International Business Strategy Proposal for ABC Continental Limited

This report provides a detailed strategy proposal for ABC Continental Limited's expansion into the UK market, including key business drivers, trade barriers, ethical and legal issues, and cross-cultural considerations.

INTERNATIONAL
BUSINESS

Table of Contents
INTRODUCTION...............................................................................................................3
1. A detailed strategy proposal based on extensive and relevant market research......3
2. Research must identify...............................................................................................4
a) Key business drivers behind company’s expansion into the UK...............................4
b) Important barriers to trade and protectionist policies that can hamper the new
venture............................................................................................................................5
c) Ethical, social and legal issues that needs to be taken into account ........................7
d) Cross-cultural issues that is relevant to the proposed venture..................................8
3. Evaluate the feasibility of the proposed venture in the current UK market
environment ...................................................................................................................9
a) E-commerce option versus other methods of expansion..........................................9
b) Aspects of international marketing relevant to the proposed venture.....................10
c) Potential impact of Brexit on the venture.................................................................11
CONCLUSION.................................................................................................................11
REFERENCES ...............................................................................................................12

INTRODUCTION
International business defines as all the commercial transactions which arise between two
or more regions, nations and countries beyond the political boundaries. The globalization has
positively impact on business operations and its functions in the large market place and it is
possible for the business organization which operates or regulate in various types of market
where opportunities are easily grabbed by performing better (Perlmutter, 2017). The term
international business is totally connected with all the business activities and functions that are
taken into consideration cross border transaction of services, products and resources between two
or more countries. The report is based on ABC Continental Limited who tries to set up business
in United kingdom for selling a product which is organic cotton infant wear. The main motive of
this assignment is to develop strategy which is proposed after analysing whole market area and
also identify business drivers of company expansions in the UK. Along with this, evaluate ethical
social, cultural issues which create issue within an organization effectively.
1. A detailed strategy proposal based on extensive and relevant market research
ABC continental limited is the small business which is situated in India and they try to set
up their business in UK. The company use strategy to establish a new e-commerce venture to sell
infant cotton wear in the United Kingdom market area. There are various strategies which can be
used by ABC continental limited for expand their business in United Kingdom market place.
These strategies are mentioned as follows:
Expand product line - It is one of the simple way which help in expanding business is to
enhancing the product offerings (Doz, 2017). The regular customers might be looking for new
products and services and will spend money in dollars. ABC continental limited expand their
business but they maintain their product line by providing new goods and services to their
regular customers who live beyond the boundaries.
Diversification - It another strategy which assist in expanding business in different area
and also target various segmented customers. It can help in enhancing sales if they have mature
business with some opportunities for required growth in current market area. Along with this, it
will help in reducing dependency on one or few products to maintain the desired customers.

Increased channel distribution - It is required for firm is to sell their product by using
different methods and in various regions is another way to expand the business organization.
There are some common options which include retailers, wholesalers, online marketing and so
more which help in attracting large number of customers.
In these strategies, ABC continental limited can select any of the strategy which helps
them in establishing their business at international market place without facing any issue. These
strategies assist in gaining attention of more customers whether they are domestic and
international (Penrose, 2017). They are developing new and unique products which assist them
in attracting more customers towards organization goods and services.
2. Research must identify
a) Key business drivers behind company’s expansion into the UK
It is required for ABC continental limited is to identify major business key drivers which
help them in expanding business in international market like UK. These are described as under:
Strategy - The first most key business driver for company expansion is strategy. Evert
fast growing business starts with an idea that turns into the perfect business plan that assist in
getting high income and profitability in minimum time period. the strategy might revolve around
to carry out new products to market and it is based on an existing goods and services applied or
delivered with the help of using new method for gaining attention of large number of customers.
Along with this, accelerated growth can be driven by developing large number of new products
and services for expand in new market place (Wiedersheim-Paul and Johanson, 2017). ABC
Continental limited also develops appropriate strategy which helps them in easily enter in the
United Kingdom where they can earn income.
People and operations - After the strategy, people and operations represents as the
another key expansion growth drivers. Organizations which have fast growing often they have
individual driving towards getting vision, mission and set goals in better manner. If company
need to expand their business in new market place they are required to maintain their employees
as well as business operations effectively. A growing business fast relies on teamwork. ABC
Continental limited need to draw them as a team of individuals who can be trusted, who share
all the goals and apply same values when they trying to carry that target in attaining potential
goals.

Funding - It can be analysed that no business can smoothly run without the accurate
funding and so capital is another key driver for company's expansion in UK market place. Along
with this, high growth can only reached with large amount of capital and high funding level will
automatically enhancing with fast growth (Brannen, Piekkari and Tietze, 2017). In this,
transaction is also essential for driving business expansion. This mainly includes alliances in the
form of strong supplier relationship in better manner. In addition to this, as the business expand
with the help of merger and acquisition that may offer desired in order to reach with changes in
growth and services provided to enter into new geographical market area. ABC Continental
limited required to collect and gather huge amount of funds before expanding its business in UK
where they set up all their activities but all such facilities are not work without having sufficient
amount of income. In order to gain high growth, they require investing appropriate funds for
smoothly running their business in new market place.
Risk and reporting - it is another key driver which help in expanding business in another
location. For business growth, company required to establish business in controlling and
managing the uncertain risk which occurs within an organization while expansion of business.
Along with this, reporting element is also essential for growing companies, both factors are
internally and externally affected the business. In this, management team need to communicate
clearly between them so this is understand by business to perform and deliver accurate services
to the customers (Bartlett, 2017). The firm require to report effectively to external investors and
other stakeholders in order to maintain their ongoing confidence and support. ABC continental
limited required analysing all risk factors which occurs while business development and
expansion so they need to develop suitable strategy that help in eliminating all such factors.
b) Important barriers to trade and protectionist policies that can hamper the new venture
Trade barriers are restrictions on international trade imposed by country government.
They are developed to impose the extra cost and value on imports and experts in order to protect
the local businesses. The additional costs and enhancing scarcity results in high price of import
goods that will help in making local products and services in more competitive. In addition to
this, protectionist policies are protecting domestic industries against international competition
which includes tariffs, non tariffs and quotas and other restrictions that are placed on the imports
of foreign rivals. There are some types of trade barriers which are described as under:

Tariffs - These are taxes which are imposed by government on imported products and
services. Sometime it is called as duties. Tariffs can be executed to enhancing the cost of goods
to customers in order develop them as expensive as and more costly than local goods. In some
cases, tariffs are used for protecting the local industries which cannot compete with international
producers (Vagts and et. al., 2015). Along with this, country is mainly affected by such tariffs
while they are lead towards getting higher growth. ABC continental also face such type of trade
barriers while expanding their business in United Kingdom for set up new business such as
selling organic clothes wear for infants in this market place. In the context of protectionist
policies, if nation is trying to grow strong in the new sector. Tariffs will protect businesses from
international competitors which provides new established companies required time in order to
develop their own competitive benefits.
Non tariffs - Such are those barriers which are restricted trade through measuring other
than direct imposition of tariffs. It may conclude evaluation such as quality and content
requirement for importing products and subsidies from one place to another. This will help in
increasing popularity of specific organization among customers. By establishing quality and
content necessary for government that can restrict the imports facilities because their products
can be imported for meet the requirement of each customer. Such criteria are based on
advantages local producers. Along with this, country government can grant subsidies in which
direct funding help local manufacturers for keep their price fixed of products and services in the
large competitive market (Picciotto, 2017). In order to gain profit, ABC continental limited try to
import and export their products and services that can help in maintaining popularity in different
countries. Also they can export their goods and services in United Kingdom while expand their
business in proper manner. Non tariff consider as protectionist policy which assist in protecting
the development and improvement of new industries against foreign competitors. Since
international organisation create job opportunities from abroad to the country people.
Quotas - These are restrictions which limit the quantity or monetary value of particular
products and services which can be imported in given time period. The idea behind this in
reducing the quantity of competitive goods and services in the local market area that will easily
increasing needs and demand for local products and services. it is usually done by managing and
handling government issues licenses that allow organization or consumers in importing certain
quantity of commodities. In other words, quotas are non tariffs measures so they will take quite

various approaches than the other measures of barriers. This is the trade barriers which face by
ABC continental limited organization at the time of expanding or growing their business in
United Kingdom for gaining large amount of income or profitability (Stahl and Tung, 2015). It is
also considered as protectionist policy which assist in protecting small industries like ABC
Continental Limited from international rivals and allow them to grow without creating threats at
the time of growing organisation in foreign place.
c) Ethical, social and legal issues that needs to be taken into account
There are various issues which are related to ethical, social and legal that required to be
taken into account are described as under:
Ethical issues:
Confidentiality - It is required for every company is to maintain confidentially in their
each decision which are taken by their firm owners for the welfare of them. This is required for
every employee and worker is to taken part in decision making procedure to maintain
confidentiality and does not share information and data to anyone (Picciotto and Mayne, 2016).
ABC continental limited organization required to make protection of their customer's details and
personal information from each individual. Sometime hackers are try to hack company details
and use for wrongful purpose that are damage their business image in the market place.
Culture consideration - it is important part which help in make or break the firm while
conducting business at international level. Every culture and nation has its previous history,
tradition, custom, code of ethics. There are various cultural barriers which includes languages
that are often means a organization must be rely on translator at the time of interacting with
business contacts and customers.
Social issues - These are directly affect on organization activities and functions that are
well being on the society. This refers as the practices related to employees and employment
within an organization. Social issues include individual rights, privacy, protection, social
responsibility and so more. Most of the business decisions are directly influenced by employees,
customers, suppliers and competitors while expanding business in another country. As ABC
continental limited are try to set up business in United Kingdom where they sell different type of
infant products in order to gain huge income.
Legal issues:

Employment law - At the time of expanding business in new country, most of the
organization face such issue where they need to hire more people in that region. They should be
well informed about local employment laws so they defer from areas to area. Along with this, the
local government is most common which have jurisdiction over them. ABC continental limited
also required focusing on such issue which occurs while expanding business at international
level such as UK.
Foreign law - Most of the company think that foreign law is not applied on their business
but they are wrong because they require permission of specific country before selling any
products and services (Hovhannisyan and Keller, 2015). It is necessary for every organization
to learn another country law before entering into their market. This will help in easy deal with all
government formalities without any restrictions so they can set up their business in any region
for gaining profit and income.
d) Cross-cultural issues that is relevant to the proposed venture
There are various cross culture issues while expanding business in another country by
ABC continental limited that are described as follows:
Inadequate trust - It is the main cross culture issue where an individual does not trust on
another person due to lack of bonding. For example, if ABC continental limited manager wonder
that India teammates speaks in Hindi in the office so all the other employees does not understand
their language because they understand English language so this will create issue among them.
Perception- Every individual have different thought and opinion which has been develop
or build by their experience and culture. It is the main issue which occurs among managers,
employees and other staff members who works in another country and belongs to different
culture. For example, If ABC continental limited company's employees are give their opinion on
their culture so this will create main issue among other staff members who belong to UK culture
so they are agree with them (Meyer and Peng, 2016).
Inaccurate biases - If ABC continental limited company is doing biases among
employees so this will create issues and make decisions in the group and UK people do not
deliver on time are create problem in different culture. This will create biases among different
culture people.
False communication - Communication is one of the major issues which are faced by
ABC continental limited organization at the time of expanding business operation and function

in another country such as UK. For example, during discussion Indian people does not
understand UK employees accent which create confusion among them.
3. Evaluate the feasibility of the proposed venture in the current UK market environment
a) E-commerce option versus other methods of expansion
There are various types of e-commerce options which can be used by ABC continental
limited company at the time of set up business in specific market area of UK. These are
described as under:
Business to business (B2B) – E-commerce consist with encompasses in all electronic
transactions of products and services which are conducted between companies. The producers
and traditional commerce wholesalers are usually operated and regulated with the help of
electronic business which attract large number of customers (Cravino and Levchenko, 2017).
Business top consumer (B2C) - this is that type of e-commerce which is different buy the
establishment of electronic business relationship between different businesses and final users. It
is corresponds to the retails section of e-commerce in which traditional retail trade is operated by
business owners of ABC limited.
Consumer to consumer (C2C) - It is that type of commerce which encompasses with all
electronic dealing of different goods and services that are conducted between consumers. This is
another option of e-commerce which can use by company for attracting customers towards their
goods in better manner.
Consumer to business (C2B) - this is the complete reverse of the traditional sense of
exchanging products and services. In this, e-commerce is very common in crowd sourcing based
projects. Most of the customers develop their services and goods available for purchase for
companies' desire with such of products.
Along with this, there are various types of expansion methods which can be used by
ABC Continental limited for establish their business in another country that are described as
under:
Joint venture - It is the best method for ABC continental limited organization is to
expand their business for selling different types of products and services among customers.
Setting up company by jointly owned and regulated by two or more companies which is known

as joint venture. The business can gain high advantages from local partner's knowledge of the
host nation's competitive situations and conditions.
Licensing - It is the very attractive approach for firm which has lack of capital in order to
develop overseas operations. This is an arrangement by an organization to grant the rights to
intangible property in another entity for time period and in return fees are charged by the licensor
(Richter and et. al., 2016). The main benefit of this method of expansion is that ABC Continental
limited can maintain and manage their business operation in better manner for attracting large
number of customers.
Franchising - This is another method of expansion which can be used by ABC
continental limited for expansion of business in United Kingdom. It is the specialized form of
licensing in which franchisor sells the intangible property and provide business help to the
franchisee. By using this, an organization can easily develop international presence and run
operation rapidly at lower cost and at risk.
b) Aspects of international marketing relevant to the proposed venture
ABC Continental limited is try to set up the business venture in UK and they intend to set
up e-commerce platform where they sell organic cotton wear for infants in united kingdom.
There are main aspects of international marketing which are relevant to business venture that are
described as under: Research - it is required for company is to analyze whole market area where they
establish their business and attracting large number of customers towards organization
goods and services. In the context of ABC Continental Limited, they required to examine
and search whole UK market region before establishing their business operation in order
to gain more income and profit. Infrastructure - It is another main aspect of international marketing which are totally
relevant to ABC Continental Limited because they are start retail store in United
Kingdom where they need suitable infrastructure for gaining attention of large number of
buyers. This is required for firm is to set up unique infrastructure through which country
people are show their interest with the new store products and services. Product must be localized - ABC Continental Limited needs to manufacture and develop
local products which can easily gain attention of such country people towards company

products and services. Also they required to focus on culture, trends and customs which
easily attract them (Richter and et. al., 2016).
 Communication - It is required for firm is to focus on interacting with customers through
message should be appropriate for local market people. They should learn UK local
language which helps them in easily interact with any type of customers in the large
market place.
c) Potential impact of Brexit on the venture
The impact of Brexit in retail business in positive form because company can easily
acquire funds from the country government for smoothly run their business. A decision has been
taken by British public, which came as much of surprise and it is likely to have far reaching
consequences. In addition to this, Brexit will have substantial consequences for the European
economy but even more so for the British economy. By the recent data, it has been analysed that
the impact of UK's decision to leave the European Union to the UK retail industry which has
more moderate than expected by everyone. This is come with the perfect time when many
retailers are trading on slim profit and decreasing the sales as they get to know the new breed of
consumer.
CONCLUSION
From the above described report, it can be analysed that International business defines as
all the commercial transactions which arise between two or more regions, nations and countries
beyond the political boundaries. in addition to this, as the business expand with the help of
merger and acquisition that may offer desired in order to reach with changes in growth and
services provided to enter into new geographical market area. It is required for ASBC continental
limited is to identify major business key drivers which help them, in expanding business in
international market like UK. Trade barriers are restrictions' on international trade imposed by
country government. They are developed to impose the extra cost and value on imports and
experts in order to protect the local businesses. Social issues include individual rights, privacy,
protection, social responsibility and so more. Most of the business decisions are directly
influences by employees, customers, suppliers and competitors while expanding business in
another country.

REFERENCES
Books and journals
Perlmutter, H. V., 2017. The tortuous evolution of the multinational corporation. In International
Business (pp. 117-126). Routledge.
Doz, Y. L., 2017. Strategic management in multinational companies. In International
Business (pp. 229-248). Routledge.
Penrose, E. T., 2017. Foreign Investment and the Growth of the Firm 1. In International
Business (pp. 33-48). Routledge.
Wiedersheim-Paul, F. and Johanson, J., 2017. The internationalization of the firm—four swedish
cases 1. In International Business (pp. 127-144). Routledge.
Brannen, M. Y., Piekkari, R. and Tietze, S., 2017. The multifaceted role of language in
international business: Unpacking the forms, functions and features of a critical challenge
to MNC theory and performance. In Language in International Business (pp. 139-162).
Palgrave Macmillan, Cham.
Bartlett, C. A., 2017. Multinational structural change: evolution versus reorganization.
In International Business (pp. 259-283). Routledge.
Vagts, D. F. and et. al., 2015. Transnational business problems. West Academic.
Picciotto, S., 2017. Rights, responsibilities and regulation of international business.
In Globalization and International Investment (pp. 177-198). Routledge.
Stahl, G. K. and Tung, R. L., 2015. Towards a more balanced treatment of culture in
international business studies: The need for positive cross-cultural scholarship. Journal of
International Business Studies. 46(4). pp.391-414.
Picciotto, S. and Mayne, R. eds., 2016. Regulating international business: beyond liberalization.
Springer.
Hovhannisyan, N. and Keller, W., 2015. International business travel: an engine of
innovation?. Journal of Economic Growth. 20(1). pp.75-104.
Meyer, K. and Peng, M.W., 2016. International business. Cengage Learning.
Asaad, S. and et. al., 2015. Multi-petascale highly efficient parallel supercomputer. U.S. Patent
9,081,501.
Cravino, J. and Levchenko, A. A., 2017. Multinational firms and international business cycle
transmission. The Quarterly Journal of Economics. 132(2). pp.921-962.
Richter, N. F. and et. al., 2016. A critical look at the use of SEM in international business
research. International Marketing Review. 33(3). pp.376-404.
Online
Types of Trade Barrier. 2018. [Online]. Available through: <https://quickonomics.com/three-
types-of-trade-barriers/>.