Critical Analysis of Morrisons' International Trade in UAE Market

This report examines Morrisons' international trade strategy, focusing on its potential expansion into the United Arab Emirates (UAE). The report begins with an introduction to international trade and its importance for business growth. It then analyzes key international trade and business issues that could affect Morrisons' decision-making process, including a critical evaluation of relevant academic literature. The main body of the report includes a PESTLE analysis, assessing the political, economic, social, technological, environmental, and legal factors influencing Morrisons' operations in the UAE. A Porter's Five Forces analysis is also conducted to evaluate the competitive landscape. Finally, the report provides recommendations for Morrisons' market entry strategy into the UAE and outlines a plan for implementing these recommendations, considering Porter's generic strategies and offering a comprehensive assessment of the challenges and opportunities associated with international trade.

Managing
International Trade

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Summative Assessment...................................................................................................................1
Critical analysis and evaluation about key international trade and business issues would
potential affect with business decision making and academic professional literature................1
Pestle Analysis............................................................................................................................2
Porter Five Forces.......................................................................................................................5
Recommendations and a plan for implementation of the recommendations..............................6
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11
.......................................................................................................................................................12

INTRODUCTION
International Trade refers to the exchange of the capital, goods and services across the
international borders or territories which will be quite helpful in ensuring that the business of the
companies can be done in a right manner effectively and efficiently (Blomqvist and Turkulainen,
2019). Therefore, it is important for the organizations that they are able to conduct the
international trade in a proper manner which will help them in expanding their business. For this
report, Morrisons has been selected. It is a company which provides a range of products as well
as services to the different types of customers. It is planning to expand its operations in UAE. It
is a country in which there is a presence of various types of trade opportunities which will help
the company to grow in the right manner. In this assignment, a detailed focus will be made on
the critical analysis and evaluation of the key international trade and business issues which will
affect the business decisions. Additionally, a specific analysis will be made on the clear
recommendations and a plan as a part of this project.

MAIN BODY.
Summative Assessment
Critical analysis and evaluation about key international trade and business issues would
potential affect with business decision making and academic professional literature.
In concept of international trade is exchange of capital, goods and services that across
international borders or territories there is need or want about goods and service. In most of
countries where such trade represents within differently share for Gross domestic product
(Frenzel, Kumar and Sedgwick, 2018). International trade was the key to rise towards global
economy where proper supply and demand and thus prices as well as impact prevents global
events. The major relationship prevails for exports and imports on which product that is brought
from global market is an import (Rabbi and Mostafa., 2018). Imports and exports are accounted
for current situation balance payments. The necessity of international trade when there is good
enough of resources or capacity to attain and domestic demand. The importing essential goods a
country which can assort to their domestic resources for manufacture goods and services. Then,
the specific country can exports the surplus in international market. The process of importing
good and services with an reasons are considered:
• Price: If the foreign companies can produce or offer good and services is comprise
more cheaply, it might provide proper beneficial to go for foreign trade.
• Quality: On the basis of company who are settled in abroad they offers about certain
good and services within excellence quality.
• Availability: This is tend to company perspective to focus on crowd market on which
product and service easily available for better attain customer retention.
• Demand: It is provide better product and service within more than one country.
As per company Morrisons is multinational supermarket where it is fourth largest chain
supermarket in the United Kingdom and it headquarter in Bradford, West Yorkshrie, England.
As they are planning to invest their sales and work operation in international or foreign country.
The market which is opted United Arab Emirates in which it is must to critical evaluate about
international trade level as well as external influence that matters for Morrisons.

Pestle Analysis.
It is an framework or tools which utilised for analysed and monitor the macro
environment factor which may have defined on organisation performance (Zengeya and Van
Wilgen, B., 2017). This tools is helps to scrutinise information for starting new business or
entering a foreign market. The business is to measured on political, economic, social,
technology, environment and legal.
As Morrisons is planning to invest and establish their venture into United Arab Emirates, in
following there is description about pestle for consider Morrisons perspective:
• Political factor: The United Arab Emirates is a constitutional federation, it depicts
seven emirates which means about Abu Dhabi, Ajman Dubai and further names. Each
emirate is governed by the ruler while the Federal Supreme council as Abu Dhabi is the
main capital of United Arab Emirates (Ozemre and Kabadurmus, 2019). This country is
big power in middle east and has considerable influences at global stage too. As UAE is
famous to maintain good diplomatic and trading relation with the United States, Saudi
Arabia , china, and many other countries in the region and beyond. Many analysts argue

that the political freedom in UAE is very limited election are held for federal advisory
bodies which runs independent.
• Economic factor: In the United Arab Emirates is having number of international
economic and political forums example the United Nation, World Bank, International
Monetary Firm, Arab League, OIC and one of 27th largest economy within world. The
calculation of GDP was 414.8 billion US dollars. In the perspective of GDP growth rate
averaged about 4.34% from 2000. As the rate of Crude petroleum, refined petroleum,
gold, diamond and petroleum gas are one of top exports of the United Arab Emirates .
And these exports are main factor to increase profitability as well as economic growth.
The United Arab Emirates is one of richest countries as it counted on their per capita
income. There is major diversification on which remarkable economic progress over the
years and the factors which involves are natural resources, economic diversification and
innovation inflow about foreign direct investment. According to the world investment
report in 2019. But there is possibility of natural and financial disaster can create high
rate of uncertainty such as Inflation and recession. Therefore, Morrisons can have
benefits in terms of profitability and it can also provide better outcomes to generates
within better manner aspects (Manova, Van Reenen and Yu., 2018). There is also one
advantage in UAE where there is low unemployment rate. This country also one of
highest amounts of foreign direct investment in the region.
• Social factor: This factor involves about some of factor which inhabitants of the United
Arab Emirates typically for live comfortable lifestyles that is well pays jobs. In fact,
UAE is one of democratic country and enough population can allows chances for other
company like Morrisons to target large number of audience which is greatly effect to
society within Emirates. Religion is also one of important factor in which there is
greater affect society.
• Technology factor: According to this factor is determine to focuses on social media
platform. Their is having average speed of 2.56 hours on social media daily
Approximately, 82% of the United Arab Emirates is having enough population as their
profile are generate in Facebook while You Tube's penetration also stands at 82% and
social media are use to twitter, LinkdIn, Instagram and social media. In perspective of

Morrisons they can approach to online business to attract customer as more way. The
government has invested heavingly in space science, nuclear science and ICT over the
years.
• Environment factor: The United Arab Emirates is one of the most visited countries in
the world. Perfect balance between traditional culture and modernity, luxuries hotel and
advanced shopping malls, skyscrapers within versatile cuisine are some of the factor
that attract millions a tourists every year (Sun and et. al., 2018). As per weather forecast
perspective, this country is dry, hot and climate which allows results which can attain
results in many different things. For example, productivity might be lesser where it is
not air conditioner where have potential to sell well. The United Arab Emirates is
having sea, few costal areas allowing for easier trade by sea.
• Legal factor: As per this factor country where little sense of discussed about legal
factor that affect it a whole as opposed towards laws affecting those inside. There is
less scope of advantage in freedom as rules are strictly formulated such as no physical
relationship before marriages, not click photo without permission, business mergers
could not presumes until unless government of United Arab Emirates not provide permit
for it.
Evaluation:
As per above pestle analysis for Morrison in background of United Arab Emirates is
having opportunities within Economic factor and technology where the GDP growth rate is quite
productive enough to sustain for long time perspective as in other phase resources are available
in advanced level, in which Morrisons can acquired this advantage in better manner. Morrisons
has also one advantage that to acquire people from social media as many people are active on it.
Porter Five Forces.
This framework of porter five forces is analytical model that helps to marketer and
business managers which seems maintain power between power for different organisation
through global level and analyse attractiveness and potential profitability of an industry sector.
• Threats of new entrant: In the United Arab Emirates there is high scope of new entrant
power within competitive companies are already established in retail perspective.. In

perspective of Morrisons, there are some enough small and large company to attract
customer on online and offline platform.
• Bargaining power of Supplies: In this situation there is high bargaining power of
supplies which indicates for Morrisons company to have negotiate within suppliers. The
reason behind other company's are Tesco, Walmart, Marks and Spencer are actively
participate to easy implement (Hopkinson and et. al., 2018). Powerful supplies in United
Arab Emirates are there where wide range of retail business commence to bring large
number of supplies.
• Bargaining Power of Buyers: As per this situation there is moderate level of buyers
bargaining because in United Arab Emirates, Morrison product and service can attract to
middle range and premium range of people that will allows moderate power within
market and buyers. As there is largely innovative product. Customer are often to seek
discounts and offering on established product so if Morrisons marketplace plc keep in
coming up with new product then product then buyers.
• Threats of substitute product and service: At the time of new product and services
introduced in market it provide suffer to other industries for compete in competitive
advantages. For Morrison if they introduced their new product and services in market of
United Arab Emirates that particular product is enhance different quality of specification
with other product and services then it having high threats for other retail company in
UAE. But at beginning for Morrison there is low power of threat of substitute.
• Rivalry among the existing competitors: It rivalry is among existing player is an
industry where the driven down prices and decrease the overall profitability within
industry. For Morrison, the competitors with existing companies of retail venture is
consider as high power. Because many premium base companies like Burberry, Marks
and Spencer retail venture are high rivalry for Morrisons.
Evaluation
On the basis of Porter Five forces enhance for Morrisons in United Arab Emirates where
it is supportive tool that provide essential information about external as well as internal market of
specific country and company (Young,, 2018). In above situation Morrisons have to face some

sort of challenges in terms of supplier bargaining power, new entrant of new online retail
business within competitive business.
Recommendations and a plan for implementation of the recommendations
The use of Porter's Generic Strategies has to be made so that the overall evaluation of the
strategies to be applied by the organization in the foreign country can be analysed in the right
manner (de Leeuw and et.al., 2016). Therefore the application of this particular model can be
explained in the following manner-
Porters generic strategies: Porters generic model has various elements which includes
narrow, broad market for cost leadership, differentiation, focus, cost focus strategy for businesses
(Epps and Schneiderman, 2016). This generic model helps businesses for achieving competitive
advantage. Elements cost focus, differentiation focus are related to price, unique goods. Cost
focus is about businesses should focus for its pricing strategy, differentiation focus is about
businesses should focus about their unique goods for businesses.
Cost leadership strategy: Porters generic strategies using for achieving competitive
advantage. There are various elements for achieving cost leadership strategy which includes
increasing profits for reduce costs while charging industry average prices, increasing market
value by charging lower price (Liu and Peng, 2016). In context to Morrison, it expands its
businesses for UAE. It decreases price for achieving competitive advantage. The costs
leadership strategy is about which includes businesses are leader for their costs. They has lower
price strategy which increases their profits, brand value. It expands its businesses for UAE it has
to set less price which helps it for increasing brand value, achieving competitive advantage.
Differentiation strategy: Differentiation includes goods different, more attractive than
competitors. It needs better research, development, innovation, ability for deliver high quality
goods, better sales. Large businesses pursuing differentiation strategy need for stay for their
goods development process. In context to Morrisons, it generates businesses for UAE, it should
develop different goods than competitors which helps it achieving customers. Customers wants
unique goods which brand gives them they purchase goods by those businesses. Focus strategy
ensure is about businesses increasing better quality for goods. It includes cost focus,
differentiation focus for businesses. Costs focus strategy is about businesses focus for costs

which they sales for market. Differentiation focus strategy when businesses enter into new
market, it views for unique goods which increasing customers.
Cost focus strategy: It is about when businesses has narrow market, costs elements.
Businesses should views for their pricing strategy, it has narrow market for which it should focus
for their price strategy which helps it for increasing customers which generates more income
(Miglietta and Morrone, 2018). When goods price less for market customers purchases those
goods which has less price. Businesses should set less price for their goods which increase
customers for generating income for businesses.
Differentiation focus strategy: It happens when businesses has unique goods, narrow
market. For this it should focus for unique goods which increases market share for customers for
businesses. When business entering for market for attracting customers it should focus for unique
goods which helps them for increasing customers. It is where market is broad, business views for
unique goods for customers.
Morrisons enter for new market for this it should focus for its price, unique goods. It
should set less price, unique goods which will attracts customers for purchasing their goods. It
should views for cost leadership strategy.
Recommendations-
It is quite essential for the organizations that they are able to put their focus on ensuring
that they can use the wide range of recommendations in a proper manner which will lead towards
the attainment of goals and objectives in the short-term, medium-term and long-term. Therefore,
the recommendations for the management of Morrisons which are related with expansion in
UAE are as follows-
 It is recommended to the management of Morrisons that it identifies the locations for its
expansion in UAE (Ozemre and Kabadurmus, 2019). This will be quite helpful for the
managers of the companies because this will help them to be able to achieve the wide
range of goals and objectives in the future effectively and efficiently. The locations where
it can expand in UAE are Dubai, Sharjah and Abu Dhabi. These are the locations which
have substantial base of customers and therefore offer a best chance to the management
for ensuring that it can attain the wide range of goals and objectives effectively and
efficiently there.

 It is also recommended to the management of Morrisons that it is able to ensure that it
takes strategic actions for the expansion of its business in UAE in the right manner
(Pannell, 2017). This will help it to be able to ensure that it can attain the wide range of
short-term, medium-term and long-term goals and objectives in a proper manner.
 The recommendations for the managers of Morrisons is that they should be able to
identify the multiple options for the targeting of strategic growth effectively and
efficiently (Tuerk, 2019). Therefore, this will be quite helpful for it to be able to raise the
overall level of standards properly.
 For the management of Morrisons, it is recommended that they must be able to ensure
that they can options for the application of the marketing and promotional strategies in
the right manner (Zejnullahi and Bajgora, 2020). Therefore, In this way this will help the
company to attain a higher-level of overall efficiency and effectiveness and therefore
attain a strategic and competitive edge over the competitors in the market.
It is necessary that a proper plan can be prepared so that the recommendations can be
implemented in the right manner quite effectively and efficiently. The Plan for Morrisons is
explained as follows-
Plan
Recommendations Actions to be taken
Identification of the locations The locations- Dubai, Sharjah and Abu Dhabi
have been finalised for the strategic expansion
targeted by Morrisons. Therefore, In this way
these locations will be quite useful for the
company in order to be able to strategically
target the achievement of the goals and
objectives.
Taking of strategic actions The strategic actions can be taken in the right
manner by the management of Morrisons by
identifying the amount of funds required to set
up the operations, identifying and assessing the
overall needs and requirements and taking of

the appropriate actions effectively and
efficiently.
Identification of multiple options for growth The identification of the multiple options for
growth can be done by ensuring that the
management of Morrisons identifies the
segment of customers who they will target
which will be thus helpful for the company in
attaining a higher-level of growth effectively
and efficiently in the right manner in the
future.
Application of the marketing and
promotional strategies
The application of the marketing and
promotional strategies can be done by ensuring
that the appropriate budget for these strategies
can be set up and therefore the management of
Morrisons is able to help in the overall
attainment of the wide range of goals and
objectives in the short-term, medium-term and
long-term effectively and efficiently in the
future so that the marketing efficiency and
effectiveness can be enhanced.