International Business: Expanding into China

INTERNATIONAL BUSINESS

EXECUTIVE SUMMARY
International business refers to the business practices which are the trade of services,
capital, goods, and technology in the international market means on a global scale. These
practices involve transactions which are between two or more countries across their international
borders. West Horsley Dairy is a company which has developed from a village dairy to company
that provides variety if products and high quality services. This company is a chilled food
distributor. The products of this company is very good and high in quality. This project will help
in the discussion of the drivers which will influence the company to expand its business in
China. In this project the barriers of expansion will be evaluated for this company in China. The
ethical issues which the company will face are also discussed. The importance of culture and its
preferences in the country for this business will be explained. This project will conclude with
providing recommendations and also the expansion methods for entering with this business in
China. The objective of this business is to enter the Chinese market. Company's target in the
market are the children of age group of 3-11 years with its UHT milk product.

TABLE OF CONTENTS
EXECUTIVE SUMMARY.............................................................................................................2
INTRODUCTION...........................................................................................................................1
Drivers of business and its expansion in China...........................................................................1
Key Business Drivers.......................................................................................................................3
Trade barriers in the international market....................................................................................4
Ethical and social issues which will be faced in China...............................................................6
Cultural preferences.....................................................................................................................7
Expansion methods......................................................................................................................8
CONCLUSION................................................................................................................................8
RECOMMENDATION...................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
International business is those activities which the business executes or plans on
executing in the international market. The Dairy industry in the UK has seen great successful
over the years. In the whole world UK has been the eleventh largest producer of the milk.
According to the studies it has been found out that the dairy business is said to increase in the
upcoming years. In China the dairy industry is also forecasted to grow however, it has to import
most of the dairy products. The demand of the dairy products in this country is said to increase in
this country. Due to which China has to import more dairy products. West Horsley Dairy is a
company which has developed from a village dairy to company that provides variety if products
and high quality services. In this company the total number of employees are around 500. This is
a private company which is situated in Woking, Surrey in UK. This company is planning to
target the Chinese market with its UHT milk. UHT milk is ultra-high temperature milk. In UK
120 million litres of this milk is produced. In China Mongolia Yili Industrial Group Co. is the
leading producers of this product. The Chinese market is ranked at the 31st easiest country for
doing business. The level of competition in this country is also high as it is 28th in the world
ranking. This has made Chinese market as the most emerging market and one of the best
economy for doing business. In this project the business drivers which will help the company to
expand its business in China will be discussed. The factors which will encourage this expansion
in the Chinese market will be explained with the help of PESTEL analysis. With the help of this
project the barriers which may arise for the expansion of the business in china will be highlighted
in this project. The issue in China such as ethical and social will also be understood for the
planned expansion of the company. This project will also talk about the cultural preferences
which should be considered by West Horsley Dairy for its expansion. In the end of this project
an expansion method will be selected for this company to expand itself in china.
Drivers of business and its expansion in China
PESTEL ANALYSIS
The PESTEL analysis with respect to any organization will deal with the political
economic social technological environmental and legal factors that will contribute as a part of
external analysis of the organization. PESTEL analysis is required because an essential output
will have to be gained only when a proper analysis is carry forwarded externally and internally.
This external analysis will help the organization to understand the consequences that are
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