International Business Report: UK and China Risk Factors

This report investigates the risk factors influencing businesses in the UK and China, with a specific focus on the retail sector and the case of Walmart. It identifies political and geopolitical risks, market share challenges, and the impact of Brexit on trade relations. The report analyzes Walmart's strategies for managing these risks, including supply chain management and adapting to market changes. It also examines the position of the retail industry in the global market and the measures employed by companies like Walmart to control risk. The study evaluates the impact of various factors on the business environment, including legal regulations and government policies, to provide recommendations for improved risk management within organizations. The report highlights the importance of understanding and mitigating risks in the international business landscape to achieve sustainable growth and success.

International Business: Risk
factors that influencing China
and UK business

ABSTRACT
This report is all about identifying all the risks factors that are affecting the existing
business of UK and China on a global level. International business is the major aspect of the
current research report as it target major country's market such as United Kingdom and china.
Walmart has been chosen in the research study which has higher skills in terms of technology
that boosted its current market share and in turn increases its overall value in the external
environment. Walmart faces both political or geopolitical risks which is affecting its entire
performance. Market share of Walmart is higher than large number of stores of this entity
enhances its value in front of the external business environment. Legal regulations are followed
by this entity will be helpful for them in order to improve their existing performance.

Table of Contents
CHAPTER 1 INTRODUCTION ....................................................................................................1
Background.............................................................................................................................1
Aim.........................................................................................................................................2
Objectives...............................................................................................................................2
CHAPTER 2 LITERATURE REVIEW..........................................................................................3
Gap analysis............................................................................................................................7
CHAPTER 3 RESEARCH METHODOLOGY..............................................................................9
Research questions.................................................................................................................9
Data collection methods.........................................................................................................9
Data analysis.........................................................................................................................10
Evaluation.............................................................................................................................10
CHAPTER 4 DATA ANALYSIS ................................................................................................12
Discussion.............................................................................................................................12
CHAPTER 5 CONCLUSION AND RECOMMENDATION......................................................14
Conclusion............................................................................................................................14
Recommendation..................................................................................................................14
REFERENCES..............................................................................................................................15
........................................................................................................................................................18

Topic- To identify the political risk faced by UK and China businesses during trade
CHAPTER 1 INTRODUCTION
Background
Current research report is based on identifying all the risks factors that are affecting the
existing business of UK and China on a global level. The major aspects covered in the whole
report is international businesses as it target major country's market such as United Kingdom and
china which is higher in terms of technology that boosted its current market share and in turn
increases its overall value in the external environment (von der Heidt, 2015). Assessment of the
existing market is essential for the external users in order to invest in the current market as
investing in strong market will in turn increases its overall sales and the revenue. Image of the
business will be created easily by catering all the services to the consumes in order to capture
higher market share. Retail sector has chosen as common organisation that exists in both the
location as it is located on a global level which helps in ascertaining the actual condition of
international business.
The current condition of an entity will be easily determined by achieving desired aims
and targets within a given span of time. Risks is regarded as the common factor incurred in every
enterprise whose efficiency will be judged by an entity owner in their business which helps in
strengthening the current business. Firms operating in retail sector is required to change their
traditional practices according to the external market changes as in this way the worth of an
entity will get increases (Zhilong, Bowen & Yu 2015). Role of an entity is important for an
enterprise as this helps in generating higher sales and the revenue in short span of time as
compared to the existing market rivals. Risks are associated with an entity need to be recognised
by an employer by analysing their performance in relation to several parameters set by them in
order to grab higher market share. Risks will be minimised by an entity owner by emphasises on
the desired aims and targets which enhances the quality of services offered by them to all its
stakeholders.
Negative factors are taken as one of the important parameters in order to improve the
current business performance of an entity as their desired aim is to grab higher market share. The
current business condition of an entity will get improved with the passage of time when an
employer emphasises on the desired needs and expectations (Wood, 2015). Existing business
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condition are analysed properly in order to target higher market share as global entity who
surpasses its domestic boundary require unique skills in order to maintain its survival for long
time in the current business.
Aim
To Identify risks factors that influences UK and china businesses on global level in respect to
retail sector
Objectives
 To evaluate factors that might create risk for businesses like Walmart
 To analyse the position of retail industry across the globe.
 To determine measures that retail sector employs to control risk
 To recommend ways that can improve risk management aspects within organisation
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CHAPTER 2 LITERATURE REVIEW
Factors that might create risk for businesses like Walmart
According to Wu & et. al., (2015) which observes that being a large industry they are
required to manage all its operations in the best suitable manner. Satisfaction of customer's needs
and expectation will be helpful for an entity in order to create loyal customers. Risks will be
ascertained by an entity as this would affect the entire financial as well as non-financial
performance of an entity over a certain period. Risky factors are required by determined as the
retail sector is large industry in both UK and China businesses that may influence its existing
market share to be affected with the wrong usage of information on global level. Basic factor of
risks faced by an entity is higher level of competition faced by an individual operating their firm
by offering unique product or services in the external business environment.
Caraway (2016) has asserted that risks is always negative for an entity as it affected the
current status of an entity which gets disturbed due to the heavy imposition of external market
pressure. Political risks is one of the risk faced by retail sector as governments of a country will
intervene in the every business decision taken by an entity. The impact of the political risks
affected an entity for long term as every legal reform launched by an entity will restrict the
existing actions of the business concern. Political decision's and its stability needs to be analysed
by an entity in advance as this would affect its entire business performance.
Launching of any new products or services in the existing market require prior approval
of the government by taking legal licensing and permission in order to implement their decision
without any burden in the external market. An entity is required to analyse its actions in relation
to the external party's aims and targets which needs to be completed within a short span of time.
Political risks incurred in the external environment of UK and China are required to be
ascertained by Walmart as this would affect all it investment requirements of a business.
Investment in the Walmart gets reduces when heavy duties and legal reforms created by the legal
authorities of both the countries. Global enterprise are required to follow all the rules and
regulations that facilitate their firm in enhancing their existing business by targeting higher
audiences in the business environment.
Another risks faced by retail sector in relation to the geopolitical segments which
includes that Walmart faces challenges in terms of supply chain management. Export and import
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restrictions imposed on an entity also restricts their geographical boundaries in order to transfer
all its products or services from one place to another without affecting its current market share.
China – UK Trade: The Effects of Brexit, (2017) has asserted that Risks factors are
required to be assessed by the researcher by evaluating the existing conditions of both the
country's trade relations as they both covered in the European market. BREXIT impact can be
positive or negative for UK and china. Trade relations of UK and china is strong enough as they
trade most of the goods from one pace to another which requires legal permission of BRXT in
order to negotiate. There is positive partnership of UK with the European market as smooth trade
relations of the country is possible with the current partnership. On the other hand, china is
regarded as the biggest trade partners of UK. The Biggest issue faced by UK is to get imported
goods from china in UK as this is due to over dependence of UK for all the resources from China
in the china. This dependency depicts the new opportunity for trade among both the countries.
Political issue is the major trade issue faced by both UK and china as the political clashes
of their government deteriorates their current trade relations. Due to unstable political conditions
BREXIT intervenes in the trade among both the countries as china ranks among 7th Largest
export market of UK.
Market share risk is another factor that affects the existing business performance of both
UK and china as the import of china generates higher sales and he revenue over a certain time
period. Import and export process will be performed in both countries as china imports its goods
to UK and in return UK exports variety of goods to china. These process will generate higher
share for both the countries as both of them get higher market opportunities. The decision of UK
in order to quit the European Union which indirectly affects the market share of china as it
enjoys higher share in EU.
Position of retail sector in global market
According to Zander, McDougall-Covin & Rose, (2015) Walmart is facing competition
from local and multinational chains which includes Metro AG (MEO.DE) in Germany, Loblaw
Companies (L.TO) in Canada, Carrefour SA (CA.PA) in France, Ahold in the Netherlands and
Tesco (TSCO.L) in the United Kingdom. Also, international revenue of the company is growing
fast. Walmart is the biggest employer in the world after Chinese army and UK department of
defence. It has 11000 stores spread over 27 countries with 2.2 million employees. In past three
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years its sales grew by total of 8.6 percent. However, Walmart keep on focusing strategies like
everyday low prices and everyday low cost which helps in establishing price leadership in the
country, with this Walmart also launched click-and-collect in UK (Walmart in UK, 2017).
Likewise, the company manages e-commerce in 11 countries counting US.
According to Morschett, Schramm-Klein & Zentes, (2015) recently it has enhanced new
shopper endorsement engine to personalize products searches, also the company is engaged
upgrading digital and mobile connections. In last 1 year, Walmart multiplied the number of
products available by 2 times in china and 10 times in Brazil (Wal-Mart And China, 2015).
Unlike, the company also been suffering losses on web sites but in contrary Walmart is expecting
a turnaround in its online business by twenty eighteens.
As per the views of Stahl & Tung (2015) the company is trying out trials on online
grocery concept in some specific western markets of US. And this to directly give competition to
Amazon's Fresh that is Amazon Online Grocery. As stated in past studies online groceries was
not profitable so it will be fascinating to see Walmarts's strategies of Everyday lowering prices
and Everyday day lowering costs. The company's profitability index is going up right through
starting because Walmart service strategy is to respect individual, high standard of service and
constant strive for excellence. The market share of this company is that is it has captured 59.3%
of US market and its net sales of groceries are 56 percent, home 7 percent, apparel 7percent,
entertainment 10 percent, health and wellness percent.
Measures that retail sector employs to control risk
From the point of view of Nutter, (2015) that suggest that effectiveness of retail sector
will be easily judged when they emphasise on their current performance in relation to various
risks faced by them currently. Risks are essential to be recognised in the initial stage as further
this would affect their business in the relevant sector very badly that will be ascertained in
advance. At the same time, control and regulation will be applied by an individual in order to
enhance their current performance so that they can gain higher market share. Various measures
adopted by firms like Walmart as being a global leader their responsibility towards all its
stakeholders has increases with the increasing external market complexities. The current
efficiency will be tested on the current threat or weaknesses of this retail sector entity. Risk
identification measures are adopted by a firms operating in retail sector in which past, present
and future patterns of all the buying behaviour of the customers are judged deeply in order to
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generate its future actions (Pangallo & et. al., 2015). Statistical data about the retail sector are
properly assessed in relation to various factors to be considered by an enterprise owner than their
major emphasises lies on improving the existing performance of company. Risks identified by
the researcher in the current research are used against the competitors of the current form as their
main motive is to grab higher market advantage over all the current market rivalries. Walmart is
the biggest market player on a global level as they need to research the external market in which
it is trying to expand its market operations.
Slade & et.al., (2015) has asserted that Legal and Market Integration in which firms like
Walmart operating their firm on a global level as this is taken as the biggest local issue of any
country which can become a global problem. Investigating the legal environment of the countries
in which Walmart is trading made it easy to capture the web market so quickly.
According the study of Khatib, J. (Ed.). (2016) has observed that another measure to
control the current external market risks is integrating corporate missions with the current trade
practices of the firms like Walmart would be helpful in showcasing their transparency to buyers.
Zhang & et. al., (2015) has observed that Working Environment is also important aspects
that needs to be considered of retail sector keeps a regular check over internal factors of the
company to ensure stability in internal business environment like the company has set rules and
regulations for every employee working with the company, also managers has set a benchmark
to check over the actual performance and planned performance.
The company identifies and review over the risk factors, uncertainties in case of sudden
fluctuations in business environment. Firms operating in retail sector regularly keep analysing
strengths, weakness, opportunities, and threats that is SWOT and political, economic, social,
technological, legal and environmental factors that is PESTLE in order to prevent risk from
internal and external environment.
The company also avoid scarce and wastage of resources. Firms operating in retail sector
also schedule risk management workshops of 4 to 5 hours (Bai, Sarkis & Dou, 2015). The
workshop of the all companies are basically based on six risks that also acts like important pillars
that depicts the true performance of an entity in term of several streams. Different steams on
which Walmart focuses in order to generate higher sales and the revenue in less period are legal,
political, financial, strategic, operational and integrity.
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The company also built shareholder protection, in order to protect shareholders privacy
because that is confidential with company. Also, seek ways to move our of weak strategic areas.
The Walmart Company also appointed expert advisor, accountants, bankers, lawyers and
consultants to build protection against uncertain risk.
Summary of literature review
On analysis of literature review section it can be identified that there are number of
factors that create risk for retail sector. It can be observed that political conditions of the nations
have heavy impact on the profitability and competition of the firms in the retail sector. Apart
from this, legal system of the nations also affect the retail sector of the nation. At company level
it can be observed that retail chains are charging low price for their products and due to this
reason they are facing heavy loss in the business. It can be said that retail sector performance
across the nations is affected by varied factors.
Gap analysis
Gap analysis is that analysis in which previous study of author will be compared with
their current study in order to find out the gaps or differences. The differences are identified by
the researcher by analysing the past research studies in relation to their present research report in
order to consider the right facts and figures for the betterment of current research. Gaps are form
par of every research which are analysed in relation to the external market pressures imposed on
the researcher that restricts their capabilities in order to satisfy higher needs and expectations of
all the users of the market.
Current research report is based on identifying the position of two important country's
businesses which is dealing in a similar sector of the business in order to ascertain the true
business performance. The business performance is essential to be determined as this would help
an entity in generating higher sales and the revenue on a global level. Role and scope of an entity
gets increases with the passage of time as the focuses of an entity lies on achieving all its desired
aims by emphasises on the important aspects to research. Gaps found in research shows the focus
of the researcher which gets shifted while conducting research due to various reasons such as
lack of resources available while conducting research (Bai, Sarkis & Dou, 2015). Gaps are
negative aspects that influences an entity in order to rectify it on time in targeting higher
audiences to the research in generating higher sales and the revenue within a given span of time.
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International business is a common stream that needs to be linked with the current condition of
both UK and china businesses to analyse all their business actions.
Actions and decisions of an enterprise held responsible for improving the skills and the
capabilities which in turn helpful for an enterprise in order to gather higher share in the external
business environment. Theoretical principles are used as various authors uses several approaches
in order to explain the current issue in order to create better understanding among al the users in
the business environment. In the current research the focus of the researcher lies on identifying
all the risk factors which are currently affecting the financial performance of Walmart that is
locating in both UK and china businesses which in turn determines the international level
business status. The current capabilities and skills of these businesses are assessed in relation to
various parameters that improve the talent of the business concern that will be helpful in
generating higher returns over a certain period.
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CHAPTER 3 RESEARCH METHODOLOGY
Research questions
 Evaluate factors that might create risk for businesses like Walmart?
 What is the position of Walmart in global market?
 Determine measures that Walmart employs to control risk.
 Suggest some ways that can improve risk management aspects within organisation.
Research questions are framed by a researcher in order guide all their actions as their
main motive is to collect important facts and figures in concluding the research assumptions.
Hypothesis are build by a researcher that will be helpful for them in order to generate outcomes
in terms of data that are used in order to test all the hypothesis in a research study. Hypothesis
are tested while conducting research as in a research study all the assumptions are proved by an
individual by collecting relevant data on all the questions (Fletcher, 2017). Research questions
are act like a compass which provides right direction to an entity in gathering important data for
summarising all the data towards the common aim of the research.
Research questions are developed by a researcher is to be presented in a research
methodology that help an individual in order to gather important data related to the current
research. Data collected by an individual are tested in relation to various factors as this enhances
the overall quality of information included in a research report (Mansuri and et.al., 2017).
Research methodologies are used by a researcher in order to guide all their action to mould their
research in a right direction. Right direction is regarded as one of the important approach while
conducting a research
Data collection methods
Secondary data- It is gathering of data from that sources where the information is already being
collected. It can be journals. Internet, company records or corporate or governmental archives.
The data needs modification to fit into objectives because the information is not assembled
personally by researcher. Basically it is second hand or re-used data that is collected from
primary day (Le Roux, 2017). The data is collected for some other purpose but the research find
some information which is needed by him, so that data is collected. The sources are selected on
the basis of problem arises and then further discussion are made to re arrange the relevant data
and then decision are made by analysing them.
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