy of Morrison. Moreover, the company requires developing good
relationships with different political groups and government.
Cultural Risks
There are various cultural and ethical risks which may affect the business of this UK retailer in
Australia. Morrison may confront these risks as there are differences between culture of UK and
Australia. The culture of UK is very formal and it is Christian based but Australian culture is not
so formal rather it is authoritative. It can affect the people’s choices towards retail and grocery
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