International Business: Expanding into a New Market

International Business

Table of Contents
Executive summary.....................................................................................................................................3
INTRODUCTION.......................................................................................................................................3
Business drivers behind company’s expansion into a given country.......................................................3
Trade barriers..........................................................................................................................................6
Ethical and social issues to be considered by the business.......................................................................7
Cultural preferences to be considered by the businesses..........................................................................9
Expansion methods to be chosen by company.......................................................................................10
CONCLUSION.........................................................................................................................................12
RECOMMENDATION.............................................................................................................................12
REFERENCES..........................................................................................................................................14

Executive summary
International business defines the buying and selling of goods and services, technology,
knowledge, language, value, customers etc. across the national borders. This helps in showing the how
the international business is useful to promoting the offering of the business on a global level and earns
a high amount of profits. This includes the various terms that help in showing the entry of new market
methods so that domestic company can place their existence on the foreign countries. It also helps in
enhancing the GDP of the country. this report has taken the Rachel’s organic that is one of the SME in
the UK and expand their business unit in the china that helps in earning the high profits and also faces
some problems at the time of expanding the business like language, customer perception etc. and to
deal with this company can focus on the various aspects that helps in enhancing the business units and
enjoys the high revenues with sustainability.
INTRODUCTION
International business refers to a process of trading of products, technology, services,
capital and knowledge across all over the world and outside the national boundaries. It
encompasses all the commercial activities that can be taken place to promote the transfer of
goods and services. This report is based on UHT milk in UK and china market. In UK it includes
Dairy UK, Lyburn farm makes, Nestle etc. In China DANONE Group, Parmalat, Arla foods etc.
The economy of china is based on centrally planned system and it is more market oriented
economy and it shows the second world largest in the nominal GDP. Its GDP growth is 6.6%.
This report is based on the contemporary issue that is involved in the international business. It
can also involve the global context that can be used in international business in the twenty-first
century. This project also involves the methods of entry into a foreign market. It may include
alternative theories of internationalization. Further it helps in giving the knowledge related to the
impact of multinationals on both home and host nations and evaluate data on a country markets.
It helps in enhancing the business units in all over the world and increases the market growth of
the company internationally(HOTEL, 2016).
Business drivers behind company’s expansion into a given country
Two significant business drivers for internationalization for UK- SME

Production of goods and services has been increased in the global world and due to which
many firms takes advantage of it by expanding their business in all over the world. There are
various drivers that is face by the companies when they internationalize their business. in this
small and medium companies face more drivers in internationalization. It can be discussed
below(Kolk, 2016).
 Competition - It is the main driver that is face by the firm at the time of
internationalization of business is competition. In this an action, behavior of a competitor,
their strategies and corporate capabilities, and how they create interdependence in the
geographical market. By evaluating all the facts and figures a firm can enter into the new
market. For example- Rachel’s organic is an SME in UK want to expand their business in
China. At this time they need to identify their competitors to enter into the China market
after that they operate their business. it helps in earning profits and market growth of the
company.
 Expansion of technology – It is a principle driver in the international market. Advanced
technology and the skilled labor force is the pulling factor of the business when they
operate their business in some other countries. Because of using advanced technology
company can connect with large people who attracts towards their products, who invest
money in the firm for exploring in the world. For UK SME firm it is very important
aspect to increase their business and expand in the China because China is the best
technology driver country in the world. For example- when Rachel’s organic, UK wants
to expand and operate their dairy business than they need to use advanced technology in
tier organization so that they will stay in the market for the longer term(Strange and
Zucchella, 2017).
Porter’s five forces factors with relevant trade theories
Porter’s five forces factors help in identify and examine the competitive forces that help
in shaping the industry weaknesses and strength. It includes five factors i.e. purchasing power of
buyers, purchasing power of suppliers, threat of a substitute and threat of a new entrant and
rivalry of a firm. All these factors helps in identify the situation of an industry in which a
company enter. It also includes the trade theories with porter’s five force factor in the below
explanation.