International Business and Globalisation

INTERNATIONAL BUSINESS
AND GLOBALISATION

TABLE OF CONTENTS
INTRODUCTION ..........................................................................................................................1
LO 1.................................................................................................................................................1
Importance and impact of global trade and globalization............................................................1
LO 4.................................................................................................................................................3
Awareness of contrasting international markets in context of the international business
decision making...........................................................................................................................3
LO 5.................................................................................................................................................5
Critical evaluation of the pattern of internationalisation ............................................................5
LO 6.................................................................................................................................................7
Determining the key findings, strategies, practical issues and solutions. ...................................7
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
International business is referred to as the trade of specific goods, services, capital,
technology and knowledge across the various national and international borders. Globalization is
referred to as the political program which tends to involve the cross border transaction (Karlsson,
Cornett and Wallin, 2018). It is useful in the elimination of the problems linked with the
international business. This study will analyse the impact and importance of globalization and
global trade. Furthermore, this report also compare and contrast the international markets in
context of the international business decision- making. This report also critically evaluate the
pattern of internationalisation which has been carried by international businesses. Lastly, this
study apply critical set of theories which is useful in formulating range of appropriate solutions
related with the problem. Sykes Holiday Cottages is one of the leading independent holiday
cottage rental agency in the UK with over 25 years of experience. They tend to offer 16000
holiday homes across Ireland and UK.
LO 1
Importance and impact of global trade and globalization.
International trade is considered to be useful in reducing the real wages and is one of the
key relevant factor to raise the living standards. It is useful in rise in the employment levels and
enable consumers to attain greater variety of goods. This is relevant in signifiant degree of
import and exports of the goods and services. This eventually leads to higher market share, sales
and profitability. International business and globalization results in cross border transaction
between 2 countries and more. International trade is considered to be useful in making abundant
use of the raw material and attain higher competitive advantage (The importance of international
trade, 2019). It is relevant in attaining the market share and eventually leads to the attainment of
the economies of scale. This also leads to global growth and development of the economies.
High degree of goods are made available for the purpose of consumption. It provides consumers
with the wide array of choices and helps in economic growth of the company. International trade
results in the reduction in the trade fluctuations. The impact of the international trade is
considered to be phenomenal. It is relevant in stimulating the economic growth. It is also
significant in increasing the efficiency and improving the technological progress. International
trade is considered to be highly beneficial for the consumers to have better access to the specific
goods and services (Karlsson, Cornett and Wallin, 2018). Trade of the goods and services
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internationally results in lowering the cost and is significant in the higher attainment of the goals
and objectives. It is significant in the better utilization of the resources and helps in increasing
the reputation and goodwill. International trade across varied set of countries helps the company
in reducing trade fluctuations. It also leads to greater employment opportunities and also leads to
high economies of growth (Iwu, Bayari and Jaiyeola, 2019). Free trade of business which leads
to high degree of demand and supply of the goods and services eventually leads to greater
operational performance and efficiency. Presence of effective government policies is also one of
the key prominent reason which improves the business relevance. Efficient promotion and higher
consumption of the goods eventually leads to better set of operational performance and improved
productivity.
Globalization is referred to as the growing degree of interdependence of the economies,
culture, and population. It leads to speedily movement and exchange of the goods and services. It
is considered as political program which involves the cross border transaction. It is useful in the
elimination of the problems linked with the international business. Globalization is linked with
the interconnectedness of the business and people across the globe. It eventually leads to the
cultural, global, economic and political integration (Verbeke, Coeurderoy and Matt, 2018). It
tends to have significant capability to communicate and move easily across various national and
international borders. Globalization is considered to be very useful in spreading of technology
and innovation. It has better access to the foreign culture and is useful in increasing
globalization. It is useful in maintaining high degree of standards and gaining access to the new
market. It is also highly significant in getting access to the new market and talent. It is useful in
finding specialized talent in order to perform desired set of task and attain greater set of
efficiency and productivity. The impact of globalization is considered to be phenomenal. It is
significant in creating greater set of opportunities for the firms in order to effectively tap into
newer set of markets across the globe. The business which in turn has access to the capital,
technology, resources, knowledge, etc. is useful in improving the results and attain greater set of
outcomes. One of the key significant impact associated with the globalization is useful in
increasing and also promoting interactions across the globe. Globalization is considered to
beautiful in the creation of greater set of opportunities and improve their international network
and relations to carry out trade. Moreover, internation al trade helps the business to produce
goods at much cheaper price.
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LO 4
Awareness of contrasting international markets in context of the international business decision
making.
PESTLE Analysis
Pestle analysis is the tool used by business for analysing the macro environmental factors
having influence over the business. Sykes Holiday Cottages is planning to expand its business in
Australia and Canada
Political Factor
The factor is used to assess the political environment of country. Australia's government
has strong control over the operations of companies. There is wide scope for the Sykes ltd for
expansion as government supports foreign investments. There is significant political influence on
the companies.
On the other, Canada is a powerful political company and member of United nations. The
political system of the country is stable and is seen as attractive centre for investment by many
investors (PESTLE analysis Australia, 2020) Political intervention is minimal in the affairs of
country that helps them to grow effectively.
Economic Factor
Australia is 13th largest company of world. The Australian economy is growing at
constant pace. There are increased opportunities for the business due to the political support to
foreign companies. There is wide scope for the Syskes holiday cottages in Australia. Purchasing
power of currency is also high.
Canada stands at 10th rank in terms of economy. It is having free trade agreements with
number of countries. It is developed mix economy that will enable the company to grow
successfully. Economic growth is 2% with world class infrastructure.
Social Factor
Population of Australia is small however it is rich in terms of education, wealth and
quality of life. Large number of students come from oversees for getting education. It is also a
major tourist place. Due to this Sykes Holiday could run effectively and ground its root.
On the other Canada is big country with diverse population. Country has shortage of the
skilled workers over number of sectors (PESTLE analysis Canada. 2020). Huge of number of
travellers visit Canada every year for vacation and holidays. People have high standard of living.
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Technological factor
Australia in terms of technology is most advanced country. Syskes Holiday uses
advanced software and technology that helps the customers in reaching the cottages easily. It
could be booked from anywhere.
Canada is also advanced in the terms of technology and people accept the high tech
services. Syskes provides advanced features in its cottages that easy access, easy website and
other cottage service that will attract customers.
Legal Factor
Australia have have competition laws, consumer laws and fair trading laws that keeps the
organisations to comply with these rules accordingly. Syskes Holiday will have to comply with
all the rules and regulations and have to be active regarding the change in laws.
Laws and regulations are well established and followed strictly. It requires the business to
abide by all the statutory requirements. However the laws do not change frequently like in
Australia.
Environmental Factor
Australia is rich in natural beauty and there are various laws for protecting the natural
habitat. Syskes holidays will have to comply with all the environmental laws before establishing
cottages.
It is a tourist country with scenic beauty. Sykes can have have successful expansion as
there are number of locations rich with natural beauty. However it has to ensure that environment
exploitation is prevented.
Porter's Five Forces
It is the tool used for competitive analysis of the company.
Supplier Power
It assesses the power of suppliers in driving prices of materials. Australia is big country
having scope for the different business. Syskes Holiday being service company is not much
influenced by suppliers.
Canada is tourist country with large number of visitors coming every year. There is
labour shortage in country due to which prices are highly influenced by labour.
Buyer Power
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Buyer power in Australia is high being developed country. However it is well established
company that charges premium prices for the quality services.
It could face influence in Canadian market as being tourist country with number of
options. It could influence the prices of Sykes Cottages.
Competitive Rivalry
Competition is strong in Australia and mainly in major cities like Sydney. Sykes Cottages
will be facing strong competition in Australia but quality services could will enable to establish
successfully.
Tourism is one of the major sector of earning. Syskes Cottage has to fight strong
competition in Canada as there are various established tourist companies trusted by people.
Threat of substitution
Threat of substitutes is not strong as the prices of Hospitality is quite high in Australia.
However Syskes Cottage being big company could provide cottage at affordable prices (Dadu,
R.H.R., and et.al., 2018 : 1492-1501).
In Canada substitutes in the hospitality industry are existing but marketing strategies will
enable to attract customers worldwide.
Threat of new entrants
Threat of new entrants is not high as it requires huge investments and due to various
governance regulations in Australia.
New entrance threat is higher in Canada as country is attracting various investors and
companies around the world for investments in hospitality industry.
LO 5
Critical evaluation of the pattern of internationalisation
Internalisation could be described as process of designing products and services to meet
needs users in many countries or to design them so that it could be modified easily.
Internationalisation can be referred as company planning to expand the business by capturing
greater market share out of the country domiciled by branching out in international markets.
Global trend towards the internationalisation have helped to push economy of world into
globalisation where they are becoming interconnected through cross border finance and
commerce.
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The company planning to expand the business has to comply with all the regulations
prevailing in the country of expansions. Sykes Holiday Cottages is planning to expand the
business in Australia and Canada (Iwu, Bayari and Jaiyeola, 2019). The countries are highly
suitable for expansion from the analysis carried out by the management. Company could expand
the business in Australia by joint venture or on it own as there are various venture capitalists that
attract foreign investments. Being established country it will be attract new investors in Australia
and Canada. Australia will be selected for the expansion purpose because it will help in higher
growth and efficiency.
Ansoff Matrix
 Market penetration
Sykes Holiday Cottages is planning to expand its business in Australia. This will be useful in
attracting the customers of the specific target group which leads to increased degree of sales and
productivity. Sykes Holiday Cottages offer wide range of significant services and attract
customers from Australia.
 Product development
Sykes Holiday Cottages offers room on rent with varied set of innovation services and provide
customers with the personalized set of services. This way it leads to greater efficiency and
productivity. In the time of COVID-19 pandemic all the necessary precautionary and safety
measures has been taken by the Sykes Holiday Cottages.
 Market development
This is significant in the promotion of the specific products and services by the Sykes Holiday
Cottages in Australia. The expansion of the business to the Palm beach in the New South Wales
is significant in attracting large number of customers.
 Diversification
This is one of the key prominent strategy associated with the Sykes Holiday Cottages to diversify
the products range and services in order to attract more customers (Witt, 2019: pp.1053-1077).
Offering wide set of amenities like gym, transportation services, spa treatment, luxury services.
Personalized services, etc. to remain highly competitive.
Porters generic strategies
 Cost leadership
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Sykes Holiday Cottages tends to focus on providing the discounts and other loyalty program
offers to the customers which helps in the attainment of competitive advantage and leadership at
the lowest possible price.
 Differentiation
Sykes Holiday Cottages offers wide set of amenities like gym, transportation services, spa
treatment, luxury services, personalized services, etc. which is useful in providing them all the
services at the lowest possible price.
 Cost focus
Sykes Holiday Cottages offers services within the niche market where they ensure that the prices
are competitive in order to attain higher profitability.
 Differentiation focus
Unique range of products has been offered to the customers by the Sykes Holiday Cottages. They
focus on creating a one of style experience by providing the customers with the personalized set
of services and relaxation activities.
Internationalisation drivers Market drivers: Sykes Holiday Cottages focuses on expanding the business to the
Australia because large number of tourists visit Australia and go on vacation. Hence,
there seems to be increased set of demand and leads to greater profitability. Cost drivers: Expanding business in Australia will help in attaining the economies of
scale and providing services at the lowest possible price. This is useful in attracting large
number of customers. Competitive drivers: There are large number of resorts and cottages in Australia which
eventually leads to higher competition (Meyer, 2017).
 Government drivers: The government has set effective policies which makes it easier for
the Sykes Holiday Cottages to carry out the business with ease in Australia. It is useful in
complying with the laws and regulations.
LO 6
Determining the key findings, strategies, practical issues and solutions.
Australia's government has strong control over the operations of companies. The
Australian economy is growing at constant pace. Population of Australia is small however it is
rich in terms of education, wealth and quality of life which is considered to be as the key social
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factors associates with the expansion of business to Australia. Syskes Holiday uses advanced
software and technology which helps in better online reservation and easy booking and access to
the information. Syskes Holiday will have to comply with all the rules and regulations of
Australia. Syskes holidays will have to comply with all the environmental laws and any activity
related with the pollution and exploitation has been avoided. Syskes Holiday being service
company is not much influenced by suppliers (Mukherjee, 2018: pp.623-634). It is a well-
established organization and charges premium prices for the range of quality services. There are
large number of competitors who in turn are present in the Australian market. Sykes Holiday
Cottages offers wide range of amenities like gym, transportation services, spa treatment, luxury
services. Personalized services, etc. which is useful in remaining highly competitive. Sykes
Holiday Cottages tends to focus on providing the discounts to attract large number of customers
and eventually leads to greater profitability. The government has set effective policies which
makes it easier for the Sykes Holiday Cottages to comply with the specific rules and regulations.
Strategies Expansion of the business: This is considered to be as one of the key significant measure
which is relevant in expanding the business to the newer market or country i.e., Australia
which is highly significant in attaining competitive advantage (Buckley, 2020: pp.1-13).
Expanding the business into new territories is relevant in effectively attracting large
number of customers and leads to greater operational performance and efficiency. Adding new services and products: This will be useful in adding services which meets
the requirements of the customers and also comply with the standards of the COVID-19.
Providing the customers with protective services and measures improves business
functions.
Practical issues Government issues: The restrictions imposed by the government of outside parties at the
time of the COVID-19 pandemic has severely affected the operations of the business at a
greater scale (Kobrin, 2020: pp.280-286).
 Currency issues:The COVID-19 pandemic has severely affected the business operations
and has also affected the economy of the Australia. This is one of the key prominent issue
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which has been face by the Sykes Holiday Cottages while expanding business to
Australia.
Solutions
Complying with all the standards and laws: In order to resolve the government issue the Sykes
Holiday Cottages must in turn significantly focus on complying with all the standards and laws
which has been complied by the government of Australia.
Financial stability: Ensuring that the company has enough cash to expand he business to the
Australia at the time of COVID-19 pandemic (Iwu, Bayari and Jaiyeola, 2019). This eventually
leads to greater operational performance and efficiency.
CONCLUSION
From the above conducted study it has been summarized that, international trade is
relevant in signifiant degree of import and exports of the goods and services. This also leads to
global growth and development of the economies. International trade is considered to be highly
beneficial for the consumers to have better access to the specific goods and services.
Globalization is useful in the elimination of the problems linked with the international business.
One of the key significant impact associated with the globalization is useful in increasing and
also promoting interactions across the globe. Syskes Holiday uses advanced software and
technology which helps in better online reservation and easy booking. Expansion of business and
adding new range of products and services is considered to be effective strategy for business
expansion. The key practical issues are related with the government issue and currency issue.
This can be resolved by complying with all the standards and laws and various financial stability
respectively.
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REFERENCES
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recently identified Lens orientalis resistance source ILWL180. Plant Pathology. 67(7).
pp.1492-1501.
Domingues, J. and Nunes, M.M.M., (2018). A first effort to understand the impact of Web
Summit in Lisbon 2016-2017 on the hospitality industry and Dand development of
startups(Doctoral dissertation).
Iwu, C.G., Bayari, L.S.O. and Jaiyeola, A., (2019). Exploring the [un] likelihood of successful
integration of skilled and unskilled immigrants into the hospitality industry.
Karlsson, C., Cornett, A.P. and Wallin, T. eds., (2018). Globalization, International Spillovers
and Sectoral Changes. Edward Elgar Publishing.
Kobrin, S.J., (2020). How globalization became a thing that goes bump in the night. Journal of
International Business Policy. 3(3). kob.
Meyer, K.E., (2017). International business in an era of anti-globalization. Multinational
Business Review.
Mukherjee, D., (2018). Corruption in International Business: Does Economic Globalization
Help?. Global Business Review.19(3). pp.623-634.
Verbeke, A., Coeurderoy, R. and Matt, T., (2018). The future of international business research
on corporate globalization that never was…
Waldburg-Zeil, T., (2020). How to enhance the use of Influencer Marketing for luxury hotels &
PR companies?.
Witt, M.A., (2019). De-globalization: Theories, predictions, and opportunities for international
business research. Journal of International Business Studies.50(7). pp.1053-1077.
Online
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throughhttps://www.economicshelp.org/blog/58802/trade/the-importance-of-international-
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PESTLE analysis Australia. 2020. [ONLINE]. Available through:
<https://howandwhat.net/pestel analysisaustralia/#:~:text=This%20PESTEL%20analysis
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