International Business Expansion: Meadow Foods in the Chinese Market

This report provides an overview of international business, focusing on Meadow Foods, a UK-based dairy company, and its potential expansion into the Chinese market. It discusses the rationale for internationalization, including increased profitability, better production quality, and innovation. The report recommends China as a target market due to its growing milk consumption, advanced technology, and affordable labor costs. It also addresses typical barriers to internationalization, such as market access, consumer preferences, bureaucracy, government challenges, competition, and currency exchange rates. The report concludes by highlighting strategies Meadow Foods can employ to overcome these challenges and succeed in the Chinese market. Desklib offers a variety of resources, including past papers and solved assignments, to aid students in their studies.

International
Business.

EXECUTIVE SUMMARY
In this following report, it described about international business which focused on how
national or domestic business turns into international level platform within certain process. The
findings which are regulates on the basis of boundaries that matters for cross broder exchange
with exchange of goods and service dealing in international market. Different range of sources of
funds has been discussed on the basis of planed of specific business into international. Some of
the strategies which individual business can undertake at the time of approaching international
business is Joint Venture, crowdfunding, Franching etc

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
1. Illustrate overview of chosen organisation and rational to going international business...1
2. Critically discuss which country would recommend them to enter and rationale behind the
decision...................................................................................................................................3
3. Discuss the typical barriers that organisation faces in internationally. .............................5
CONCLUSION................................................................................................................................8
References:.......................................................................................................................................8
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INTRODUCTION
International Business comprise about to trade of product and services, technology,
capital and knowledge with across the globe. It involves cross border transactions of goods and
services between two or more countries (Carracedo, Puertas and Marti, 2021). It encompasses
about all commercial activities that take to promote the transfer of goods and services, resources
for people within different innovation of technology enhance the business productivity around
the globe. While doing the business in the international market their are variety of thing and
there are various types of factor is going to influence the working of the organisation in
international market.
When the business vision to expand international platform they analyse towards analyse
all things that they will acquire to operation effectively.In this following report, the local
business is been selected Meadow Foods, which is UK based local owned dairy ingredients to
the food industry that belongs from Chester, Cheshire United Kingdom. They have around 50-
100 employees works around the world. In this following report, it is covering about planning of
local business in new international market. To discuss about barriers which company can faces at
the time of establishment business in new market effectively. To evaluate about the
implementation approach for internationalism process on specified target market by the
company.
MAIN BODY
1. Illustrate overview of chosen organisation and rational to going international business.
By performing international business it could help companies to increase their revenues,
decreased competition as well as having longer timespan in markets(De Marchi and et. al, 2020).
The Meadow foods is local based business firm in United Kingdom which manufactured milk
and other dairy products with associate to promote along with distribute in boundaries of UK. It
was founded in 1992, as now Meadow Food is largest individual owned dairy group with
supplier of milk food industry. It currently operates more than 400-500 million of litres of milk
each year which is direct over 550 farmer suppliers from across with North England West Wales.
As they are planning to expand their business into international market for more profitability.
There are objectives of Meadow Food company to expand the business into international level
are describe in following points are:
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 More profitability earning: Profit is the basic aspect for every business, without having
profit the business would not sustain for longer period of time in market. The assurance
of earning profit is measurable of company long term stability. Similarly, maximisation
of profit is one of the major factor of Meadow Food company at the time to establish
business within international market. In order to accomplish this primary objectives,
certain other motives are also essential to be pursued by business.
 Better production and Supply Quality Good and Services: Since the business utilises
the various resources for society, as it specifically expect higher quality of produce and
services. From that individual company, focuses towards produce quality of product and
services within the right time of business. For Meadow Food company, their
manufacturing team is also determine that their manufacturing of dairy product and
services enhance better quality which increase customer satisfaction as well as
profitability. Through this, customer would expect product of Meadow Food company
must deliver on timely basis. It is important for every business to supply those goods and
services on regular basis.
 Regular innovation: Innovation is major part for business because it raises opportunity
for better transformation in products where the procedure of production and distribution
of goods. Business through innovation is able to reduce cost by implements new
resources for better productive manner which increase their sales.
 More Opportunities of investments: There is an advantages of expanding business from
national to international, specific business would attain more investment opportunities
through which company can expand and attain higher profitability. This would be one of
the opportunity where Meadow Food company can easily target large organisation by
pitching the objectives of business.
 Development of Human resource management: As Employees are the main key assets
for company in which employees always wants to grow as per their competency. The
growth of workforce relies on training and development where individual improvise their
skills and knowledge.
Evaluation:
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From above objectives of international business are more productive enough at the time
of Meadow Food company establish their firm international platform. Above objectives are
essential to consider for company during business established in China country.
2. Critically discuss which country would recommend them to enter and rationale behind the
decision.
As Meadow Food company is well known as local business in United Kingdom and they
are planning to establish their venture international market in China. To recommend China
country as international market for Meadow Food company to target their Dairy Food product
and services for expand purpose. The reason to consider China as a target international market
for provide UHT milk, as China did not have production of UHT dairy milk product and
services. Further, benefit which Meadow Food company would get from China milk market as it
consists of fresh liquid with Ultra High Temperature processing is known as healthy milk
(Fainshmidt, Aguilera and Verbeke, 2020). Even though, China technologies are very advanced
and their labour cost are consist very cheaper than other international market. This would easy
for Meadow Food company to manufacture UHT milk.
Illustration 1.: Size of China Milk Market gradually expand.
Source: https://daxueconsulting.com/report-on-dairy-milk-market-in-china/
Evaluation
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It is interpreted from illustration 1 graph is describing about China Milk market is
smoothly expanding. In this Chinese consumers are shifting on nutrition milk or dairy products.
It is assumed that the expected sales of china in milk business would increase from approx. 11.95
billion at the year of 2018. to 12.83 billion in year of 2022. Thus, this assumption depicts the
market size of milk in China is flexibility leading towards growth.
Illustration 2.: Sales Volume of milk market in China, 2020.
Source: https://daxueconsulting.com/report-on-dairy-milk-market-in-china/
Evaluation:
On the above graph is described of high consumption of Milk in china has full-fledged
since 2012. It is happen due to influence of traditional dietary habits and limits of economic
better development in 2012. In this each person are consumed through only about 3.69 kilogram
of milk as per year approximately (China brands of dairy milk consumption, 2020). Furthermore,
the more consumption of powdered milk of China ranks at the top among all countries in the
world. In the year of 2020, the consumption of milk of china has increased its benchmark. The
consumption of milk per capita is projected to reach up to 28 Kg in 2020 and 41 Kg predicated in
2030.
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Advantages of business in China for other local business like Meadow Food company are:
 China as a Major world trade hub: As per according, with its sheer size of land and
population is very wide of China towards international trade. In this, many large China
based companies better understand about importance of accommodating towards the
global market. The government of China regulates the polices and regulation are properly
stable and towards foreign companies. It is safe to say China has become a vital factor of
international trade and should get significantly valued in every global business.
 The landscape of China is itself an innovative: The business environment of China is
improved through the presence of advanced technologies. In this, Scientist and
technological innovation has been played an important for promote the economic
development. Apart from it, the labour cost of China is quite affordable and people are
highly skilled and innovative in nature. For Meadow Food company, would easy to
driven their business for more than any place else.
 China is having low cost country: On the basis of minimum wage and working standard
has been increased on the yearly basis. As China is undoubtedly is an manufacturing
power house which gained the title of being world's factory.
 Work Ethic work as a symbol: On the basis of Chinese culture, they mainly focus on
high value work diligence. This directly impacts on employee on their job performance.
For Meadow Food company there is one benefit to pursuing business in China that is they
have innovative and skilled peoples who seeking for contribute their competence in
business platform (Garri, 2021) . As per the China work ethics regulation it comprises
strict work rules as it ensure about well organised and good environment. Through this,
employees can contribute their skills and knowledge as well as gain learning aspect that
improve individual productivity skills effectively.
Justification:
On the basis of above advantages of pursuing business in China is very productive in
terms of work ethics, advanced technologies, innovative and skilled manpower along with low
labour cost etc. These are the factor which better determine to increase Meadow Food company
milk business volume in competitive market. To recommend Meadow Food Company can use
work ethics as well as advanced technology of China, these two aspects can help for Meadow
company to attain better competitive advantages.
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3. Discuss the typical barriers that organisation faces in internationally.
At the time of expanding local business into international market, there are certain
challenges which company must determined for long run in international market. In perspective
of Meadow Food company, they plan to establish their milk and dairy product business venture
in the international market in China. The China is rise as an consumer economy has been long
suspected. But due to recent figure have confirmed that enhance more confirmed export oriented
powerhouse is now how much more intentionally determined to better creating opportunities for
companies seeking for better business expansion. There are some important challenges which
Meadow Food company would faces:
 Market Access: On the basis of China local distribution is having buying habits that
enhance local consumer that raise more requirement in China. This could be very
difficult to market access. The market environment of China is with other competitors.
For example: Meadow Food Company is generally Milk and dairy product manufacture.
They can face issues to compete with other companies like Yili Industrial Group Co. Ltd.
 Consumer preference: There has been a sizeable class shift in China over certain past
few decades and consumer environment is better diverse (Kurt and Kurt, 2020). The
population of China is around 1,369 million with different people have their taste and
preferences. But Meadow Food Company can face issues to target customer for their
Dairy and milk product.
 Bureaucracy: In China, there are certain firm struggle with laws and regulation which
driven by Chinese government. With this, 31% of around of 338 respondent in every
individual business event that emphasis about the more licence permit to analyse the
respondent analysation.
 Government challenges: The transparency of government procedure and corruptions are
main aspect for company where they shift to China. As the citizen of China need to
understand the government decision towards serve their interest and growing of risk.
 Competition: There are many Chinese companies are seeking for better quality of
product and services so they can sell them in abroad. This practice increases the
competition on the basis of result.
 Currency Exchange and inflation rate: The exchange rate is worth of one nation's
currency in relation within others. The currency rate between the two countries does not
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remain constant or it fluctuates during certain period of time. The implementation of
exchange rates, when it makes any sort of financial decision as it may decrease the final
product which might affect by business profit. The inflation rates can vary across
countries and can increase impact towards product.
 Foreign politics and policies: The policies and politics of a specific country plays an
important role towards company. If there would new political governance, then it will
concerned towards taxes, labour laws that have direct impact on cost of company
(Marchenko, Babyr and Gerrits., 2020). Thus, it is important for individual company to
closely where it follows the politics and policies of country is operating.
Evaluation:
It is been discussed from above challenges that can face by Meadow Food company at
the time of establishing new business in China. There are certain challenges Market assess,
foreign exchange policy, taxes and other aspects could raise barriers for Meadow Food
Company.
4. On the basis of analysis, critically evaluate a relevant implementation approach for
internationalition process for specific target.
As per above analysis, it is evaluated that Meadow Food company can formulate strategy
of Financing and Joint venture of China. This two implementation approach can lead to
company for better growth in China Market. With this, two approach Meadow company can
understand Work ethics of China and advanced technologies can better lead towards the
competitive market for China. There are advantages and disadvantages of Financing and Joint
Venture.
Financing: It is process of providing funds of specific business activities that making
purchases or investing. The utilising of financing plays an vital role to purchase product out
better immediate reach.
Advantages Disadvantage
 Financing can help to business for
closing with more sales which driven
by customers . It creates flexibility to
make regular loan payments the work
 It might require assets on loan
collateral, as well as loan covenants.
There are some of control over
operations and first call on generate
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