International Business - Assignment PDF

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International Business
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Introduction
Globalization has become the main factor in the present business world. This
phenomenon impacts the business life, economy, environment and society in different ways. Due
to global changes in the currents world, change in economic and business activities, political,
transport and communication and development of technology force enterprises to struggle for
survival by changing their strategies and going beyond their borders. Globalization is termed as a
natural process that results from the growing and rapid process of generalization of the character
and process of production. It is a worldwide trend whereby economies in different continents go
cross borders to connect with each other. An organization is no longer limited within their
borders and can implement several business activities globally. However, the entrance of firms
in the global market is inevitable because of globalization. This essay discusses the impact of
globalization in SMEs and other companies in general.
Globalization has enabled SMEs to access the global market. The SMEs were not able to
access the global market for lack of internet connection. The internet connection hindered SMEs
to access buyers and suppliers across the world (Uhlaner, et al., 2013, pp.593). Now every
customer can access different products or services being sold using a smartphone. This increases
the revenue of any small business beyond what they were able to produce before globalization
took effect (Wirtz, Tuzovic and Ehret, 2015, pp.571). Networking and internet have made it
easier for SMEs to compete globally due to the flow of information despite the physical location
of the seller and buyer. Additionally, globalization allows international companies to hold
meetings from headquarters and branches among managers relieving them travel expenses and
time.

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Globalization has led to competition among SMEs and international companies.
Companies enter global strategies to maintain or gain a competitive advantage in foreign markets
and to evade competition in the local markets. International competition is big and is growing at
a faster rate with more multinational competitors who win markets worldwide (Chen and Zhang,
2013, pp.43). SMEs and other companies enhance their competitive position by stopping
competitors in international markets or premature entrance into the domestic market of their
competitors in order to suppress its development. The increase in speed and prevalence caused
by globalization opens opportunities for the companies to perform on the international markets.
The managers, therefore, come up and develop strategies for internationalization that helps them
to transform their firms into globally competitive enterprises (Olimpia and Stela, 2017, pp.31).
The managers seek to link the supply, marketing, production and other activities based on the
international markets. SMEs and other companies face challenges and pressure when they
compete globally which requires the companies to cut costs to prevent consumers from regarding
their services and products as too expensive. The companies in the developing countries are
forced to locate production facilities in areas where production costs are lower. For SMEs and
other companies in developing countries to preserve the tastes and preferences of customers,
there should be differentiation of products, distribution channels, government regulations, and
management of human resources. The tactics and strategies for differentiation of services and
products in local markets create extra costs which can lead to increased costs for the company.
Globalization in developing countries has led to the development of markets.
Communication and information technologies, widespread cultural exchange, international
tourism development, along with improved living standards in most developing nations have
resulted to the emergence of a group of customers in different regions and countries (Palacios-