Global Business Expansion Challenges: Burman and Sons Ltd. in Germany

This report examines the global business expansion of Burman and Sons Ltd., a manufacturing company specializing in steering gears, with a specific focus on their planned market entry into Germany. The analysis delves into the main streams of research in global business, highlighting Germany's favorable manufacturing environment and the government's investments in research and development. It discusses the complex changes within the global economy, particularly how these changes impact small and medium-sized enterprises (SMEs), including technological advancements, licensing systems, and funding challenges. Furthermore, the report critically evaluates the impact of social, legal, economic, political, and technological factors on the decision-making process of globally active firms, specifically addressing the challenges posed by political instability, trade wars, economic recession, an aging population, and cultural diversity. The report underscores the importance of adapting to these diverse factors to ensure successful market expansion and sustainable business practices. The report concludes by summarizing the various factors influencing Burman and Sons Ltd.'s expansion, emphasizing the need to navigate regulatory landscapes, demographic shifts, and economic fluctuations to achieve successful market penetration in Germany.

GLOBAL BUSINESS IN
CONTEXT

Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Main streams of research in the area of global business.............................................................3
complex changes occurring within the global economy and critically discuss their impact upon
a range of enterprises...................................................................................................................4
Critically evaluate the impact of differing social, legal, economic, political and techno- logical
factors on the decision-making process in globally and internationally active firms..................5
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................8

INTRODUCTION
A global business is a company that operates facilities (such as factories and distribution
centres) in many countries around the world. This is different from an international business,
which sells products worldwide but has facilities only in its home country. Globally expanding
the market can help the company in increasing their profitability aspects and sales. Present report
will lay emphasis on Burman and Sons Ltd. Company manufacture Burman Douglas steering
gear. It has been analyzed that company is planning to expand their market in Germany. They
will like to expand it till the year 2020. Report will highlight the challenges which can occur
globally while expanding the business. It will also lay emphasis on the social, legal,
environmental and technological impact of global business environment of Germany on
business.
MAIN BODY
Main streams of research in the area of global business
It has been analysed that Germany has been ranked 6 all over the world, as the best place to
develop the manufacturing business over there. Germany has managed to retain its core
manufacturing advantage by competing based on quality and not just cost, but also on making
the necessary investments to retain its role as a differentiated manufacturing destination globally.
So the decision to expand in Germany by Burman and Sons Ltd. Can be considered as quiet
beneficial for them. The manufacturing business in Germany has raised from 10% to 22.2%.
Also it has been analyzed that the government of Germany has also being making huge
investments in research and development, so this can help Burman and Sons Ltd. Firm to make
use of advancing technology and grow over there.
Germany has been firm in maintaining manufacturing advantage by focusing more on
quality. They have maintained this even after facing competition from China. The contribution of
manufacturing labor force in Germany’s Gross domestic income is 18.1%. Burman and Sons
Ltd. will also be able to earn more amount of profit as from a report it has been interpreted that
Germany in the year 2017 has been the world’s largest exporter of cars. The automobile sector in
country has employed 8,51,000 people. This has helped country in enhancing their economic
condition. It has also been analyzed that manufacturing sector in Germany is highly innovative
as the 70% of firm in country are investing in innovation and 30% of them are providing highly
innovative products. It has been analyzed that the manufacturing sector in Germany has provided

significant amount of revenue to the country. It has also been interpreted the automotive sector in
Germany is making use of disruptive innovation. So Burman and Sons Ltd company to establish
their market in Germany must also make use of new innovation so that they can attract
consumers over there. It can also support firm in growing and establishing their market in
country. By making use of disruptive innovation they will also be able to make huge amount of
profitability. This can help firm in growing.
complex changes occurring within the global economy and critically discuss their impact upon a
range of enterprises
The changes in Global business environment has impacted the small and medium sized
companies heavily. There are various macro environmental factors like social, political,
technological that can impact the working of Burman and Sons Ltd. Small and medium size
enterprises in Germany have faced mixed development, they have added 10.5% in Gross
domestic product during the year 2013-2017(Perry-Kessaris, 2016). It has been analysed that the
complex challenges which are faced by these industries are technology advancement. It is
because the transformation which are digitalised require high amount of investment in research
and development. Industrial revolution has also been one of the major challenges for the small
and medium sized industry. These can hamper the growth of Burman and Sons Ltd. It can also
lay impact the profitability aspects of company which is producing steering gear. Germany also
have really tough licensing system, so Burman and Sons Ltd. can also face tough challenge
related to obtaining licence in the country. It might include they have to go through really tough
documentation process. SMEs in public procurement procedures, such as the legal obligation to
keep the requirements for businesses participating in procurement procedures as moderate as
possible(Lewis and et.al., 2017).
It has also been analysed that small and medium sized enterprises while expanding the
business over there can face difficulty to have funds which can support them in establishing their
market share over there. There are several laws, rules and regulations which has been
implemented by the government of Germany. This can also negatively affect the growth aspects
of small and medium sized enterprises. Germany is also engage in making new policies and
procedures related to supporting innovation which has quiet helped small and medium
enterprises. Also the challenge that can be faced by Burman and Sons Ltd. company is that they
need to make sure that they do not hamper the sustainability and environmental aspects of

country. If this happens then it can negatively affect the growth criteria of firm. It can also build
negative image on mind of consumers which can hinder the goodwill of society(Kasemsap,
2018). As Germany support the new and innovative processed by small and medium enterprises
but also there is issue that for acquiring funding the company needs to prove that their innovation
is viable which can have supported and funded by government of Germany.
There is also another challenge which can be faced and suffered by small and medium
sized enterprises is that the purchasing power of people in Germany is facing a diminishing
trend. This can affect the business of Burman and Sons Ltd company negatively (Pikhart, 2017).
Also the aging population in Germany can also affect the new and innovative business falsely as
it is very difficult to make them understand about the latest and digitalised technology. For this
company can engage in making people know about the benefits of technology they are using. It
can help firm in growing and establishing their market share.
Critically evaluate the impact of differing social, legal, economic, political and techno- logical
factors on the decision-making process in globally and internationally active firms.
In order to expand the business in Germany, the small and medium sized manufacturing Burman
and Sons Ltd. company can be impacted by various social, legal and economic factors. The
impact can include following:
Political factor- It includes factors such as policies, regulations, tax rates given by government
that can affect the business. Burman and Sons Ltd. can also get affected by these factors while
expanding their market in Germany. Firm can face problem in expanding as the country is facing
political dis-balances. They have been converted from monarch government to democratic
republic which has caused chaos and riots in country(Hamilton and Webster, 2018). So it can be
quiet difficult for Burman and Sons Ltd manufacturing company to expand their market share in
Germany. Also it has been analysed that country is going through trade war with China in year
2019. Because of this the country has been engaged in changing laws, rules and policies related
to expanding of market. This can affect growth of Burman and Sons Ltd. manufacturing
company. This can affect the growth aspects of company.
Economical factor- It includes the various factors such as inflation rate, labour rate, fiscal
policies that can affect the manufacturing company like Burman and Sons Ltd. It has been
analysed that Germany is going through a drastic recession time due the trade war with
China(Doh, McGuire and Ozaki, 2015). The Economy of country has fall out because of the

trade war which is going on with China. It has been analysed that the Germany has a threat that if
tariff regulations made by USA is implemented in country then it can reduce the sales of steel in
domestic country. So this can affect Burman and Sons Ltd. firm negatively. It can also lay
impact on profitability aspects of company. They would not be able to establish their market
share in new market that is Germany. It has also been analysed that Trump has asked Germany to
impose huge amount of taxes on the manufacturing of cars. It also involves the parts of cars. So
Burman and Sons Ltd who is building steel gear of cars can be affected adversely by
taxes(Adekola and Sergi, 2016). It can reduce the sales of car parts manufacture by them. This
can also hinder the firm from growing and increasing their sales in Germany.
Social factor- These factors include the attitude, belief, thoughts and values of people which
needs to be addressed by people living over there. So Burman and Sons Ltd. company while
expanding market over there needs to lay emphasis on this. The main social crisis which can be
faced by small and medium sized enterprise is that the ageing population. Germans significantly
ageing population can reduce the economic growth by 25%(Salvatore, 2015). Also when the firm
is going to bring new and innovative products it is very difficult for them to make people of old
age understand this. Also it has been analysed that the purchasing power of people has also been
reduced in country, so this can drastically affect the business which company is going to
establish in Germany. It can also affect growth aspects of Burman and Sons Ltd. company. Also
it has been analysed that Germany is following parallel cultures, they have many immigrants
living in country. So when company is going to recruit people from over they need to make
policies of company according to them. This will help small and medium sized organization in
creating employee loyalty. It will also help them un growing their market share in Germany.
Legal factor- Various factors like laws, rules and regulations given by government can affect
growth of Burman and Sons Ltd. company. In this company needs to make sure that they are
providing healthy and safe working environment to employees so that they can work efficiently.
It will also help company in reducing the turnover of employees if they face any. They also need
to recruit people of diverse culture, so that they can adhere to rules passed out by German
government. This will also help firm in establishing their market in Germany(Tallman, Luo and
Buckley, 2018).
Environmental factor- In this factor Burman and Sons Ltd. manufacturing company can get
affected by various environmental laws which has been passed by German government. In this

firm needs to engage in following various corporate social responsibility. They must engage in
effectively utilising the resources so that firm can also save for future generation. This will
support company in establishing their market share in Germany. It can also help in increasing
their profitability aspects. It can help company in growing. They must also maintain that no
pollution is being created in German country because of the manufacturing process they are
growing through. It can affect profitability aspects of Burman and Son Ltd. company. It can
affect their growth aspects. It can also hinder them in expanding to Germany.
CONCLUSION
From the above study, it has been summarised that Burman and Sons Ltd company has been
engage in expanding their market share in Germany. Firm has been affected by the various laws,
rules and regulations that has been implemented by German government. Enterprise has also
been affected by the ageing population as they are unable to understand the new technology in
steering gears which has been brought up by company. It has hindered the growth of
organization while expanding their market in new areas of Germany. It has also been analysed
that company can also get affected because of the recession which is being going in Germany.

REFERENCES
Books and Journals
Adekola, A. and Sergi, B.S., 2016. Global business management: A cross-cultural perspective.
Routledge.
Doh, J., McGuire, S. and Ozaki, T., 2015. The Journal of World Business Special Issue: Global
governance and international nonmarket strategies: Introduction to the special
issue. Journal of World Business.50(2).pp.256-261.
Hamilton, L. and Webster, P., 2018. The international business environment. Oxford University
Press.
Kasemsap, K., 2018. Mastering business process management and business intelligence in global
business. In Global Business Expansion: Concepts, Methodologies, Tools, and
Applications (pp. 76-96). IGI Global.
Lewis, H. and et.al., 2017. Design+ environment: a global guide to designing greener goods.
Routledge.
Perry-Kessaris, A., 2016. Global Business, Local Law: the Indian legal system as a communal
resource in foreign investment relations. Routledge.
Pikhart, M., 2017. Managerial communication and its changes in the global intercultural business
world. In SHS Web of Conferences (Vol. 37, p. 01013). EDP Sciences.
Salvatore, D., 2015. Managerial economics in a global economy. OUP Catalogue.
Tallman, S., Luo, Y. and Buckley, P.J., 2018. Business models in global competition. Global
Strategy Journal.8(4).pp.517-535.

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