International Business Report: MH Dairies' Expansion in Chinese Market

This report provides an executive summary of MH Dairies' international business strategy, focusing on its expansion into the Chinese market. It outlines key business drivers such as finance, production units, technology, location, and cost considerations. The report delves into the external environmental analysis of the Chinese market, utilizing a PESTLE analysis to identify political, economic, social, technological, legal, and environmental factors. It also examines trade barriers and ethical/social issues relevant to entering the Chinese market, along with cultural preferences. Furthermore, the report explores various expansion methods that MH Dairies could employ to effectively operate in China. The report provides an overview of international business, the challenges and opportunities in the Chinese market for the dairy sector, and strategic recommendations for successful market entry and operation. It covers the company's expansion, trade barriers, ethical considerations, cultural preferences, and potential expansion methods, concluding with recommendations for MH Dairies' international business strategy.

International Business
EXECUTIVE SUMMARY
This report is based on international business that deals in running business practices
across global boundaries. As this project outlines international business practices of MH dairies
which is a London based SME that deals in delivering milk as well as dairy products. As for
carrying out business operations in Chinese market this report determines where various business

drivers which are implemented by company for having their expansion in Chinese market. Along
with that external environmental analysis for determining China's opportunity and threats is
performed and for that PESTLE analysis is performed along with identifying various trade
barriers and ethical or social considerations which are to be taken into consideration for entering
into China’s market. There is explanation of different expansion methods that could be used by
company in order to run their business practices effectively in China.

Table of Contents
Contents
EXECUTIVE SUMMARY.............................................................................................................1
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Business drivers.........................................................................................................................1
Trade barriers...........................................................................................................................6
Ethical as well as social issues that are to be considered.......................................................8
Cultural preferences.................................................................................................................9
Expansion methods...................................................................................................................9
CONCLUSION..............................................................................................................................10
RECOMMENDATIONS...............................................................................................................11
REFERENCES..............................................................................................................................13

INTRODUCTION
International business could be defined as dealing and trading of services and product across
global limits with a transitional scale.it generally involves cross border transactions and activities
of product as well as services in various countries. International business is also being define as
globalisation. It basically consists of various commercial activities that carry for promoting
transferring of product or services across global boundaries. analysis of international business
involves understanding of effects that have various activities with foreign and domestic market
in various countries (Perskaya, 2019). This report is based on international business in carrying
out UHT business in Chinese market of MH diaries which is London-based SME company
which delivers fresh milk, dairy products as well as varieties of various other products of milk.
Company is having proud on them self on providing reliability as well as providing delivery
drivers with more than 20 years. Along with company is selling different categories of milk
products in terms of ice cream, kulfi, paneer, buttermilk as so on. This report includes different
business drivers, trade barriers, ethical as well as social issues which are to be considered,
cultural preferences, pension methods used by company along with its conclusion.
MAIN BODY
Business drivers
Business drivers are set to be key inputs as well as activity which drive operational as well as
financial results of company. There are various instances of business drivers that relates in sales
persons, traffic of website, numbers, action unit, costs a product sold and so on. In terms of MH
dairies as company wants to expand their business practices in China’s market there are certain
rules and regulations which are very strict along with restricted carrying out any business that
wants to carry in their country (Kauko, Takala and Rinne, 2018). There are some key business
drivers that leads company in carrying out their business practices in China's market which are as
follows:
 Finance: As for having expansion in their business company is needed to have good
number of capital for investing in China's market so that they could carry their business
practices in and easily manner. MH dairies can take loans from their own country in order
to carry out their business practices in China.
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 Units of production: As company requires to have a focus on demands of their customers
in market as well as produce products according to customer’s demand so that there will
be no shortages as well as wastage of food and company will be able to save their money.
 Technology: As it is essential element for carrying out business practices in different
countries as in present scenario technology plays avoid role in having business growth in
different countries. there are various digital platforms that are totally related on
technology as well as digital channels which provide help in in reaching out maximum
amount of customers (Perskaya, 2019). As in digital platforms there are less number of
applications as well as web sites that are used in China’s market. As country is not
allowing other applications for carrying their business practices. MS dairy requires to
adopt their applications in order to build a wide reach of customers as well as selling their
products in an effective manner for carrying out business practices in Chinese market.
 Location: In order to carry business practices in an effective manner they should be e
right as well as attractive location which is chosen for establishing factories of company.
In terms of MH dairies company requires to have a focus on finding out various well
known location in order to make their products available to customers within their reach
so that more customers could be able to avail their products.
 Cost of product as well as service: As in order to carry out UHT milk business this
business driver is considered to be an essential element in carrying out business in a wide
manner that could reduce competition around markets. In terms of MS dairies, company
at starting stage required to plan and fix low cost in order to promote their products in an
effective manner so that more customers could be attracted for availing their products. As
customers pay a lot of attention on price of products in terms of purchasing.
 Availing products from different applications: This business drivers is responsible for or
letting customer purchase their products through online mode by their applications
(Kauko, Takala and Rinne, 2018). As in terms of MH Dairies with this company could
sell their products in large number along with their will be able to build a wide reach in
market place of China.
 Website traffic: As in order to track website traffic this business driver is considered as
most important element in order to track rate of reaching in market so that company
could be able to get an understanding of customers are liking their dairy products or not.
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Along with that in order to identify China's market in terms of UHT milk and dairy
cooperative business it is necessary for company to identify their surroundings in terms of
outside factors so that they would be able to carry and enter in their markets (Cohen, 2020). In
order to determine external factors of China's market PESTEL analysis could be performed. In
terms of MH dairies, analysis of company in terms of China's market follows:
Political factors  Company it could have risk of military invasion
market of China by identifying by political
conditions of country.
 There are different industrial security and safety
regulations in terms of food, dairy products, tobacco
sector as well as bridges industries.
 MH dairies is having product labelling as well as
other requirements in food sector of market of China
with carrying out UHT milk businesses.
 There is political stability as well as importance of
food, beverages, dairy products and tobacco sector
industries in China's market.
 There various pricing factors regulations in which
pricing regulatory mechanism could affect their
products in China's market (Mukherjee, Makarius
and Stevens, 2018).
 There are different tax rate as well as incentive
policies which are present in market of China.
Economic factors  According to (Chen, Li and Chen, 2021) Country is
having fortunately of economic growth for carrying
out UHT milk business and dairy companies.
 MH dairies is facing intervention or government it in
terms of free market and in terms of their milk dairy
products factors in market of China.
 There are different comparative merits of China
through host countries in relation with their UHT
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business of dairy products for carrying out their
cooperative business.
 China is having high skill level of workforce for
carrying out their milk as well as dairy industries
towards MH dairies.
 There is various business cycle stage in market of
China that consist of prosperity, recovery as well as
recession.
 There is high quality infrastructure for carrying out
UHT milk business in terms of dairy industry.
 There are different labour costs and productivity in
China's economy for carrying out dairy sector
businesses.
Social factors  Company code face different leisure interest.
 MH dairies is facing face various demographics
along with skill levels of population of China in
carrying out cooperative markets business.
 Company is providing different category of culture in
in China’s market for performing their milk as well
as dairy products that could lead to have gender roles
and social conventions.
 There are different entrepreneurial spirit and broader
feature of society which encourages company UHT
milk business for carrying out in China's market.
 There are hierarchy, power structure along with class
structure in society of market of China (Liu, Tjosvold
and Wong, 2020).
Technological factors  MH dairies good face different it impacts of
technology e on their products in terms of offering of
dairy and milk products in UHT businesses.
 There is higher rate of diffusion of technology that is
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faced by company in market of China for performing
their cooperative business smoothly.
 There is different technological development which
are present in China’s market for carrying out their
daily corporation business in their country along with
limited competitors (He and Guo, 2018).
 MH dairies could face and impact of cost structure in
their carrying out of milk and dairy company of
China market.
 There is an impact on value chain structure which is
carried in performing dairy sector business.
Legal factors  Company could face discrimination of law in market
of China for performing their milk and dairy business
through UHT business sector in market of China.
 Government of China is focused on having health as
well as safety law in carrying out UHT milk business
through dairy sectors in their country.
 There are different antitrust law which is established
in terms of beverage, dairy sector as well as food in
market of China.
 Company could face discrimination law in their
market for performing out dairy business services in
terms of milk and dairy products.
 As China's government is having employment law
for carrying out various benefits towards dairy
farmers in performing milk business for providing
milk to younger generation between 3 to 11 years.
 There are different commerce regulation as well as
customer protection laws in market of China for
performing businesses in an effective manner.
Environmental  Company could face a challenge of climatic change
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factors in terms of storing their milk products on constant
basis.
 There is waste management rule which could be
performed in China’s market in terms of carrying out
dairy business in their country.
 Market of China supports in having recycling of tetra
packs of their milk for carrying out sustainable
environment (Tobin and Volz, 2018).
 MH dairies could face weather change conditions in
performing their business practices in terms of UHT
business in their country as due to weather changed
conditions supply of resources could be affected.
 Company could face different attitudes in terms of
business along with supporting renewable energy for
performing their milk and dairy business in China.
 There are different loss data regarding to
environmental pollution in China's market in terms of
establishment factories.
 There are different endangered species with air as
well as water pollution regulations for performing
there dairy farm sectors.
Trade barriers
As by rising effectiveness and competitiveness in economy of China there are different trade
policies which are carried in country for performing business operations. As in order for that
country is using different trade policy of liberalisation in their country which reduces import
mandatory plans, licences, tariff rates as well as import quarters in market of China. In order to
perform international business operations smoothly there are different trade barriers which
occurs and harms business practices (Cho, Bonn and Li, 2019). In terms of MH dairies different
trade barriers that could be faced by company in carrying out business practices in market of
China are as follows:
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 Customs or clearances: As there is relevance of rules along with clearances in countries
that carries regulatory requirements such as custom clearances. As company who is
performing their business practices in China have to make sure that they should clear its
customs along with clearances in association with documentations as well as licences for
performing milk business as their practices. In relation with MH dairies it is necessary for
company to have specific clearance in terms of documentation, licences as well as
verification for performing their business practices in their country for selling their dairy
products in UHT business from having any conflict.
 Labelling as well as packaging: As China is having operation of labelling along with
packaging requirements which is essential for businesses to have an understanding of
carrying out business practices in a smooth manner in market of China. Companies
product which do not fulfil labelling along with packaging requirements are rejected for
entering into markets of China (Zuo and Huang, 2018). As in terms of MH dairies
company should make sure that their dairy products should be well packaged as well as
labelled so that they could be capable carrying out their business practices in Chinese
market.
 Government regulations: As prior performing business trade in market of China it is
essential for company to check that various government regulations in association with
law for performing business practices are to be followed in a legal manner. There are
different New government regulations which clearly defined businesses which are to be
classified in operators, online sellers as well as third party on platforms. In relation with
MH dairies company could pet trade barrier of government regulations for performing
out their UHT milk businesses as China government keeps on changing their regulation
on continuous basis.
 Communication barriers: This trade barrier is considered to be ab area in operating
international business operations in in market of China. It is related with making
customer relations for performing their business operations which is important for a
company to have a proper communication among them so that it their products as well as
idea should be promoted in a very effective manner. In relation with MH dairies company
requires to check that there should be no communication barrier which could be arise in
market in terms of understanding their requirements of customers as well as language.
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 Tariff barriers: As it consists of barriers of imposed restrictions that could be charged on
company’s products as well as services in order to supply them in Chinese markets. As in
order to enter in Chinese markets there are various taxes, fees as well as custom duties
which are to be paid by companies in order to perform their business practices. In terms
of MH dairies company is has to face different trade barriers in terms of quatos as well as
other taxes in terms of carrying out business practices in China.
Ethical as well as social issues that are to be considered
Corporate social responsibility:
As these activities are to be performed by companies in order to create their brand
awareness in minds of customers. Corporate social responsibility is performed when company
deals in having ethical and sustainable manner with having a dealing of social impacts as well as
environmental. It generally States to have careful consideration of community environment,
society as well as human rights that it deals. As performing out social responsibility along with
ethical operations are said to be essential for having success of company as it enhances public
image in markets. In terms of MH dairies, it is essential for company to carry corporate social
responsibility activities in market of China for performing out their UHT business smoothly
(Ngundu and Ngepah, 2019). By performing corporate social responsibility activities, it provides
help to company in enhancing their brand awareness and recognition in milk and dairy sector.
These ethical operations help company in enhancing their customer engagement for buying their
dairy products in a more effective way. In order to carry out corporate social responsibility
activities MH dairies will be capable to have hire employee engagement in market of China so
that they could perform their business efficiently in Chinese economy.
Ethics:
As when is a business carrying out their business practices internationally it should be
essential for companies to understand their vision, goals, as well as strategies which could take
into account for having legal along with having legal issues in international business. When
companies plan their long-term expansion method in market of China they should be able to
handle on various serious moral along with ethical issues and decision making for carrying out
their business practices effectively in China. There are different ethical issues in international
business of countries market that consist of working standards, conditions, outsourcing, equal
opportunity as well as the workplace diversity. There is also ethical consideration which should
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be taken for having supervisory oversight in terms of environment, corruption, human Rights as
well as bribery (Ji and Zhang, 2019). So it is essential for MH dairies to check that their business
operations are to be dealt with whole comply with Federal and data safety regulations through
environmental laws in China. As cultural federation could also be able to break or make
companies carrying out business practices. So it is necessary for company to examine various
aspects on continuous basis so that business activities could be performed in an effective way. As
ethics as well as corporate social responsibility is essential to be performed by company in order
to make their brand awareness in Chinese markets along with it helps in creating out different
operations easily in terms of performing international trade practices.
Cultural preferences
As cultural is defined to meaning of shapes, iconic characteristics as well as colours that
creates significance in various cultural importance. As these differences are to be considered in
order to identify whether company’s products are appropriate for market or could be able to
adapt business conditions or not. As performing international business practices in China there
are different cultural factors that are to be determined along with followed for performing
business operations in a smooth manner. As there are various cultural aspects that are to be
determined for having effective business practices (Lee, Hong and Makino,2020). In terms of
MH dairies few of cultural aspect that are used by company for operating their business and
dairy UHT operations are as follows:
 Giving gifts: As China's market are considered to be gift givers. As gift Express their
friendship as well as it generally indicates hope for having good future business
operations. Therefore, it is not important to present gift in absence of a good reason. In
terms of MH dairies in order to perform their business practices in China company should
check that their UHT business should outcomes in providing give to market of China as
well as their customers for performing out their business effectively (Russell and Linsky,
2020).
 Meetings or greeting: As in order to carry out business operations in in China's foreigner
businessman should be able to present their sincerity along with respect true hand
shaking with each another. It is important for China to receive cards through both hands
as well as read it. In terms of MH dairies, it is important for company to check that they
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