International Business Report: Market Entry, Risks and Evolution

This report provides a comprehensive overview of international business, examining its evolution, the role of economic, financial, socio-cultural, and political forces, with a focus on the United Kingdom's major trading partners. It delves into the key elements influencing international firms, utilizing PESTLE analysis to assess the external environment. The report explores recent developments and patterns in international trade and investment, along with various market selection techniques and methods for entering international markets. It also covers risk minimization strategies and universally adopted theories to enhance workplace experience in international companies, using Tesco as a case study. The report concludes with a discussion of the implications and future trends in the field of international business.

International business

Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
LO1..................................................................................................................................................3
The evolution of different business practices in international business and role of different
economic, financial, socio-cultural and political forces with key focus on United Kingdom’s
major trading partner countries....................................................................................................3
LO2..................................................................................................................................................4
Different key elements present in international business environment that influence several
international firms........................................................................................................................4
LO3..................................................................................................................................................6
Recent development and patterns in the field of international trade and investment..................6
LO4..................................................................................................................................................7
Various techniques of market selection in international business...............................................7
LO5..................................................................................................................................................8
Various methods available to different companies to enter international market.......................8
LO6..................................................................................................................................................9
Techniques and tools of risk minimisation that is available to international companies............9
LO7................................................................................................................................................10
Different universally adopted theories and concepts to enhance workplace experience in
international company...............................................................................................................10
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
In the era of globalisation and technology international business is considered as major
economic activity which is helpful in providing effective goods and services in international
market (Amponsah, 2017). International business is considered as global business which
performs different tasks and activities related to economic transactions in international market.
This report covers different dimensions of international business along with focus on United
Kingdom’s major business partners. This report explains different methods of international
market entry used by different global companies to enter the global market. This report includes
PESTLE analysis which is helpful in determination of different environmental factors that are
related to international business environment. This report also includes different tools and
techniques that are available to companies in global market for performing risk minimisation. In
this report example of Tesco multinational company is take into consideration for understanding
different aspects and techniques of international business. Tesco is a British multinational
company which provides retail services in all over the world and was founded in 1919.
MAIN BODY
LO1
The evolution of different business practices in international business and role of different
economic, financial, socio-cultural and political forces with key focus on United
Kingdom’s major trading partner countries
International business practices have evolved in global business market since a long time.
Companies who have large amount of capital reserved perform investment in global market to
generate a good amount of revenue. After the introduction of globalisation many domestic
companies of United Kingdom started to invest in global market for increasing business
operations. Different political factors related to government also supported activities related to
international business for development of whole economy. The government of UK is always
supportive to different international companies which are functioning at the marketplace. The
businesses which operate in international market also take support of different financial theories
to develop economic operations (Anwar, 2018). United States is considered as a major partner
for UK to perform export related operations in a bulk quantity. The government of United
Kingdom has also facilitated different aspects of international business by introduction of

effective monetary policies. Monetary policy which is formulated by government of United
Kingdom is also helpful in increasing revenue and profitability of international companies. The
society of UK is always supportive to international companies as they are helpful in generating
employment opportunities for different people.
United Kingdom has always performed effective export and import related practices in global
market. The country has selected different business partner countries which are helpful for export
and import related operations (Bhagra, 2018). Government of UK is also coming up with
different plans and policies to promote trade among different countries. The UK’s major trading
partners in global business market are listed below:
 United states
 Germany
 Netherlands
 France
 China
 Ireland
 Spain
 Belgium
 Italy
LO2
Different key elements present in international business environment that influence several
international firms
The international market is dominated by different environmental factors that create a deep
effect on different transactions made by Tesco. In order to survive in international market it is
compulsory for a company to perform external environment analysis (Green, 2018). The
PESTLE analysis of Tesco is mentioned below to understand different environmental factors that
effect on operations of Tesco:
 Political factors- Tesco is influenced by different political factors that are present in
international business environment. There are several government related policies and
plans which are to be followed by Tesco in order to conduct legal operations at the

marketplace. In different countries where Tesco performs business operations the
political instability and instability of government also play a major role. The management
of Tesco always comply with different rules and regulations which are formulated by
government to perform legal business functions.
 Economic factors- Economic factors are considered as one of the major factors which
are effective in determination of functioning of international business. The monetary
policy which is formulated by government of different countries is also a major factor in
order to deal with several economic transactions in the business (Jansson, 2018). Gross
domestic product and national income of a country are two major factors which
determine functioning of a business at the marketplace. Tesco has hired professional
strategic management in order to deal with several economic factors that are present in
external business environment.
 Social factors- The main element of social factors in a business is known as culture
which determines different business operations. Culture of internal environment of a
business helps a business to grow at the marketplace in a precise manner. The human
resource management present at Tesco try to develop effective cultural management for
achievement of organisational goals and objectives.
 Technological factors- In today’s world technology is considered as one of the major
factor which is helpful in determination of different techniques used in a business. The
companies in international market are majorly influenced by different technology
oriented factors like computer system and software. Tesco has also hired professional and
skilled IT experts for dealing with several operations related to information and
technology.
 Legal factors- It is essential for a business in international market to follow different
rules and regulations that are developed by local authorities. The business organisations
at marketplace follow different factors related to legal environment for performing
smooth business operations. Tesco follows different legal policies in several countries to
perform legal operations at the marketplace. In the era of stiff competition between
different companies it is compulsory for a company to follow different legal trade
practices for survival at the marketplace.

 Environmental factors- In functioning of a business at the marketplace it is compulsory
to take care of environmental policies that are formulated by government. It is essential
for a company to comply with environmental policies that are formulated by government
to perform sustainable operations. Companies in international business environment
should take care of business environment in order to perform different trade practices.
LO3
Recent development and patterns in the field of international trade and investment
In international business recent changes after globalisation has caused a tremendous change
which is beneficial for the whole world (Kasemsap, 2020). Most of the successful international
companies follow different patterns of international trade and investment in order to compete at
the marketplace. The crucial patterns which are part of development in international business
environment are mentioned below:
 Information and technology- There is a significant change bought by major operations
related to information and technology in international business. Spread of fast internet
services all over the world has strengthened up different business related aspects at the
marketplace. Various companies which are operating in global business environment are
indulged in development of different operations for performing different activities and
tasks. Tesco has hired professional IT experts to deal with big data handling in order to
handle the data related to different customers.
 Trade partnership between different countries- There are different countries which
have formulated trade agreements with each other to promote trade and development. In
the trade related deal major countries offers different rules and regulations for promoting
trade. Also with presence of world trade organisation perform different exports and
imports related control. The world trade organisation is a major governing body which is
headquartered in United States to control different trade related practices.
 Cross border trade liberalisation- In international trade cross border trade between
different countries is promoted to achieve business targets. The transactions in business
related activities are promoted after introduction of cross border trade by governments of
different countries (Kasemsap, 2020). United Kingdom also performs trade related
practices with major countries which are nearby its geographical area. It is essential for a

country to promote cross border trade with different countries to achieve organisational
goals in a precise manner. Government of UK has also introduced several policies and
regulations for promoting international trade in country.
 Growth in emerging market- In international market there are major emerging markets
like China, Taiwan, South Korea and United States which promote trade in international
business. Due to the growth in emerging markets there is a tremendous increase in
facility related to effective products and services. China is considered as major emerging
market which provides cheap products and services to different customers in international
market. Major countries in global market perform trade practices with Chinese market in
order to increase business profitability and efficiency.
LO4
Various techniques of market selection in international business
It is compulsory for a company to choose appropriate market selection technique for
performing business operations. Major companies in international market hire professional
strategic management for choosing appropriate market for business operations (Keivanpour,
2017). The market selection is very much essential for a company to choose precise market for
business development. The major market selection tools and techniques available to different
international companies are listed below:
 Geocentric market selection- Geocentric market selection approach considers whole
world as economic market. There are major companies in global business environment
which considers that world is a single large market. This approach is majorly beneficial
in selecting appropriate geographical location for the business.
 Region centric- In this approach a company choose a particular economic region for
performing different business functions. It is one of the universally adopted market
selection approach which is beneficial in picking up different economic regions for
business operations. Major companies in international market take assistance of region
centric approach for performing development in business activities.
 Polycentric- This approach majorly chooses different foreign markets for conducting
different functions and activities related to a business. The polycentric approach is

considered as major approach of market selection which considers opportunities available
in foreign markets for business functions.
 Ethnocentric- Domestic market is considered as major geographical area for
ethnocentric market approach. There are many famous companies in international
business environment which use this approach for competing at the marketplace. This
provides a major advantage to the business owner in performing different operations with
effectiveness at the marketplace.
LO5
Various methods available to different companies to enter international market
In international market there are various methods available to a company to enter business
market to earn profit. Many companies choose different ways according to nature of business to
perform business transactions (Kourula, 2017). The various methods which are available to
different companies to enter international market are explained below:
 Import companies- In international business import related companies takes essential
goods and services from another countries. These companies are effective in fulfilling
demand of different products and services related to domestic market in a precise manner.
There are various different companies present in the market of United Kingdom which
performs trade related operations in a crucial manner. The goods which are produced in
outside country are effectively transferred at relatively high prices for satisfaction of
different customers.
 Export companies- The export related companies are concerned with transferring of
goods and services to foreign countries. These companies earn a huge amount of profit at
the marketplace and are also helpful in increasing the gross domestic product of the
country. Export companies sell products and services at relatively higher price which is
also beneficial in increasing national income of the country.
 Entre pot companies- These companies perform both export and import related
operations at the marketplace (Nielsen, 2018). In other words these companies perform
transfer of goods to other countries and also take goods and services from different
countries.

LO6
Techniques and tools of risk minimisation that is available to international companies
Risk minimisation in a business leads to profit maximisation thus it is essential for a business
to minimise risk associated with different operations. Risk is present in international market in a
wide sense that affects major decisions and functions of a business entity. In the international
business of Tesco it is compulsory to minimise risk in order to achieve organisational goals and
objectives. Risk minimisation is a crucial function of top level management which is working in
company for organisational objectives (Rasche, 2017). The various techniques of risk
minimisation for Tesco are mentioned below:
 Sharing risk- In this approach a business organisations shares specific amount of risk
with other organisations. This is considered as one of the crucial methods which is
effective in minimising risk related to different functions. A business organisation at
marketplace shares some risk with different business to minimise affect created by
present risk. There are several business organisations at the marketplace which are
involved in adopting this technique to achieve mutual goals. In operations of Tesco there
are many companies present to facilitate development associated with different business
transactions.
 Transferring risk- In the era of stiff competition between different companies in global
market this approach is considered as most appropriate. In this approach the organisation
transfers whole amount of risk associated with major operations in order to achieve
business goals. Tesco also transfers risk associated with its activities and functions in
order to achieve different market related targets.
 Avoidance of risk- The business organisations which are functioning in the global
business market sometimes ignores whole risk. It is essential for a business entity to
avoid whole risk associated with the business to achieve transparency. The professional
management which is present in Tesco also develops a competitive approach at
marketplace by avoiding complete risk associated with the business (Rönnberg, 2017).
There is a complete ignorance performed by a business entity in order to avoid risk
associated with a business in this competitive business world.
 Risk retention- This is an option oriented approach available to several business
organisations at the marketplace to minimise risk associated with the business. In this

technique a particular choice is available to a business in order to select less risky
approach for performing different operations. The risk retention technique is majorly
practised in operations of Tesco to gain competitive advantage.
LO7
Different universally adopted theories and concepts to enhance workplace experience in
international company
It is essential for a business organisation to adopt professional theory and concepts for
enhancing workplace experience. The productivity of different employees is increased with the
help of different theories that are proposed by different management scholars (Søderberg, 2017).
Various theories that are used by professional management which is present in Tesco for
increasing business operations:
 Human relations theory- In the era of stiff completion between different
companies in international market it is compulsory for a business to develop
harmony between employees. The human relations theory is a major approach
which is used by different business organisations at the marketplace to enhance
employee motivation. Employee productivity and group goals are achieved with the
help of human relations in major operations of Tesco. Company has also hired
professional human resource management for mainly performing employee related
orientation. With the support of human relations theory in operations an
organisation is able to achieve leadership related and group goals. Most of the
famous companies in global market take support of this theory to increase
organisational productivity.
 Contingency management theory – In the application of this theory in a business
entity one management is considered to manage different employees. The major
companies at marketplace hire skilled management in order to deal with
implementation of this theory in a precise manner. In international business
motivation and culture management is also facilitated by contingency management
theory to achieve mutual employee goals. Contingency management theory is a
major approach in increasing efficiency related to the business organisation. This

theory is essential to be implemented in a precise manner to achieve organisational
objectives in a short span of time.
 Bureaucratic management theory- In the field of international business this
theory play a key role by identifying governance rule in business organisations. The
bureaucratic management theory is helpful in providing competitive advantage to a
business by application of professional governance and rule. In international
business there are different functions which are performed by human resource
management by taking support of bureaucratic management theory (Wei, 2018).
The bureaucratic management theory is considered as universally adopted approach
which is beneficial in increasing organisational productivity. Tesco also takes
support of this theory in various activities and functions to achieve organisational
goals and objectives. This theory is also implemented by various famous
international companies of United Kingdom to gain competitive advantage at the
marketplace.

CONCLUSION
From the above discussion it can be concluded that international business is helpful in
providing essential goods and services to different customers who are present in the global
market. This report concludes that different businesses in international market choose different
techniques of market entry to perform business operations. It is very much important for a
business in international market to perform assessment of different economic factors for
understanding business environment in a precise manner. This report also concludes that it is
compulsory for management to hire professionally trained employees for performing
international business related transactions. In the global market there are different companies
which provide effective customer oriented solutions with help of business operations in market.