International Business: Business Drivers, Cultural Factors, Trade Barriers, Ethical and Social Issues

This document discusses the business drivers, cultural factors, trade barriers, and ethical and social issues in international business, specifically in the context of expanding a business in China. It covers topics such as PESTLE analysis, target city selection, cultural factors, and trade barriers. The document provides insights and recommendations for businesses looking to enter the Chinese market.

International Business

Table of Contents
INTRODUCTION...........................................................................................................................1
Business Drivers.....................................................................................................................1
Identify the target city or province in China..........................................................................3
Cultural factors.......................................................................................................................3
Trade Barriers.........................................................................................................................5
Ethical and social issues.........................................................................................................5
Method of expansion..............................................................................................................7
CONCLUSION................................................................................................................................8
REFERENCES..............................................................................................................................10

INTRODUCTION
UTH milk technique of enhancing the quality of dairy product by by eliminating the bacteria
and microorganism from them. It is the common technique which is used in the dairy and food
industry in which the the milk is being heated on the high temperature in order to alleviate the
pasteurization level from the milk in order to enhance the quality (Sullivan, 2018). UTH milk
which has created a huge business opportunity in the Chinese market. They are having a wider
market available in which the organisation can invest in the field of dairy in order to expand their
business across the borders. Ethical dairy is the chosen organisation for this report, it also explain
the necessary procedures and elements that is used in the concentration of country in order to
compete with their competitors and come out as a leading business unit in the Chinese market.
This report will cover the the analysis of of business drivers and cultural and social issues
associated with the different market segment.
Business Drivers
According to the research, It is said that business drivers is defined as a feature in an
organisation that contribute in the instrument of productivity and the financial outcome for the
business. These are the innovative inputs that help in achieving the excellence performance
within the business industry (Rexhepi and et. al.,2017). In order to assess and identify the
business drivers which help the ethical dairy to operate their UTH business in China, PESTLE
Analysis is being considered as it is the management tune which is used by the various business
in order to determine the external factor in the business environment that is impacting the day-to-
day functioning as well as the profitability of the business. There are various factors which are
included in this analysis in order to find the the effect of external element on the business
operation. These factors are explained as follows:
 Political factor: These are the factors which includes the political stability, government
policy and their rules & regulation. It is very important for every organisation to
understand the effect of political factors on their business so that they can run their
business in smooth and flexible manner within the country (Yin, 2019). (Pathak, 2018).
China is the progressive country which is proactive and assertive in nature so this helps
the Ethical Dairy to study the procedures and policies by the government of China in
order to align the business operation in appropriate manner.
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 Economical factor: These are the factors which includes the inflation, gross domestic
rate, taxation rate, deflation rate and interest rate. The ethical dairy have to assess this
factors so that taken easily comply with the economic environment in the country. China
is facility and the systematic arrangement of their financial resources and an estimate the
budget of the startup project in the respective country.
 Social factor: these are the factors which reflect the socio- culture of the country and
China is very modern and productive country and the majority of the individual is
inclining towards the innovation and advancement in their product and services
(Mukherjee, Makarius and Stevens, 2018). This is the main reason why the countries
considered as a advancement centre in the world. Hence the ethical dairy is needed to
assess this factors of the society so that they can offer the product and services according
to the market need.
 Technological factor: It is analysed form the research that these are the factor which
includes that Innovation and the advancement in the technology. China is well known for
its technological development as the countries having various invention that help them to
enhance their technological standards within the society. This give various opportunities
and in order to run the operation in China, it is very important for Ethical dairy to
enhance their technology to meet the standard of technology used by the UTH business
in the China.
 Legal factor: These are the factors which includes legal formalities and the various laws
associated in the China. This is the most complex task that needs to be considered by the
ethical dairy so that they can run their business in China. As the legal environment is very
complex and tough to set up a business within the country (Li, Zhou and Wu, 2017). It is
required for the company to comply with the legal formalities and take all the required
permission from the court as well as other essential documents like working permission
card, tax regulation document and licensing.
 Environmental factor: These are the factor which leads to exercise by the ethical dairy
company in order to operate their business by complying with the sustainable natural
environment in the China. As per the evaluation of the researcher, company must focuses
on offering and environmental friendly packages so that it became a leading company in
offering substernal solution towards the naturals surrounding in the China.
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From the above discussion, it is derived that there are two important drivers that can
enhance the business of ethical dairy in China can be termed as the cost-efficient milk product
and the advancement in the technology.
Identify the target city or province in China
According to the research It is said that when the business wants to operate international
market, it is is necessary to analyse and identify the cities that are having more business
opportunity so that the business can be operate easily. In context to the promotion of the product,
it is very important to select the target market so that the company can get their potential
customers, who are ready to invest in the product and services which are offered by the company
(Kim, Chiou and Calantone, 2018). Shanghai is the target market for the ethical dairy, as it is the
the major city of China who is having ample of opportunities for the new business ventures in
order to establish their business and retain higher profitability from them. Ethical dairy will
locate there financial resources the daily market of Shanghai so that they can offer the quality
service by offering the UTH milk to their potential customers. The population of Shanghai is
divided and segmented according to the various variables and the most effective variables that
are selected by the firm in order to target their potential customers in terms of sales and
marketing. It is evaluated from the observation of the researcher that Shanghai will help in
providing a necessary start to the new business venture of the ethical dairy by which they can
establish a strong brand image in the prospective market of China.
Cultural factors
These are the factor which examine the values, shared beliefs and background of the
individual that is having a huge impact on the buying behaviour of the customer. In order to
understand the cultural factors that is affecting the substance ability and profitability of the
operation which is been delivered by the ethical dairy in the China. Hofsteda model will take into
consideration that allowed the business form to differentiate among the various element that
gives the comparison and two countries in order to understand the difference within the country.
 The first factor of culture is termed as the individualism. It can be said that Western
countries have more level of individualism then the Asian countries. In United Kingdom,
high standard of independence is being promoted within the society as it is the advanced
country where every individual is entitled to live their life according to their own interest
without interference of other member in the society (Jiménez-Asenjo and Filipescu, D.A.,
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2019). On other hand, China has the traditional approach and individual are likely to
follow more collectivism, where every member in the society is delegated to each other
so in order to establish their business by ethical dairy, they must adopt the collectivistic
nature. As the increasing demand as the increasing demand in the society leads to leads to
considered the collectivism by the respective company in an appropriate manner so that
they can easily communicate their overall vision to the society. With the effective
inspiration of collectivism, the individual and the society of China, tends to focus more
upon the personal equations and relationships so that they can achieve the group goal of
an organisation. Where is in the United Kingdom, individual self focused and work with
the consideration of attaining their personal goal and building relationship with other is a
secondary aspects for them.
 The second factor is power distance the element that explain about the degree of power or
the authority of the individual in the respective region. The power distance of the China is
relatively high compared to United Kingdom is the people of China tends to be more
tolerable in the ongoing power conflicts. In United Kingdom, the people try to implement
more stable and democratic behaviour in the organisation and it can be said that the
ethical dairy needs to be more fascinating its function in the Chinese market as the
individual will be quite affected by the hierarchical structure that is being used by the
firm.
 It is the factor which includes the uncertainty avoidance index and in relation to China
they are much higher in terms of handling uncertainty then United Kingdom. As the
people who are living in the UK promote more risk and are more tolerant to hot the
uncertainty in the business environment. On the same and they are more flexible to adopt
the change within the organisation (Hartsfield, Johansen and Knight, 2017). Hence it is
suggested to the ethical dairy toward the systematic Strategies and action plan so that
they can conduct their operation in an effective manner so they have to ensure that their
business does not get affected by the uncertain business environment that is prevailing in
the the country.
It is analysed from the discussion that, business environment to China is very progressive
being traditional. As the main consideration of every organisation in the China is building a
successful relationship in order to achieve higher success. The traditional approach is being
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practiced by the ethical theory to incorporate and align the culture of the country so that they can
enhance their engagement and involvement of the society in their product and services.
Trade Barriers
As per the observation of the research, It is is the factor whitch is determined by analysing
the amount or duties imposed upon the import and export of goods and services. It is the
implications issued by the government and must taken into consideration by every organisation
in order to operate their business in the international market. There are various kind of trade
barriers that is imposed on the business of ration of ethical dairy in the China market, some of
them are explained as below:
 The primary barrier which is being faced by the ethical dairy while operating their
business in the international market is termed as tariff. Is considered as the tax that is
being imposed by the the government body of the nation on the export and import of
goods and services. The organisation needs to meet the obligation of the various tarrifs
duties on the regular basis so that they can comply with the legal formalities of the China.
 There there are various reserved quota for the import of goods within the country and the
ethical dairy is required to invest in this quota so that they can meet the the certain kind
of leverage in operating their business in the international market across China.
 In order to operate food and dairy productin the China, it is important for the business
enterprises to have the food licence which give the allowance to operate their business in
the Chinese market in an lawful manner.
 There are various documents which are required to formulate their business in the
international market. This practice ensure that the company's operating their business in
full legal assistance and does not experience have any intervention that would leaves to
restrict the functionality of the business in the international market.
Ethical and social issues
These are the implication and the obstacles that are penetrate the standards of ethics and
authenticity reveling in the organisation while working in another country. This gives the assured
to the society e that they are complying with the ethical and social responsibilities in the market
(Giuliani, E., 2019). As per the viewpoint of the researcher, there are some major ethical and
social issues that must be sold by the ethical dairy in order to run their business in an
international market are explained as follows:
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 When the organisation wants to overcome from the social barrier, it is very important to
provide good working environment to their employees that can help in enhancing their
productivity and they will give their best in their given job role in the managerial function
of the organisation.
 Working standards adopted by the business is the primary social issue that is required to
promoted by all the business organisation. They ensure that hign moral must be there
more than the employees get motivated in order to achieve their desire goal. This helps in
getting the authentic and credible work within the organisation.
 The management of the ethical dairy must ensure to eliminate and ignore the negative
politics that is been ongoing in the organisation so that they can establish a positive
environment to the workforce which leads to give them a comfortable working space to
the employees.
 It is important for their respective organisation to comply with the tradition history and
culture of the employees which is bing formulating and the organisation so that they can
produce the barrier of cultural attributes in order to establish uniformity in the operations.
It also promotes that, no individual is discriminated on the basis of colour, caste, religion,
gender or other social background.
 The company must ensure that, they are not hiring a children who are under age for
employment so that they can restrict the child labour within the organisation. This up left
the standards of children in the society and move towards the development for the same.
 Ethical dairy must promoting diversity in the workplace by recruiting the candidate from
the different region across the globe. Workplace diversity is defined as a concept in
which individual are working from the different backgrounds and culture in order to
attain the common objective of the organisation (Chiarvesio and Romanello, 2018). This
help in upgrading the society and make the the optimum use of of potential candidate
within the organisation that will help the ethical dairy to achieve their desired goal and
create a productive and progressive working culture in the business enterprises.
 Ethical dairy mast comply with the human right and exercise within the business
functioning so that they can establish standards of humanity among the individuals that
are working in the organisation. As per my viewpoint, this helps in creating positive
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atmosphere where the human dignity is practiced and trust as well as the humanity is
appreciated so that this can helps in making the best use of employees.
Corporate social responsibility is the obligation that is being imposed on the business in
order to provided services to the society by enhancing their moral responsibility towards the
same. Ethical dairy can comply with the social issues by doing effective corporate social
responsibility in the China and work towards creating a effective solution in eliminating the
concerned issues from the society. This practice is the the inventive of time and efforts that is
incorporated with the corporate social responsibility and father help in creating from brand
image in the the target market so that it can enhance the realisation of perk associated with them.
Method of expansion
It is the method which is defined as a form of strategy by the way in order to expand
their cooperation in a team more profitability margin through the enhancement of their market in
the global platform. According to the view point of the researcher, Every organisation operate
their business in order to expand their market by which we can attain the higher profitability and
growth so that they can establish a strong brand image across the globe. In order to expand the
business in the international market specially in China, there are some expansion strategy upon
which the ethical dairy must focuses that are explained as follows:
 When the organisation wants to expand their market, it is very important for the business
to adopt and apply the appropriate project strategy to the current line of operations. The
product and services being offered by the ethical dairy must be superior in quality so that
large group of customers can be attracted and offer premium price policy as customer
ready to pay more prices for the quality product.
 Main company must focuses on adopting a effective budget strategy so that they can
ensure the availability of their financial resources in order to meet the future demand of
business operation in the international market. It helps in meeting the effect formation of
infrastructure and business campaign so that they can attract a large group of customer
towards their product and services. This strategy also help the ethical diary to get the the
effective return on investment by which they can adopt the innovative technology
through the ability of purchasing adequate resources in the organisation.
 The company must consider the sort of innovation in their product as the UTH milk is
already available in the Chinese market so the ethical dairy have to differentiate their
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product in order to gain the competitive advantage in the market industry (Andreini and
Bettinelli, 2017).
 The company must offices on doing partnership with the other small medium enterprises
so that they can enhance the scope of sale in the given market sector. The company can
comply with the well-known business which help them to carried out their business in its
market domain. This is strategy will not only benefit the but also so help in attracting a
large group of customers and in answering of their interest towards their company in
order to increase the sale in the Chinese market.
 In order to establish long term business in the China. Ethical dairy must focuses to watts
saving and investing in the various other ventures so that they can get the good returns
from them. These returns further utilised by the form at the time of emergency, which in
its financial capability as well as allow for the expansion of their business in the large
market.
 The ethical dairy also use the advanced promotional techniques and tools for advertising
their business in the Chinese market so that they can attract a large group of audience in
order to increase their sale. They can hire advertisement agency that help in providing a
effective marketing solution in order to reach maximum customer so that they can invest
more in the UTH milk offered by the respective organisation.
 When the organisation is using advanced promotional tools, the helps in attracting the
large group of audience by which they can establish of various franchises of their brand
in the different cities of China (Achim, 2017). As per the evaluation of the researcher,
this helps in increasing the profitability and growth of the company by serving the large
group of customers.
It is analysed from the above discussion that expansion strategy of the ethical dairy helps
them to operate their business in the different market segments. It is suggested to the company
that they are likely to get a slow start in the beginning as there are large number of competitors in
the market. But with the effective implementation of innovation and advancement in the
marketing of UTH milk, ethical dairy can achieve higher profitability and growth in their
respective business industry. The company just need to align and focuses on procuring the
financial resources so that they can expand their market in the different region of China.
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CONCLUSION
It is concluded from the above report that the companies having huge opportunities in
the Chinese market so that they can easily establish their business. The expansion of the small
scale business can help the other from two focus to what implementing the effective expansion
strategies in their business so that they can expand their business in the largest market. The
company must focuses on aligning their product with the cultural and the social values of China
so that take and sustain in the market for a long period of time. The company needs to work
according to the business environment of China so that they can survive in the Chinese market.
The company have to be proactive with their expansion Strategies and policies in order to get the
efficiency and effectiveness in their business operations. The feasibility of the expansion plan is
high as this expansion can leads to have the successful outcome for the business.
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