Analysis of Yummy Food's Global Business Environment for UK Expansion

This report analyzes the global business environment of Yummy Food Limited, a fast-food chain in Hong Kong, focusing on its potential expansion into the UK market. The analysis begins with an introduction to globalization and its driving factors, including economic, political, financial, and social influences. A PESTEL analysis of the UK market is conducted to assess the political, economic, social, technological, environmental, and legal factors impacting the business. The report then delves into the complexities of supply chain management in an international context, highlighting challenges related to trends, customer accommodation, and globalization. Opportunities and challenges associated with globalization are discussed, followed by recommendations for Yummy Food Limited to overcome these challenges, including the application of the McKinsey 7's model and Hofstede's dimensions of culture. The report examines factors influenced by global operations and suggests strategic expansion routes. The report concludes with a focus on the importance of proper management and decision-making in a global business context, emphasizing the potential for increased profitability and the need to adapt to the specific cultural and economic conditions of the UK market.

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Global Business Environment

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Contents
Introduction......................................................................................................................................3
Driving Factors of Globalization.....................................................................................................4
PESTEL analysis of the organization..............................................................................................5
Complexities of supply chain management.....................................................................................7
Opportunities and Challenges of globalization................................................................................8
Recommendations to overcome challenges...................................................................................10
McKinsey 7’s model......................................................................................................................11
Hofstede dimensions of culture.....................................................................................................12
Factors that influenced by the global operations...........................................................................13
Strategic expansion that routes the organization...........................................................................14
References......................................................................................................................................15

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Introduction
The globalization concept is essential for managing the business environment and it increases the
overall scale of the business. This proposal includes the analysis of the globalization and the
advantages of globalization in the business environment. Yummy food Limited is a fast-food
chain store in Hong Kong. The company needs to expand its business in the UK country. As
globalization defines the several changes in all over the world where the company expand its
business in other countries. The globalization of business makes several changes in the business
that required to operate in multiple countries. The assessment will be discussed about the several
challenges and opportunities comes in the global business. The advice required by the CEO of
Yummy food Limited to manage the expansion of the business in the UK market. The various
factors related to the globalization will be discussed in this proposal (Cuervo-Cazurra, 2011).
The various aspects of business like supply chain management, the effect of culture and strategic
expansion of routes in the organization will also be described in this proposal that helps in the
proper management of the business. The decision making is also involved in the proper
management of the global business as the global business needs proper management in a
different country. Yummy food Limited needs proper management to expand the business in the
global market. The global business environment improves the profits of the organization. This
concept greatly influenced the overall process of the company and makes the expansion easier
(Salvatore, 2015). The proposal includes several recommendations that help in overcoming the
challenges occurred in the global business environment. In the global business, several external
forces include the firms and impact all the decisions and operations of the organization. This
proposal includes all the aspects related to the globalization and this improves the business
process in the global environment.

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Driving Factors of Globalization
The shape and pace of globalization are driven by several factors. The globalization includes
several factors that are adopted by the global business and by using these factors the expansion
of the business becomes easier and this improves the overall environment of global business. The
main factors include in the globalization are economic factors, political factors, financial factors
and social factors (Wood, et al., 2015). These factors improve the overall process of
globalization.
Globalization of market: Globalization market is the synergetic term which helps the
companies in evaluating the external market and to integrate with the culture tool. The goods and
services can be easily sold through the market globalization and helps in promoting the things.
The process of merging and integrating the market into a single market through the distinct
world market is globalization of market.
Globalization of production: The manufacturing facilities of every country are different so the
factors which influence the manufacturing or the production are the basic globalization of
production. In foreign countries the manufacturing production is less costly, raw material are of
high quality and input are available at the lower cost.
Yummy Food Limited needs to expand its business in the UK so it is important to analyse these
factors relate to the UK market. The economic and political factors of UK market matters in
expanding the business in the UK. The driving factors of globalization are discussed below-
 Economic Factors
The economic factors are one of the main driving factors in globalization as it is
important to know the economic conditions of the country in which the business is
expanded (Savrul, et al., 2014). The economic factors include lower trade and investment
barriers. The economic conditions of the UK need to be analyzed by the economic factors
of globalization.
 Political Factors
The political factors are also important in the globalization as politics create barriers in
the global business and create instability in the business. Political factors include the
government policies of the country related to the business process. Government policies

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create many hurdles in expanding business in the UK market. As the UK government
made several policies related to the global business.
 Technological Factors
Technology plays an important role in the process of globalization. The technology
involves a major factor in the process of globalization. Technology improves the overall
process of globalization. The food stores used the technology in managing the supply
chains in the market. The technological factors improve the global business in the
international market.
As a consultant, it is proposed that apart from the above factors, there are several other factors
that are used in the globalization. Like the social factors are also included as one of the main
driving factors in globalization. The knowledge of the society of a particular country in which
the business expands is important as these factors are used to increase homogeneity across all
over the world (Okora, 2012). The organization needs to consider all these factors for managing
its global business in the international environment. These factors provide several benefits to the
food store in their expansion.
PESTEL analysis of the organization
PESTEL analysis is used to analyze the macro-environment concepts for the expansion of the
business. The company expands its business in the UK market so it is important to analyse the
macro-environment factors related to the UK. The pestle analysis of UK is discussed below-
 Political factors of UK
The UK market is impacted by several political factors. As the government of the UK
made several rules and regulations regarding the business process in the international
market. The political stability of the country improves the expansion of the business and
increasing the profits of the business. UK country makes good relations with other
countries so this is a good sign for the growth of the company that expands in the UK
market (Sorensen, 2012). The government policies are also as per the international
business.
 Economic factors of UK

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There are several economic factors that affected the expansion of the business in the
international market of UK. UK has the 5th largest economy in the world as per nominal
GDP. Nowadays, the UK becomes a famous country for FDI (Foreign Direct
Investment). Yummy food limited expand their business in the UK due to the better
economic factors of the specific country.
 Social Factors of UK
The organization have a lot of opportunities in the UK as the UK has a big consumer
market. The social class of the UK is also good as the company achieves better profits in
expanding the business in the society of the UK. The population of the UK is
multicultural so the company need to provide a variety of products so that customers get
attracted towards the organizational products.
 Technological Factors of UK
Technology also matters in the growth of the business that expands in the foreign market.
Yummy food limited expands its business in the UK so they need to be followed some
advance technologies to achieve better growth in the market. As the UK is one of the
most technologically advanced countries in the world. The business in the UK is
developing by using proper technologies to improve the products and services delivered
to the customers.
 Environmental Factors of UK
The environment is also affecting business companies in the UK. The economic activities
of the UK impact on the business environment. Nowadays, the UK made significant
improvements by decreasing the negative impact of the environment. The government
needs to create awareness among people regarding environmental issues. The UK
sometimes faces several challenges in the weather conditions so the business analyzed the
proper environmental conditions before expanding the business.
 Legal Factors of UK
The legal landscape is also important for the expansion of business in the UK. There are
several laws that implement in the business environment of the UK. As these legal factors
also affecting the companies of other countries to expand their business. But the laws
implemented in the UK needs to manage the overall process of international companies.

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Yummy Food Limited expand their business and adopt the legal system of the UK in
their business.
As per the above pestle analysis, it is proposed that Yummy Food limited needs to analyse these
factors before expanding the business in the UK international market (Simic and Dimitrijevic,
2012). As these factors are essential for the expansion of the business. It is consulted that the
company need to take care of these factors to achieve better growth in the foreign market of the
UK.

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Complexities of supply chain management
The international market needs to face several complexities and challenges in some of the
process of the business. As per the analysis, it has been analyzed that the supply chain
management of Yummy food faces several complexities that affect the overall business process
in a large manner (Levent, 2016). Yummy food needs to maintain the supply chain for expand
the business in UK as this is the main aspect of the business. The supply chain management is
one of the main departments of an organization without these the supply of the products is not
possible. As the international trade environment of business faces a lot of challenges in the
process of supply chain management. There are several complexities faced by the international
business which are discussed below-
 Trends in Supply chain
The several issues of the supply chain itself create complexities in the process of the
supply chain of the Yummy food. Yummy Food restaurant implements several different
trends to improve the supply management in the global market. All the times, the outside
sources are not responsible for creating the complexities in the supply chain. These
complexities affect the works of the business. The decisions are taken by the Yummy
food regarding the division impact the process of supply chain management (Hirst, et al.,
2015). The omnichannel deliveries also impact the process of supply chain management
and create problems in the proper delivery of products. The other complexity in the
supply chain is that most of the organizations need specialized suppliers which are
restricted in the Yummy food restaurant and several other businesses.
 Customer Accommodation
To achieve the needs and demands of the customer is also the biggest challenge faced by
the supply chain management of the Yummy food. The customers need their products at
the proper time and also want their choices to need to be delivered. So, this process
creates several complexities in the process of supply chain management. The customer
accommodation is important for Yummy food as the taste of the UK people are different

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from other countries so they need to maintain the taste of the customers. Yummy food
maintains the overall process of the customers.
 Globalization
The supply chain process faces more complexity while the process of globalizing. The
supply chain faces problems in the transportation process in the globalization business.
(Li and Du, 2016). The legal and regulatory issues of globalization also create several
complexities in the business of Yummy food. The globalization is the process to shift
towards the interdependent economy. There is a difference among the globalization of
markets and globalization of production. In the globalization of markets, various different
national markets are combined like German market and American market. In the
globalization of markets several advantages are occurred like falling of trade barriers
easier to sell globally. By the globalization, the promotion of firms become easier.
Yummy food also gets more profits by expanded globally. The several firms get several
benefits by the globalization. The globalization of production is also important in the
global aspect as this is also important for the overall process of business. By the
globalization of production, firms source goods and services across the globe o the
capitalize the differences related to cost and quality. By the globalization of production,
companies improve the quality and \functions of product offering.
As per the above analysis, it is proposed that the Yummy Food limited need to manage the
complexities occurs in the supply chain management then they decide to expand the business in
the international market (Langhans, et al., 2013). All the issues of supply chain affect the global
business and its environment. The organization manage the complexities occurs in supply chain
management.

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Opportunities and Challenges of globalization
The global business provides several challenges and opportunities. Yummy food needs to expand
its business in the UK international market so the global business faces several opportunities and
challenges. Globalization defines that the several countries that interconnected with each other
for the business or any other process (Mitkus and Nedzinskaite-Mitke, 2016). The global
business has several opportunities and challenges. The main opportunities of Globalization are
described below-
 Reducing time and distance barriers
This is one of the important and best opportunities that used in the overall process of the
global business. As by this opportunity, companies reach new markets in an effective and
quick manner than in the past (Desai, 2013). International customers help companies to
gain more profits and reach the highest level of business.
 Securing data and complying with regulations
The several regulations and requirements are getting secured in the overall process of the
business (Bondar, et al., 2015). The globalization makes the data secure and makes
proper compliance with regulations. The overall security posture gets increased with the
use of the globalization concept in the business.
 Attracting and retaining the best talent
The other main opportunity is to expand the talent pools beyond the local area.
Specialized talent gets increased by adopting the globalization process. The overall
growth of the organization gets improved with the use of globalization (Turner and
Holton, 2015). The best talent can be easily identified by the use of global business.
Along with the opportunities, the challenges are also analyzed in the globalization process. The
main challenges of the organization are discussed below-
 Structure of the organization
By adopting the globalization practices, the overall structure of the organization gets
changed and affect the overall work of the organization. By the changing process in

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structure, the employees get confused and affect the quality of work. The globalization
requires the development of various strategies and these strategies make several changes
in the organizational structure.
 Ethical business practices
The business has several ethical practices that make the runs business in an easier way.
The ethics are an important part of the business. National and international business gets
affected by the globalization process. The ethical challenges occurred in the several
business practices affect the overall process of the business as the ethical challenges
affect the employee motivation and create confusion among the employees. Yummy food
faces several challenges in expanding the business operations to UK. The ethical
challenges faced by business are related to the accounting process, serving issues,
employees drinking on the job and patrons allowed to get out of control. These challenges
occurred in Yummy food so the business need to manage these challenges by taking
several decisions in the business. So, the business planning includes the several ethics
that needs to be maintained for achieving proper objectives in the market.
 Public Relations
All the public relations get affected in the business by adopting the several concepts of
globalization. Public image and branding are critical components of the business and they
get affected by the globalization.
By analyzing the challenges and opportunities occurred by globalization, it is proposed
that along with these opportunities and challenges, the several other opportunities and
challenges are also arising that mainly related with the concept of globalization (Beneria,
et al., 2015). The other opportunities are like it maintains the profitability of the business,
increases the productivity of the business and many more. The other proposed challenges
of globalization are that it decreases the motivation among employees and affect the
overall quality of business.

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Recommendations to overcome challenges
Yummy food expands its business in the UK market so they face several challenges in the
process of globalization. The global business environment faces several challenges in the overall
process of the business. It is important for the organization to overcome the challenges so the
business expansion becomes proper and achieve more profits in the UK market. The several
recommendations used to overcome the challenges are discussed below-
 The main globalization challenge is that it affects the overall structure of the organization
so the organization need to overcome this challenge by making employees familiar
towards the business structure and inform them before making several changes in the
business. The overcoming of the globalization challenge improves the working process of
the organization. By the familiar process of the employees, all the aspects of the
globalization as well as structure of the organization gets improved. This also makes the
proper structure of the business.
 The other challenge in globalization is related to the ethical practices occurred in the
business. Business ethics are essential for the proper management of the business. The
management of ethics is possible by the proper management of the global practices so
that it improves the different aspects of the business (Nilsson and Gustafsson, 2012). The
ethics are too important in the business as these ethics are too important in the business
and all of the ethics need to maintain in the global practices of the business. The ethics
maintained by the business by implementing several rules and regulations of the business.
The ethics managed by using the laws and legislation of the business so that employees
and stakeholders maintain the ethics in business. Yummy Food manages ethical practices
by using proper methods of rules and regulations. Business ethics and public relation are
maintained through adopting the global practices by analyzing the gap in quality process
data and to fill the gap by using the tool of Gap analysis Tool.
 The other important challenge occurred in globalization relates to the relations among the
public of the business. The public relations need to become important in the global
business. The public relations need to become proper so that the globalization maintains
all the relations in the business (Pinto Dias, 2013). The organization need to use the

Management 13
proper strategic communication to maintain the public relations in the global business.
The proper communication management builds the strong public relations in the global
society. The relations become proper by maintaining proper communication in the
business. The relations become better by adopting several strategies of communication.
The relation can be maintained by interacting with them or to communicate with them on
the specific period of time so that global business can be expanding. If it is not possible to
interact then conference meetings or communication should be built up.
 The challenges occurred in Yummy food are also managed by using the Mc Kinsey 7s
model and Hofstede cultural dimension model. McKinsey 7s model helps the company to
manage the structure of the business as per the needs of the global business and applied
new strategy in the business. This model provides several benefits to the business. As this
model make the system as per the global business and improves the overall shared values
of the business. This is one of the best recommendations used to manage the
globalization in Yummy food.
 The other important model used to manage the challenges occurred in globalization is
Hofstede cultural dimension model that defines the cultural differences among Hong-
Kong and UK as the Yummy food needs ot expand the business in UK. By knowing
these differences, the business feels easier to expand the business and achieve several
benefits in the global business.

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McKinsey 7’s model
The structure, culture and governance of the organization matter a lot in the overall process of
globalization. Yummy Food limited structure is related to the fast-food store chain and the
structure manages as per the products related to the fast food. The culture of the organization
needs to maintain so that the activities and functions are made as per the culture of the
organization (Ndhlovu, 2012). The governance of the organization is a system by which an
organization makes the decisions as per the objectives. The performance objectives achieved by
the organization by using all these three aspects. It is proposed that the organization need to
achieve performance objectives by using governance in the business.
By using the McKinsey model, the organization achieve all the goals in an easy manner. This
model helps to determine how the different parts of the organization work together. Yummy
Food limited adopted this model to improve the globalization process. The McKinsey model
includes seven aspects that are discussed below-
 Strategy
The strategy includes the plan of the organization for managing the competitive
advantage for the major competitors of the organization. Yummy Food limited adopted a
competitive advantage to compete with the other organizations in the global market. The
company needs to implement cost differentiation business competitive strategy with an
objective to improve the profitability in the company. This type of strategy would help
the organization differentiate their brand in the market in front of other competitors
present in the industry. Cost differentiation strategy would also help the organization to
place them in the right position in the market and help the customers to understand brand
image that the company wants to create.
 Structure
This aspect includes how your company is organized. The overall structure of the
organization is included in this aspect (Stahl and Tung, 2015). Yummy food limited
needs to maintain the structure of the organization to attract consumers. The company
makes a new structure to get the better profits in the business. The company follows the
various models to get the success in the global business environment. Yummy food
follows the subsidiary model to get success in the global business. The company

Management 15
maintains the product division as per the requirements, area division as per the
consumers, follows the matrix structure and proper functional structure to get the
business profits in the global environment. Therefore, it should be noted that the
company should make use of functional organizational structure to organize the strategies
of Yummy Food. This type of structure would help the organization to increase business
efficiencies in specializing in different departments (decentralize) while centralize the
functions at the end so as to provide better output to the customers.
 Systems
The daily activities and functions used by the staff are included in this process. Yummy
food limited uses the system aspect for managing daily activities. Yummy food needs to
maintain the system for the betterment of the business. Yummy food use new system in
the global business to manage all the functions of the organization. The new system helps
in managing several processes of the business. New online cloud software would help the
organization to effectively organize different functions of different branches and let the
organization to expand in new market without struggling. Online system would help in
preparing a mind map and implement actions accordingly for the UK environment.
 Shared Values
The core values of the business include shared values. The corporate culture and ethic
include in these shared values. Yummy food limited includes the shared values to achieve
the required goals of the organization. Shared Values are also important in the
globalization of the business as these values improve the overall structure of the business
and maintain ethical environment in the business. All the shared values are different for
the different market. As in UK market, the shared values behave in a different manner
and this increases the overall aspects of the business. By improving the shared values,
Yummy food manages all the aspects of the business in the global environment and
manage all the strategies related to the global business.
 Style
The style that is adopted by the system of the organization. Yummy food limited adopted
the leadership style in the business. The style of the business is also different in different
market. So, the company should make use of situational leadership in the business
environment of UK so as to help business settle in new setup. This type of leadership

Management 16
strategy would help the organization to analyze the environment in which the company is
going to enter and then perform leadership strategies accordingly.

Management 17
 Staff
The staff of the organization includes in this aspect. The employees and general
capabilities are included in the Yummy food Limited. Yummy food limited needs to
manage their staff properly in the global business environment. The staff is a major
strength of any organization which increase or decrease the overall concepts of the
organization. The proper training is required by the staff for managing the global business
environment.
 Skills
The skills of the employees will be included in this aspect. As the employees of Yummy
Food Limited have different skills as per the requirements of the business. The company
needs to implement cross-cultural training for the employees so as to make them
understand the UK culture and let them work accordingly. These skills would help the
organization to let the employees understand the behavior of the customers in new market
and then offer them services accordingly.

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Hofstede dimensions of culture
This aspect includes the different dimensions of the culture that impact the overall process of the
organization. These dimensions are too effective in the overall growth of the organization. Cross-
cultural communication is used in this process. The global business includes the cross-cultural
communication theory in the overall process (Lo, et al., 2017). The several dimensions are used
in different functions and activities of the business. The organization that is Yummy Food
Limited already achieved success in the market of Hong Kong and now the company needs to
expand the business in the UK. So, a comparison of dimensions is discussed in this section. The
different dimensions are discussed below-
 Power Distance
This is related to the members of the organization which defines that at what extent
members are less powerful in society. The distribution of power is unequal in both
aspects. The power distance of Hong Kong is higher as compared to the United Kingdom.
As Hong Kong achieves 68 points and UK achieves 35 points in the process. Due to this
difference among UK and Hong Kong, the leadership style gets affected which is
essential for the overall process of the society. The leadership style needs to be effective
in the organization of the particular country and this affect the overall process as without
leadership no business can sustain in the business market. The leadership improves the
several aspects of the business and it provides several benefits to the business. To manage
these differences, the organization need to create open forums with equal participation for
project feedback. The organization need to develop interactive systems by networks of
cross functional teams that drive high levels of collaboration and needs to encourage and
enable communication channels. The leadership also get improved by these aspects.
 Individualism versus Collectivism
This aspect relates to the preference of people that they need to left alone for themselves
or needs to remain in a close-knitted network (Ravanfar, 2015). This aspect is higher in
the United Kingdom and lowers in Hong Kong which affects the global business of the
organization. The UK includes 89 and Hongkong have 25 so this shows the big
difference among the UK and Hongkong as per the individualism and collectivism. For

Management 19
managing this difference, the several recommendations are used that related to the people
used in the process. The rights of the individual include in this process. To maintain this
difference, the organizations need to use the people management in their activities and
also implement the reward systems for the betterment of the employees. The maintenance
of individualism is necessary for the overall process of the business and it is considered
as value support of individualization. It is important to manage this context and use the
people management to manage the people in the business so activities become proper and
improves the management among employees.
 Masculinity versus Femininity
There is no such big difference among masculinity of Hong Kong and the UK. The
masculinity in Hong Kong is 57 and the masculinity in the UK is 66. Therefore, the
company needs to implement the practices that are concerned with economic benefits and
superiority feature for the customers of UK.
 Uncertainty Avoidance Index
This is lower in both the countries so it does not give proper effects on the domestic
business or global business. The number of uncertainty avoidance in Hong Kong is 29
and the number of uncertainty avoidance in the UK is 35. There is not a big difference
between both the countries so it does not give effects in the proper manner.
 Long Versus Short-term orientation
The long- term orientation needs to be higher in the process of the globalization and it is
higher in both the countries so both the countries are perfect in globalization (Gokdeniz,
et al., 2017). The number of long term orientation in Hong Kong is 61 and the number of
long term orientation in the UK is 51.
 Indulgence versus Restraint
There is a great difference in the indulgence process of both countries. The Hong Kong
number in indulgence is very low and this number in the UK is too high at 69. There is a
big difference in indulgence and restraint among the Hong Kong and UK. The UK is too
high as per the indulgence and Hong Kong is too low. Therefore, to manage these
differences the organization needs to follow several recommendations. The society
functions and activities are included in this process that manages several aspects of the
business. The organization needs to use the proper marketing programs to manage all

Management 20
these aspects related to indulgence and restraint and also uses the process of the people
management for the betterment of the business. The indulgence related with the human
drives related to the society activities. It is important to implement recommendations for
managing the overall aspect of the indulgence. It all becomes possible for managing the
functions of the society and by using people management in the organization. This also
make the social norms proper in business.
Yummy food needs to cope up with the cultural differences among Hong Kong and UK. By
analyzing and maintaining the differences then only business gets success in UK. As power
distance is better in UK so it does not require any changes. But the differences in masculinity and
femininity affect the global practices of business so the business also needs to maintain their
business as per the dimension among masculinity and femininity in Hong Kong and UK. The
company also maintains their strategies as per the long term and short-term orientation. As the
indulgence versus restraint is high in UK as per the Hong Kong so the company needs to
maintain as per the cultural differences so that the global practices becomes proper. The
differences among these aspects of the culture needs proper recommendations to manage the
differences. The organization need to discuss all the aspects of the business. The organization
need to manage the overall organization aspects for managing the cultural differences in the
organization. The cultural differences occurred in the process of the global business and the
global aspects needs to consider by the employees for the better growth of the business. The
organization need to consider the Hofstede’s insights with an objective to manage the business
activities of the company in diverse environment. The marketing and other activities should
directly align with the interest of customers explained from the cultural index model. As both the
countries have many differences, so it is important to manage these differences in a proper
manner. Thus, it should be noted that use of the cultural model would support the functions of
the company in analyzing the differences between both the cultures and then significantly using
it to drive benefits for the organization in new environment of UK.

Management 21
The plan of managing multicultural management becomes easier and this manages all the
different cultures occurred in the business. The plan of multicultural management becomes easier
by adopting this model.

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Factors that influenced by the global operations
There are several factors that affect global operations in international business. All these
operations are majorly involved in international business. The main factors are described below-
 Social Factors
The social structures are changing in this factor. These factors affect global operations by
changing in behaviour, tastes and lifestyle patterns of the particular country.
 Legal Factors
The different laws and rules are also affected by global operations in international
business. The business needs to consider the definite rules and regulations that affect the
overall operations of the business.
 Economic Factors
The economy of the country is also considering as a major factor that affected the global
operations of the business (Gong, 2015). The global economy is one of the important
things in business. This increase several opportunities for achieving profits.
 Political Factors
This includes the various changes in the policies made by the government. Political
factors greatly influence the overall business operations (Lindholm, et al., 2017). The
overall regulations of the business are included in this process.

Management 23
Strategic expansion that routes the organization
It is proposed that the global business required the expansion strategy to define the routes of the
organization. The expansion strategy is adopted by the yummy food limited to expand the
business in the international market (Mediavilla, et al., 2015). The routes used in the expansion
define the various operations included in the global business. The several functions of the
business are included in the strategic expansion that involves the several strategies that expand
the business in a large manner (Turkulainen, et al., 2015). The customer functions, customer
groups and other alternatives are included in the different routes of the strategic expansion.
There are different routes included in the market that are exporting, licensing, joint venture and
wholly owned. All have various advantages as well as disadvantages. As these aspects have
various advantages that it increases the revenues in the business. It also helps in improving
profits to the business. Yummy Food needs to adopt these strategies to enter in the international
marketing as these methods makes the business easier. Among all the aspects, joint venture it the
best route for the business to enter in the international market. This makes the proper resources
and maintain the different activities used in the business. The company needs to follow the
different steps to use the joint venture in the global business.
Exporting (Advantages): The better margins can be attained by the company and can lead to
larger economies of scale. The market can be expanded and budget can be developed easily by
changing the existing product into the new market.
Exporting (Disadvantages): If the focus is not proper then the company can lose the existing
customers and the home market. To manage the remote relationships becomes difficult in this
route and the control has been loosed in the overseas market.
Licensing (Advantages): The passive income get increased through this route as by taking the
license, there is no risk of the ownership rights. New business opportunities are created for
companies after taking the license and the risk also get reduced. To entry in the foreign market
this is the best route as it develops the unique marketing approach.

Management 24
Licensing (Disadvantages): The theft of IP get increased with this route as the exposure is of
higher level. The company always gets dependent upon the licensor. The competition has
increased in the market through licensing so in market to target the people is difficult.
Franchising (Advantages): In franchising the market share is already established and the risk of
failure of the business is also low. By taking the franchising the company can use the trade mark
and can use their brand name. There is the good relationship with the suppliers and also have the
exclusive rights in the same territory.
Franchising (Disadvantages): The cost of franchising is higher and they also include certain
restrictions which affect the business. The profits earned by the company have to be shared with
the franchisor. The nature of franchisee is inflexible and they go out of the business.
Joint venture (Advantages): The expertise and new capacity can be gained and greater
resources can be accessed. Flexibility can be enables in this route as it shares the risk with the
venture partner.
Joint venture (Disadvantages): The tax arrangements get complexes and to build the good
relationship in this route takes many time and efforts. The integration and cooperation’s is also
poor and this route is quite costly for the companies.
For the company, Yummy Food the best route is the exporting the food as it helps in gaining
more market share and helps in attaining the more profit. The better margins can be attained by
the company and can lead to larger economies of scale by this way of route.

Management 25
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