International Business and Globalization of Stay City Apart Hotel

This report discusses the importance and impact of global trade and globalization for Stay City Apartment Hotel. It also evaluates the pattern of internationalization undertaken by the hotel and suggests strategies for its expansion.

International business and
globalization of stay city apart
hotel

Table of Contents
International business and globalization of stay city apart hotel.....................................................1
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
LO1 Appraisal of Importance and Impact of Global trade and Globalisation............................3
LO4 Contrasting International Market in context of International Businesses Decision Making
.....................................................................................................................................................5
LO5 Evaluation of the pattern of Internationalization undertaken by International Business....8
LO6 Application of Appropriate knowledge, theories and tools to help formulate alternative
solutions to problems planning for International.......................................................................11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Globalisation refers to expansion of the products, technology, information, and business
functions across national boundaries. There are various reason because of which globalisation is
important for business organisations like increased opportunities and profitability. This report
will discuss importance of globalisation and global trade for the business organisation. Business
organisation which will be discussed in this report is Stay City apartment hotel. This Irish Bsed
company was founded in 2004 by Tom Walsh in Dublin and provides accommodation service in
the form of apartment and the company operates in around 6 countries in Europe and serves 12
locations and presently one of the leading aparthotel companies in Europe. This report will
discuss globalisation and factors related to globalisation. This includes importance of
globalisation and comparison of global markets for globalisation of Stay City Apartment Hotel
and will includes discuss over strategies that hotel can apply in its globalisation.
MAIN BODY
LO1 Appraisal of Importance and Impact of Global trade and Globalisation
Globalisation is an act of expansion of business and its activities across national
boundaries and this act is complex and critical in many terms. But there are various important
reasons which are associated with global trade and globalisation (Amano, Coverdale and Peh,
2016). Importance of global trade and globalisation which encouraged Stay City Apartment
Hotel to globalise its business are as follows-
Specialization of Business
Globalise requires that business are specialized and are able to produce and sell
something which is high in quality and at the same time is unique from others. This requires that
business research about scope of improvement and this helps in increased output and better
quality of operations.
Increased options for skilled employees

Globalisation and global trade increase the option for employees who can be employed in
the organisation. this enables Hotel to employ competent and skilled employees as the options
available for candidates to employ in the Hotel are comparatively higher (Chen, 2017). This
further contributes in effective operations of the company which gives it benefit at local level as
well.
Increased opportunities
Global trade and globalisation increase the opportunities which are available to the
organisation. This means that the products which company are not able to sell their products or
the products of the company which have been failed in local market can be sold in global market.
This also gives opportunity to Hotel that it can compete with new business in the industry.
Opportunities are in terms of other ways for business for example production business can look
for opportunities and invest in countries where their cost gets reduced. But for hotel its cost and
profitability are associated as the place where cost incur and the place where it generates profit
are same and this is why opportunities for Hotel is the country where it can earn projected profit
from its activities.
Increased Productivity and Reduced Cost
Productivity of the Hotel gets increased as the buyer in global market are more than local
market and increased productivity of the hotel means that the cost will reduce as a result.
Globalisation also contributes in specialization of the operations which also allow for ways in
which company can reduce its cost.
Increased Available Options
This is the importance of global and globalisation to the consumers because as business
globalise consumers are able to get more options for the products and service (Shahbaz and et.al.,
2018). This give them choice to get product and service which are better in quality or less in
price and is accurately suitable for their needs and desire. For example, Stay City Hotel which
provides hospitality and accommodation service to its consumers and its services are available in
apartment and its globalisation will give choice to the consumers that they can stay in apartment
hotel.

Impact of the Globalisation is also an important aspect with global trade and globalisation
of the business to discuss in its context. Impact of globalisation and global trade for the business
is as follows-
Globalisation make it easier to access international customers, this has been possible because of
globalisation that business now a days can access to international customers and offer them
products and services of their business. For Example, it is possible for Stay City Hotel to address
international customers and communicate its message to use its services through globalisation.
Increased and strong competition is another impact of globalisation and This impact have made it
possible that local business can compete with international business (Stram, 2016). This resulted
that it has become very difficult for small scale and new business to survive in the market. This
has also encouraged unethical activities which are undertaken by business to get ahead of the
competitors and earlier that to survive in the market.
Strengthen Economic condition of the Countries with the globalisation of business. This impact
of globalisation is positive as business invest their capital another countries and country’s
economy gets strengthen. Another aspect of this is that countries having useful resources and
opportunities get benefit of this impact. For example, Stay City Hotel will invest only at the
countries which have opportunities that its business will grow and get projected profit.
LO4 Contrasting International Market in context of International Businesses Decision Making
Stay City Apartment Hotel which is planning to internationalize its business STAYCITY
APARTHOTEL hotel can select Greece and Spain. Presently international expansion of the hotel
is limited and its expansion in these countries will introduce more opportunity to the hotel.
Before selection of any one country from these two it is important that factors related to both
these countries are analysed for accurate decision making. These factors are PESTLE factors.
Political
From analysis it has been found that Greece’s political landscapes can be described as unstable
(Perera, 2017). In all areas of politics in Greece multiple administration changes have happened.
This is not ideal situation of politics of a country.

Spain and its politics is comparatively stable because of its membership in EU and corruption in
the country is in ripe.
From the above analysis it can be said that politics of Spain is stable and this is why this can be
option because different ruling parties come with their own ideas and this affect business and
operations in the country.
Economical
Economic condition of Greece is not favourable and its government is facing deficits and
unemployment rate in the country is also high. But one of its strength is its tourism industry and
this is the favourable factor for STAYCITY APARTHOTEL. Tourism industry of Greece creates
opportunity for STAYCITY APARTHOTEL.
Spain at the same has faced economic recession but has started to improve. Economy of Spain
have high unemployment rate and its loan conditions are also unfavourable (Vallati and Grassi,
2019). This is not good for operations of the Hotel. Analysis also says that for starting a new
business Spain is not an ideal choice.
Social
Culture and heritage of the Greece are rich and hotel can use this for its business in Greece.
Some of the special things about Greece are its food, legendary history. This becomes one of the
positive factor for STAYCITY APARTHOTEL. Culture of Spain is also unique and there are
many things which attract visitors and tourist. Country also have place for immigrants and Spain
also celebrates Three Kings which also attract tourists.
On the basis of culture both the countries are appropriate for the selection for hotel business but
Greece is better option.
Technological
Greece is a well-developed country and its infrastructure is also well developed and its power
networks and mediums of connectivity are well developed. This makes it a good choice for
business because tourist of the country can rely on its digital connectivity. Technological

development of Spain is somewhat like Greece and this does not provide scope off
differentiation.
Legal
Legal environment of Spain is other European countries. Country has strict laws for copyright
and protection of data (Lewis, 2017). Spain is a Bureaucratic country and while starting a new
business there are hoops which it can jump.
Environmental
Though this factor does not affect much the type of business which is being discussed but still
while starting a new business STAYCITY APARTHOTEL have to follow environmental
regulations of the country. Greece has concerns regarding pollution, ozone layer damage and
disposal of hazardous waste (Perera, 2017). On the other hand Spain also has alike
Environmental condition and this does not provide scope for differentiation on the basis of this
factor.
On the basis of above analysis it can be concluded that for STAYCITY APARTHOTEL
Greece is a better option because its culture is more favourable for a business like Hotel and at
the same time its economic condition is comparatively is better than Spain.
Porter’s Five Forces
This model provides analysis about competitive forces for the business. These forces are
Industry Rivalry
This is the rivalry that exists in the firms of an industry. Increasing competition and
various facilities which are being provided by hospitality industry suggests that rivalry among
firms in hospitality industry of Greece is higher as being an attraction of tourist firms are more in
quantity and fairly compete on the basis of product and price (Vallati and Grassi, 2019). This in
Spain is comparatively weak but is individually it is also high.
Potential Threat for new entry

This is the threat for the new entry and this threat in both the markets is at moderate level
for STAYCITY APARTHOTEL cause this is the international firms and this requires investment
and resources to start business at such level.
Threat for Substitute products
This threat for the company is high in both the countries as STAYCITY APARTHOTEL
is apartment hotel and there are various substitute hotel and accommodation are available.
Power of Suppliers
Power of Suppliers is low as there are various suppliers available and this makes that
condition of the STAYCITY APARTHOTEL is strong in this competitive force (Irawanto,
2017).
Power of Buyers
Increasing competition and higher number of buyer are the reason that in this force of
competition position of STAYCITY APARTHOTEL is weak and customers are strong and their
power of high than the seller.
LO5 Evaluation of the pattern of Internationalization undertaken by International Business
This is the most important earlier discussion resulted in decision about what country
should STAYCITY APARTHOTEL select for the expansion of its apartment hotel services. The
above discussion suggested that Greece is the country where STAYCITY APARTHOTEL
should expand its business. This part involves strategies which STAYCITY APARTHOTEL
should adopt while expansion of its business (Lewis, 2017). For this model of Porters’ Generic
Strategies can be adopted.
This model provides four type of strategies which are based on cost and differentiation. The
strategies are
Cost Leadership
In this strategy company keeps its price lowest from its competitors in the industry.
Broad market is targeted in this strategy and lowest price is offered to the customers for the

service. This is not suitable for expansion in Greece because economy is Greece is developed
and in such a country offering low cost product would not attract customers.
Differentiation
This strategy involves that product of the company is highly differentiated from its
competitors and their product (Huang, 2019). The STAYCITY APARTHOTEL offers
accommodation and hospitality service in apartments and this is the main element which
differentiate it from others and on the basis of this company can charge higher price.
Cost Focus
This means that company firstly make trials on its strategy and target a small market for
its strategy and in this its cost leadership is applied for a small market. STAYCITY
APARTHOTEL can adopt this strategy and can reduce its cost and price of the particular type of
service and limit this to a particular small market in the Greece.
Differentiation Focus
This strategy refers to differentiation strategy which is applied at a small market and
success leads to further actions of the company. In case of STAYCITY APARTHOTEL they
need not to use this strategy because their product is different and there is less of this type of
services. In such case applying the strategy to broad market will be right (slami, Mustafa and
Latkovikj, 2020). Though STAYCITY APARTHOTEL can apply this strategy with an
additional element which to completely differentiate and this will also give idea about its further
success.
From the above analysis it can be said that STAYCITY APARTHOTEL can apply
Differentiation strategy at broad level and it can apply both cost focus and leadership focus with
its different type of services to get idea about their success in broad market.
Another which can be applied in this context is Ansoff Matrix, this model provides strategies for
business expansion on the basis of product and market. Strategies in this mode are as follows-
Market Penetration

This is the strategy which is adopted when market and product both already exist. This
requires business to make extra efforts for marketing and promotion so that it can increase its sell
in existing market (Omsa, Abdullah and Jamali, 2017). The customers can be increased be means
of attracting them by strategies like decreasing price, acquiring competitors, presenting existing
product in new form. Such strategies can be utilized by the company and this will enable it to
attract more customers. This is not a suitable strategy for STAYCITY APARTHOTEL as the
company is willing to expand its services on global market. Though, company can employ some
of the strategies to strengthen its existence in local market which will support its global
expansion.
Product Development
This strategy is linked with development of new product and the market where the
product is supposed to be sold remains the existing market. This strategy is adopted when
business has completed its product cycle and development of new product can help business to
survive and grow business. This is also done to cater existing market with different needs so that
company can increase its customers from its existing market. In this strategy research and
development plays an important role. As STAYCITY APARTHOTEL is willing to expand its
services in international market so it should not invest in development of new product for
existing market.
Market Development
This strategy includes development of new market and in this strategy business involves
development of new market where it caters needs of people with its existing products. This
involves expansion to geographical area, customer segments and regions. STAYCITY
APARTHOTEL is also going to expand its business and the expansion is in form of geographical
expansion in Greece (Dawes, 2018). Some of the important elements required for success in this
strategy is proprietary technology of the firm which can be leveraged into new markets.
Consumers and new market is potentially profitable and consumer behaviour in new market is
not highly deviated from the consumers in existing market. This can be done in some of ways
which are catering to new customer segment and STAYCITY APARTHOTEL will adopt
expansion to foreign market which means to cater to new customers at different nation.

Diversification
This strategy involves that market and products both are new and company develop new
product to cater needs of new customers which might be in other geographical area or new
customer segment (Schawel and Billing, 2018). STAYCITY APARTHOTEL should not use this
strategy as this is new and possess high risk.
LO6 Application of Appropriate knowledge, theories and tools to help formulate alternative
solutions to problems planning for International
Expansion of business in international market is a critical and complex and this is why
there are various problems which STAYCITY APARTHOTEL might face during their
expansion to Greece market (Kathuria, Mittal and Chhabra, 2017). Some of the practical
problems in this are-
Language and Cultural Barrier
This is one practical and common problem which STAYCITY APARTHOTEL might
face during its expansion to Greece. The solution for this problem is that company establish
strategies for adaptation of the market and establish go-to market strategies for Greece market.
Another solution for this problem is that company can train and prepare its employees who will
look after the expansion at Greece market with language and at the same time for its cultural
adaptation. Cultural adaptation also can be facilitated if company employs local people of Greece
for its operations in that market.
Local Competition
This is another significant problem which is practically faced by organisations during its
international expansion (Kogut, de Mello and da Rocha, 2019). STAYCITY APARTHOTEL
will also have to face this problem which is known as local competition in which its competition
will be with local business of the Greece which provide similar or substitute services. This
requires that STAYCITY APARTHOTEL identify for its local competitors and develop
strategies to deal with this. Other than this STAYCITY APARTHOTEL can also develop local
partnerships in Greece which help it o strengthen its position in Greece.

Tax Codes and Compliance Issues
This is also a difficult problem and STAYCITY APARTHOTEL might face difficulty in
dealing compliance at Greece for Tax codes and compliance for business practices. This can be
solved with proper and adequate knowledge of tax, compliance and finance regulations. This can
also be solved with assistance from local partners regarding regulations and compliance with the
local rules and laws.
Hiring Staff
Difference in culture might make it difficult for STAYCITY APARTHOTEL to hire right
and competent staff at Greece (Stram, 2016). This can be solved by advance planning for
development of great teams at Greece.
CONCLUSION
From the above discussion about globalisation and global trade it can be concluded
globalisation has various benefits for both the businesses which are being globalised and for the
countries where business operates and invest. Along with this it also is beneficial for the
customers and consumers of the countries where business operate in terms of globalisation. Later
this report included analysis of markets with the PESTLE model and Competition analysis in
both the countries and this suggest that it is very important for business to analyse these factors.
So that company can make right decision regarding its expansion. This also included strategies
which STAYCITY APARTHOTEL can employ for expansion of the business in foreign country.
The strategies were based on the models of Porters Generic strategies which include strategies
which are based on cost and product. This report also included some of the difficulties and
problems which can be faced by STAYCITY APARTHOTEL and what can be their possible
solutions.

REFERENCES
Books and Journals
Amano, T., Coverdale, R. and Peh, K.S.H., 2016. The importance of globalisation in driving the
introduction and establishment of alien species in Europe. Eicography. 39(11). pp.1118-
1128.
Chen, L., 2017. Globalisation and trade liberalisation in supporting GVCs upgrade. Journal of
Korea Trade.
Dawes, J., 2018. The Ansoff Matrix: A Legendary Tool, But with Two Logical Problems. But
with Two Logical Problems (February 27, 2018).
Huang, Y., 2019, December. Strategic Environment Analysis of Logistics Enterprise based on
SWOT-PEST-Michael Porter's Five Forces Model--Taking SF Express as an Example.
In 2nd International Symposium on Social Science and Management Innovation (SSMI
2019). Atlantis Press.
Irawanto, D.W., 2017, May. Indonesia Human Resource Management Practices: Cultural
Dimension and PESTLE Analysis. In Conference Proceedings International
Conference on Social Science and Management ICSSAM (pp. 574-590).
Islami, X., Mustafa, N. and Latkovikj, M.T., 2020. Linking Porter’s generic strategies to firm
performance. Future Business Journal. 6(1). p.3.
Kathuria, N., Mittal, K. and Chhabra, A., 2017. A comprehensive survey on query expansion
techniques, their issues and challenges. International Journal of Computer
Applications. 168(12). pp.17-20.
Kogut, C.S., de Mello, R.D.C. and da Rocha, A., 2019. International expansion for knowledge
acquisition or knowledge acquisition for international expansion?. Multinational
Business Review.
Lewis, R., 2017. Porter's Five Forces of competitive advantage.
Omsa, S., Abdullah, I.H. and Jamali, H., 2017. Five Competitive Forces Model and the
Implementation of Porter’s Generic Strategies to Gain Firm Performances.
Perera, R., 2017. The PESTLE analysis. Nerdynaut.
Schawel, C. and Billing, F., 2018. Ansoff-Matrix. In Top 100 Management Tools (pp. 31-33).
Springer Gabler, Wiesbaden.
Shahbaz, M and et.al., 2018. Globalisation, economic growth and energy consumption in the
BRICS region: the importance of asymmetries. The Journal of International Trade &
Economic Development. 27(8). pp.985-1009.

Stram, B.N., 2016. Key challenges to expanding renewable energy. Energy Policy, 96, pp.728-
734.
Vallati, M. and Grassi, A., 2019, July. AI to Facilitate Legal Analysis in the PESTLE Context.
In The EMerging Technology conference (EMiT) 2019 (pp. 66-68). IET.