Tapping into New and International Markets

This assignment explores the opportunities and threats faced by Allied Irish Bank in a competitive global environment. It also discusses the implications of international trading blocks and agreements for the bank. Additionally, it evaluates ways in which SMEs can tap into international markets.

Tapping into New and
International Markets

Table of Contents
INTRODUCTION ..........................................................................................................................3
PART 1............................................................................................................................................3
LO1..................................................................................................................................................3
Explanation of Global Business Environment............................................................................3
Evidence based Analysis of Global Business Environment.......................................................5
Threats and opportunities that are faced by Allied Irish Bank in an increasingly competitive
global environment.....................................................................................................................6
Critical analysis of implication of threats and opportunity.........................................................7
LO2..................................................................................................................................................8
Determination of international trading blocks and agreements..................................................8
Evaluation of advantages of international trading blocks and agreements and their
implications for Allied Irish Bank.............................................................................................9
Tariff and non tariff barriers that exists in international trading environment .........................9
CONCLUSION..............................................................................................................................18
PART 2..........................................................................................................................................19
Covered in brochure..................................................................................................................19
REFERENCES .............................................................................................................................22

INTRODUCTION
With the enhancement in the integration and connection between various global
economies and nation the organisation also started for looking better growth opportunity and
ways of expansion in the global environment. The rise and improvement in the technology
together with the reduction and liberalisation in trade barriers and policy it become more easier
and convenient for companies to expand globally and operate at international market. This
assignment is based on tapping of a new and international market the chosen organization is
Allied Irish Bank which is a commercial bank situated in UK and providing various financial
services to its customers. This report includes an analysis of opportunities and threats faced by an
organization in globalized environment together with advantages of trading blocks for firm.
Beside this, the importing and exporting process along with their practicality is also included.
Further, this report consists an evaluation of ways in which SMEs can tap into international
markets.
PART 1
LO1
Explanation of Global Business Environment
It is very important for an organisation to appropriately and effectively be aware of the
global business environment in which it operates, as it represents different facets and aspects of
the surroundings of the firm that could be a major influence on the sustainability and growth of
the company.
Allied Irish Bank is a SME organisations within the United Kingdom, which provides its
financial services to its customers within the nation. Quite recently, the company is expanding
itself in the trade bloc market of Europe, specifically in Malta, which the firm believes could
prominently be used for expanding the business operations effectively. In addition to this, there
are several aspects which are related to the global business environment, which are described
below in context of Allied Iritsh Bank: Political Factors: Furthermore, countries like Europe has a favourable environment for
the company to expand their business operations within their trade bloc market as they
present the organisation with ample opportunities due to being politically stable and
progressing nation. For example, the legislation and political position of the organisation

is favourable in terms of investments and imports, which is an advantage for the company
to ensure better and more structured access to finance within the region. In addition to
this, EU is very much in favour of Foreign Direct Investment, meaning that the firm
could do business within that country quite easily, due to having favourable
governmental support. Economical Factors: These factors are the ones which covers a country's economic
performance which directly influences the trade bloc market of that region, upon where
the SME is planning to expand. UK currently is struggling due to the events of Brexit,
which has led to decrease in the value of pound and enhancement in inflation. Moreover,
this has also led to limited cash flow within the market, which would not be beneficial for
the company to acquire funding for its expansion. However, this presents the company
with an opportunity as the market of Europe is quite sustained and has progressive
economy which would provide the firm with better accessibility in terms of funding. Social Factors: These factors undertake all the trends, customer preferences and social
concerns within a country which has a direct influence on the SME in expanding its
market in the region. In context of Allied Irish Bank, the current trend within the Banking
sector has individuals wanting more technologically advanced and reliable financial
services, along with ease in payment options. This could be a major opportunity for the
bank in relation to provide the same to its customers for better attraction and retention. Technological Factors: For instance, due to enhanced access in digitalisation and
transportation, Europe has acquired top technologies from all parts of the world and is
using the same in relation to the organisation. One such technology is Artificial
Intelligence which allows the firms like Allied Irish Bank to secure financial transactions
and hence, is an opportunity for the company. However, the city is an offshore zone,
meaning that the financial designation of the country has been structured in a way to
attract international residents too. Hence, in this regard the AI would help the firm in
providing security to the international clients that would be a opportunity for the
company. Legal Factors: These factors are the ones which cover the legislations and rules and
regulations of a country. In context of Allied Irish Bank, due to Brexit, there are several
drastic changes within the legislation surrounding the banking sector of the Europe if an

organisation belongs to the UK, which are very much difficult to map and anticipate, and
could be a major threat for the organisation in context of expanding its business within
the European Union.
 Environmental Factors: These are the factors that are related to the environmental
sustainability within the trade bloc market. Within Europe, the government and the
industries are very much inclined towards ensuring sustainability of the environment and
has several legislation and policies to govern the same. Hence, this presents the company
with an opportunity associated with adhering to these policies and ensuring a better and
sustainable practice which would allow the firm to gather support of communities and
government. Furthermore, the SMEs that want to expand their markets within the region
are very much required to adhere to these aspects in order to succeed in the trade bloc
market of the region, which is an opportunity for Allied Irish Bank.
Evidence based Analysis of Global Business Environment
Hence, analysed under are certain of these drivers with respect to Allied Irish Bank:
 Market Share Growth:
One of the key drivers of globalisation is related to growth within the market share which
is possible as more market is captured when a company moves internationally. Furthermore, with
new customers and products, firms could make this growth very certain.
 Competition:
Another key global driver for a firm like Allied Irish Bank is competition. Allied Irish
Bank has several local as well as global competitors which are a constant threat to the
organisation. Hence, in this relation, the firm must expand its business globally within countries
like Europe to ensure effective growth in sustainability and competitive advantage.
 Technology:
This is another factor which drives companies to expand globally. The reason for this is
because with technology like automation and ICT, information could be facilitated globally in a
second, which provides advantage to the company in enhancing their market space effectively.
How trends of globalisation impacting SME growth
There are several ways through which globalisation is impacting the SME growth within
the region. Some of these ways are explored below:

 Enhanced Access: One of the major impacts which SME's are facing by the globalisation
is enhanced access within the global market. With new trends of transportation and
travelling, companies could set up their units in different locations with easy access to
their resources, suppliers and other aspects like technology. This has a positive impact
within these organisations as it could help them in enhancing the scope of their expansion
within countries within EU.
 Competition: Another aspect which have an impact on the SME's. With rise in
globalisation, there is also a rise witnessed in trends within the competition. Each
organisation has multiple companies as their competitors who adopt different strategies to
sustain a better market position. The impact could be both positive and negative within
the companies and it influences their practices which must be to ensure high quality
products that are promoted and positioned in a better manner than their competitive firms.
Threats and opportunities that are faced by Allied Irish Bank in an increasingly competitive
global environment
Threats of increasingly competitive global environment.
The threats that are faced by Allied Irish Bank in an increasingly competitive global
environment are:
Stiff Competition- The biggest threat faced by Allied Irish Bank in global environment is
high lavel of competition form big multinational companies. At global level the big international
organisation make use of effect8ive research and development and are able to provide better
quality product at low prices which created a threat and pressure on Allied Irish Bank to produce
and deliver good quality product and services with cost effective methods to maintain their
consumer base and integrity in the market. In business market of Malta a stiff competition is also
seen with the rapid growth of economy which is creating a threat for Allied Irish Bank.
Migration of staff- The another threat faced by Allied Irish Bank in competitive global
environment is associated with the migration of staff as the globalisation has made movement of
employees quite easy from one nation to another that has lead to transfer of talented and skilled
staff in big multinational companies cresting threat of mass turnover in Allied Irish Bank. Beside
this, in the global business environment an issue of high operating cost is also faced by Allied

Irish Bank. To solve this issue of mass turnover better interaction and employees engagement
policy can be adopted by Allied Irish Bank to remain profitable in global environment.
Opportunities of increasingly competitive global environment
The opportunities that are facilitated by competitive global environment for Allied Irish
Bank are as follows:
Technology development- The biggest advantage and opportunity lead by global
environment for Allied Irish Bank is it facilitates easy access to new and advance technology
regardless of locational barriers. Reach to advance facility provide better ways of production and
conducting other operations thus, facilitates achievement of cost efficiency and economies of
scale for Allied Irish Bank .
Better expansion possibilities- The global business environment has made expansion of
Allied Irish Bank easier through reducing the trade barriers and red tape associated with foreign
expansion. Thus, provide an opportunity for Allied Irish Bank to expand beyond the domestic
market to have better market share and profits through facilitating easy communication and trade
across nation.
Better business funding- Another advantage of global integration is that it has enhanced
funding options and number of investors for Allied Irish Bank through providing reach to banks
and investors all around the world. The increasing scope for FDI(foreign direct investment)
which is a positiver impact of global environment is helpful in meeting the financial needs of
Screenshot from Allied Irish Bank for better future expansion.
Critical analysis of implication of threats and opportunity
Beside this, an issue of migration of staff is also faced by Allied Irish Bank, that can be
solved through adopting better employment engagement policy with in the organisation. A
positive impact is also lead by competitive global environment as it facilitates availability of
latest and advance technology for Allied Irish Bank thus, makes its operation and functions
more effective and also lead to better expansion opportunity in various emerging markets of
world like Malta which a rapidly growing country of Europe. Thus, global environment creates
an opportunity for Allied Irish Bank to have expansion of its business operation across various
location of world which yield better market share and enhancement in customer base to earn
higher profits.

LO2
Determination of international trading blocks and agreements
Customs union- This type of trade block offer free trade area with members and a
common unified external tariff for non members I.e. members of trade block can negotiate with
third parties for better international trade.
Common/single market- It is considered as first step of a nation towards full integration
which is associated with removal of all barriers to trade in transfer and movement of goods,
services, capital and labour. Beside this, non tariff barriers are also reduced and eliminated to
provide a significant level of harmonisation within economies.
Form the above three type of trade block the most suitable agreement for Malta is
Common market as it facilitates free movement of people, goods, services and capital across
member nation that lead to enhancement in production efficiency through allowing free
movement of factors of production without any obstruction of national borders.
The Allied Irish Bank is entering in the Customs union trading block as it offers better
opportunity and makes it more easier to freely trade with the members and also yield the
advantages of a common and unified external tariff with non members trade block. The other
advantage of entering in a custom union by Allied Irish Bank is that it facilitates better
negotiation power thus, enhance the profitability and also lead to better expansion opportunity.
The main advantages of Trade blocks and agreements
the main advantages facilitated by trade block and agreements are as follows:
Size of market- The biggest advantage lead by trade blocks and agreements is
enhancement in foreign direct investment thus, beneficial for the economies of the participating
nation and also yield better opportunity for Allied Irish Bank. This yield an overall improvement
in the size and scope of the local firms thus, lead to enhancement in market share and yield
better growth opportunity for organisation of participating nation of trade block.
Economic leverage- The trade blocks and agreements allows free movement of factor of
production which lead to creation of economies of scale through allowing mass production
which lead to reduction in average cost of production of an organisation like Allied Irish Bank.
Thus, trade block facilitates increases in economic leverage for all the participating nation of

trade agreement. Beside this, faster transfer of technology is also facilitated by trade blocks
which improve the efficiency of production process and other operations thus, lead to better
productivity and achievement of economies of scale for the companies of participating nations.
Evaluation of advantages of international trading blocks and agreements and their implications
for Allied Irish Bank
Beside this, free flow of labour is also beneficial for Allied Irish Bank as they can have
assess to cheap labour thus, facilitates cost efficiency in production process and also lead to
economic leverage through meeting the objective of economies of sale in Allied Irish Bank. EU
is having effective trade management agreements to mange its relation with third countries
through creating better trading opportunities and overcoming related barriers. The Economic
partnership agreement are lead by EU for Allied Irish Bank that support development and better
trade relation with Caribbean, African and Pacific countries. Beside this Free trade agreements
and association agreements are also facilitated by EU that enable reciprocal market and bolster
border political agreements for better trade.
Tariff and non tariff barriers that exists in international trading environment
Tariff barriers
Tariff barriers are basically the tax, custom or duty imposed on products that are moved
or transferred across the domestic borders of nation which are levied by government or other
legal authority of a nation with the aim of protection of domestic firms and keeping a balance of
payments. The various Tariff barriers that exists in an international trading environment are as
follows:
Specific tariffs- It basically represent the fixed the fee and duty levied and imposed on
one unit of an imported goods. The specific tariff can vary with the type of good imported and
charged on per physical unit according to the weight and measurement of imported goods.
Ad Valorem Tariffs- The meaning of Latin word 'Ad Valorem' is on the basis of value
thus, it is a tariff levied and charged on goods on percentage value of the products traded. The
use of Ad Valorem Tariff facilitates more equitable trade barriers as the duty imposed on costly
items are more as compared to cheaper goods thus, reduce the burden of tariff for small
organisations.
Non Tariff Barriers

These are basically the non tax restrictions that are levied by government regulation and
policies for having a control and check on overseas trade. The various non Tariff barriers that
exists in an international trading environment are as follows:
Licenses- It is basically a written permission granted by the government that allows a
business to import and deal in certain type of goods at international market. Use of licenses is
made by government of a nation to create restrictions and barriers in free flow of trade with the
aim of managing competition and increase in prices and other issues faced by domestic
customers and firms.
Import quotas- This type of restriction or barrier is mainly placed on the amount of a
particular goods and product that can be imported by a company or individual from some other
nation. Thus, import of goods and product is allowed but only to a specified limit of quantity or
quota fixed by the authority.
The Tariff barriers like Specific tariffs and Ad Valorem Tariffs restricted the imports of
goods and services in an country through increasing the price of goods and services purchased
from other countries thus, facilitates a better control and check on international trade. On the
other hand non- tariff barriers like Licenses and Import quotas provide a better check and
monitor on operations of international trade through a more systematic and better mechanism to
restrict or enhance imports and exports in a country.

CONCLUSION

PART 2
Covered in brochure

REFERENCES
Books and journal
Arapova, E., 2017. Southeast Asia as the New Investment Pole. International Trends. 15(3).
pp.89-94.
de Oliveira, R. T. and Rottig, D., 2018. Chinese acquisitions of developed market firms: Home
semi-formal institutions and a supportive partnering approach. Journal of Business
Research. 93. pp.230-241.
Friedrichs, S., 2017. Tapping nanotechnology’s potential to shape the next production
revolution. The Next Production Revolution, p.157.
Gabor, D., 2018. Goodbye (Chinese) shadow banking, hello market‐based finance. Development
and Change. 49(2). pp.394-419.
Kolo, J., 2017. From innovation to sustainability: life-cycle polylemmas and strategic initiatives
for entrepreneurship in Africa. In Managing Knowledge and Innovation for Business
Sustainability in Africa (pp. 13-27). Palgrave Macmillan, Cham.
Minkman, E. and van Buuren, A., 2019. Branding in policy translation: How the Dutch Delta
approach became an international brand. Environmental Science & Policy. 96. pp.114-
122.
Mori, A., 2018. Connecting women to markets through SheTrades. In International Trade
Forum (No. 1, pp. 14-15). International Trade Centre.
Reimer, J. J. and Zhang, X., 2018. An economic model of search and matching in international
trade. Review of International Economics. 26(4). pp.784-800.
Rottig, D., 2016. Institutions and emerging markets: effects and implications for multinational
corporations. International Journal of Emerging Markets. 11(1). pp.2-17.
Tapping, D. and Shuker, T., 2018. Value Stream Management for the Lean Office: Eight Steps to
Planning, Mapping, & Sustaining Lean Improvements in Administrative Areas.
Productivity Press.
Vega, D. E. C. and Keenan, R. J., 2016. Situating community forestry enterprises within New
Institutional Economic theory: What are the implications for their
organization?. Journal of forest economics. 25. pp.1-13.
Yeung, H. W. C., 2017. Managing crisis in a globalising era: the case of Chinese business firms
from Singapore. In Chinese Business and the Asian Crisis (pp. 87-113). Routledge.