International Business Environment Report: M&S and Globalisation

This report provides a comprehensive analysis of the international business environment, focusing on key concepts and their implications for businesses. It begins with an introduction to international business and explores various techniques used to analyze the environment, including SWOT and PESTLE analysis. The report then delves into the impact of globalization and international trade on national economies, discussing both the benefits and challenges. A significant portion of the report is dedicated to examining the micro and macro environments of Marks & Spencer, evaluating the company's position and strategies within the global market. It covers the benefits, opportunities, and challenges of globalization and international trade for Marks & Spencer. The report also addresses the implications of cultural and regulatory diversity in international markets, as well as potential conflicts between corporate strategy and ethical, social, and sustainable responsibilities. Finally, the report concludes with a summary of the key findings and insights.

International Business
Environment

Table of Contents
INTRODUCTION ..........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Business techniques used to analyse the international business environment.................1
1.2 Impact of globalisation and international trade on national economies...........................2
TASK 2............................................................................................................................................3
2.1 Micro and macro environment of Marks & Spencer.......................................................3
2.2 Benefits, opportunities and challenges of globalisation and international trade for Marks &
Spencer...................................................................................................................................5
TASK 3............................................................................................................................................7
3.1 Implications for businesses of the cultural and regulatory diversity in international markets
................................................................................................................................................7
3.2 Covered in PPT.................................................................................................................9
3.3 Potential conflicts between corporate strategy and ethical social and sustainable
responsibilities........................................................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
International business refers to trade of services, capital and technology across national
borders. It consists the cross- border transactions of products as well as services among two or
more then two countries. It encompasses all the commercial activities which taken place to
promote transfer of products, resources, ideas, technologies and people across the national
boundaries. The international business environment is multidimensional consisting political
factors, exchange risks, taxation problems and the cultural differences (Black, Morrison and
Gregersen, 2013). This report is based on the Volkswagen Group. It is German multinational
automotive manufacturing organisation. In this given report will be discuss about business
techniques which are mainly used to analyse international business environment. The
globalisation and international trade both impact on national economies. There will be discussed
that the globalisation provides advantages, opportunities and challenges to business when it
conducts at global level. Implications for the businesses of regulatory and cultural diversity in
international markets will be discuss here.
TASK 1
1.1 Business techniques used to analyse the international business environment
International business consists any of business activity that cross the national borders. It
is related to selling and purchasing the services and products across border. National border are
crossed through company to expand business activities for an instance mining, banking,
education, communication etc. The international business includes cross- border transactions of
products and services among the two or more than two different countries. Transaction of the
economic resources consists skills, people and capital for purpose of international production of
physical services for an instance construction, baking and insurance. In order to conduct the
business at international level, there is a need to multinational organisations to bridge the
separate national markets in global market place (Boshyk, 2016).
Under this, environmental analysis is strategic tools that is mainly used to determine all
internal and external components which impact on performance level of company. Analysis
entails evaluation of opportunities and threats factors which might present. There are many
different business analysis tools which companies use to analyse international business
environment. Most common analysis tool that can be used in analyse the internal environment is
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SWOT analysis. It is explained as set of the methods which mainly used to analyse international
business environment factors which impact on performance level of an organisation (Burke,
Trahant and Koonce, 2012). This tool is helpful in aware about the strange of company that help
in conduct business operations at international level, determining the weaknesses help in over
come from them and also make better decisions. It helps in identifying better opportunities that
help in provide the better opportunities in future for gaining competitive benefits. Threats aware
about the complexities which an organisation can face.
The other tool is PESTLE to analyse the internal business environment in an effective
way. It provides help in understand that the political, economical, environment and the social
problems are different from country to country. It provide the knowledge about dynamic one of
one market can impact on other.
1.2 Impact of globalisation and international trade on national economies
Globalisation is explained as free movement of investment and trade, assets and labour.
The main aim of globalisation is to provide advantages to an individual economies around world
through making the market more efficient, limiting conflicts, spreading wealth and enhancing
competition (Cavusgil and et. al., 2014). It can be useful be conceived as process that embodies
transformation in organisation of the transaction and social relations. Main aim of globalisation
is to give company competitive position with minimum operating costs, gain large number of
services and products.
The globalisation develops main change in economy of country. The globalisation gives
free movement of investment, assets, labour and trade. On the other hand, economic
development by Globalisation develops positive and negative impact on society (Kankaanranta
and Salminen, 2013). The main benefit of economic development is high income per capita and
also higher standard of living because to enhance output. It enhance in the output that has
developed better employment opportunities which rakes nation towards prosperity.
International trade is explained as an exchange of services, capital and products across
the international territories and borders. This kind of trade provides rise to world economy and
represents significant share of the Gross Domestic Product (GDP). International trade plays a
necessary role in an economy of country. It allows to satisfy requirements of population that
stimulated internal development of country. It is helpful in expand markets for products and
services at international level. It is one of that main factor of openness and made better
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contribution towards economic development. An economy of United Kingdom is market-
oriented and highly developed. International trade of United Kingdom has experienced the rapid
expansion with dramatic economic development that has made country to be target world
(Kapoor and Sherif, 2012).
It has been stated from above mention graph that openness of UK economy is measured
through labour flows and international trade that has enhanced substantially. Under this, it has
been explored that the structural changes to economy arising from the globalisation that observed
daily in visit to organisations around UK. These are enhanced in access for UK business,
outsourcing no- core activities and openness of product markets.
TASK 2
2.1 Micro and macro environment of Marks & Spencer
Business organisation is part of business environment in which it operates. Micro and
macro are two different environments which impact on the business from internally as well as
externally. In this, micro environment refers to factors in immediate operation areas which
impact on decision making as well as performance freedom. These factors consists customers,
suppliers, general public etc. The micro environment impact on business directly. This
environment is closely linked with company. The micro environment includes different factors
which are given below:
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Illustration 1: Openness of the UK economy

Employees- Marks & Spencer is a large size organisation and it has large number of
employees which are highly talented, trained and skilled. The skilled staff members provides
Marks & Spencer to attain the objectives and goals (Laudon and Traver, 2016). the employees of
this company are able to provide the better experience to consumers and also focus on resolve
their queries. It helps in develop the positive impact on business productivity.
Customers- They are central part of business as they tend to attract as well as sustain
many consumers to generate more revenue. The customer base of Marks & Spencer is high and
strong due to its quality services. This company adopts the marketing strategy that attract new
consumers and sustain existing through determining their needs and demands. In this, change in
new market trends develop negative impact on the growth of organisation.
Macro environment is condition that exist in an economy as whole. It consists trends in
Gross Domestic Product, employment, fiscal policy, inflation etc. These factors are
uncontrollable and develop impact on decision making of company. Various factors included in
macro environment mention below:
Political factor- It consists the government rules, regulations, stability etc. Marks &
Spencer conduct its business operations in more than 40 countries. The political situation of
United Kingdom is stable and from this, firms do not face any kind of issue in conduct their
business in United Kingdom. So, in this manner it develops positive impact on the business and
on its productivity.
Economic factor- As relative to other countries, United Kingdom has strong economic
position. It has the diverse economy and high GDP rate. It enhancing the Foreign Direct
Investment (Lewis, 2017). From analyse all these factors, firm can able to perform in better
manner and enhance attain its business objectives within specific time period.
Social factor- The preferences and needs of customers are changes with in short period of
time. The people demand high quality of products in reasonable cost. In United Kingdom, there
is shift in demand for the fashionable clothing. Price sensitivity of more customers that enhanced
leaving company in less competitive situation.
Technological- As United Kingdom is economically developed country and have better
access to technology. This country has advanced telecommunication infrastructure in world. This
factor plays a necessary role in communicating the new fashion to consumers. New technology
can be used to determine new fashion trends in various parts of world.
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2.2 Benefits, opportunities and challenges of globalisation and international trade for Marks &
Spencer
Globalisation and international trade both are important concepts. International trade has
necessary share in GDP in various countries (Parhizgar, 2013). On the other hand globalisation is
related to interdependence among countries that arising from integration of various aspects of
economy.
Benefits, opportunities and challenges of globalisation
Benefits
Free trade- It is way for the countries to exchange resources and products. It means that
Marks & Spencer can be specialise in producing the produces where it gain the competitive
benefits. Through this, Marks & Spencer can do the free trade and provide products at low costs.
Increased investment- Globalisation has enhanced investment level and it has made it
more easier for Marks & Spencer to attract long term and short term investigation. In addition to
this, investment through Marks & Spencer can play a necessary role in make improvement in
economy of country.
Opportunities
Target new market- From conducting business at global level, Marks & Spencer can
target the new market and get better opportunities. It will help in enhance sales of business along
with productivity.
For an example- When Marks & Spencer enter in to the new market then it came with the
new concept or the new clothing segment that attract the customers most and in this manner
company target the new market.
High customer base- The main opportunity of globalisation is to enhance the customer
base of Marks & Spencer. It helps in increasing profit of firm (Rowell, 2017).
For an example- As Marks & Spencer has strong brand name but through entering in to
new segment it gain attention of new consumers and make high customers base.
Challenges
Public relations- Under this, public branding and image both are the most necessary
component of business. Developing public relations potential in new geographical region is main
challenge for business.
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For an example- The culture and preferences of each country people is different. If
Marks & Spencer will expand its business in Qatar then it face complexities to deal with the
Qatar people and can not develop better relations with them easily.
Legal and regulatory structure- Each country has unique regulations and laws that
governing business. It is necessary for the Marks & Spencer to understand the regulatory and
legal climate before entry in to new market so that company can not face any complexities.
Example- When Marks & Spencer expand its business in Qatar then face the complexity
about to understand the legislations and the regulatory structure of that country. The legislations
such as environment law, contract law etc. are different from country to country. From this,
company can face the challenge to conduct its business.
Benefits, opportunities and challenges of international trade
Benefits
Enhanced revenue- It is one of the important benefit of international trade that helps in
enhance number of the customers. It helps in open the new pathway to growth of Marks &
Spencer as well as enhanced revenues (Salvatore, 2015).
Example- When Marks & Spencer expand its business in Qatar market then it can target
the new market and offer unique products that attract them most. It increased sales and revenue
of Marks & Spencer.
Promotes Efficiency in Production- In this, international trade helps in promote
efficiency in the promotion and Marks & Spencer will try to adopt the better production methods
to keep the cost reduce for gaining competitive benefit. By offering the products at minimum
cost, the firm can gain the large market share.
Example- Marks & Spencer provides the high quality of products of services at
reasonable cost in Qatar to target new people. It helps in enhance large market share. Through
this incentive to produce the goods arise efficiency for Marks & Spencer.
Opportunities
Brand recognition in international market- Through international trade, the brand
recognition will be enhances in the international market and through this, firm can get the
competitive advantages in an effective manner.
Example- For better brand recognition in Qatar country, Marks & Spencer will conduct
the promotional activities to aware people about the new and unique products or services.
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Tax benefits- Sometimes, internal trade provides the opportunity regarding availing tax
benefits. As having an treaty of country allows the organisation to attain the tax benefits and
improve profit margin.
Example- When Marks & Spencer conducts its international trade then it need to analyse
the tax rate to get the better benefits. From this, firm can get the tax benefits.
Challenges
Distance- In this, due to the long distance among various countries, it is complex to
establish the close and quick trade contacts among traders. Sellers and buyers meet one other and
also personal contact that rarely possible (Savrul, Incekara and Sener, 2014).
Example- The distance among UK and Qatar is far and it is complex for the UK to quick
trade in Qatar.
Complexities in transportation and communication- Receipt and Dispatch of products
take long time and also includes considerable expenses. At the time of natural calamities,
transportation of products more complex. In context to this, cost of receiving or sensing
information is high.
Example- Language is main barriers and the nor verbal communication can break
business deals. The business etiquette abroad and the cultural traditions are different in United
Kingdom and Qatar. These all are the barriers in international trade.
TASK 3
3.1 Implications for businesses of the cultural and regulatory diversity in international markets
In present, there are different types business organisation who deals in different types of
products and services out side of market is called international market. It is important for
company to adopt cultural changes for the purpose of increasing business activity in international
market. The main advantages is to attain goals and objectives by setting the standard. It is
important for organisation to understand the different culture and maintain productivity in
business by adopting challenges. In other words, multinational and cross cultural teams helps
Mark and Spencer as well as other organization to increase diverse knowledge based on business
objectives and changes in taste of people that impacts on business positively. The implication of
cultural and diversify of other company in international market is defined as:
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Communication: Amazon is multinational company that operates its business in
different nations by accepting new culture and regulations that impacts on business. As it
expand its business in international market by adopting new culture such as language and
tradition of that nation, helps to get success in business expansion and maintain the productivity
for long term. In international market, Amazon focuses on language and tradition that are de
facto language and tradition of business which is need to implement by organisation for the
purpose of expanding business in international market.
Another example is Flip cart that provides its products and services in various nation by
entering in to international market. It impacts on businesses such by learning language, proper
communication and culture of new nation it can maximize its sale and provide training to
employees to understand people demands and give them satisfaction. Therefore, this impacts
positively on business which helps to increase productivity and profitability by entering in to
international market.
Workplace etiquette: Tesco is a British super market that deals in different types of
products in different country by focusing on workplace etiquette. This is another cultural
diversity that impacts on international market. For example, manager of Tesco has decided to
expand its business in international market by opening stores that will helps to increase profits.
In this situation manager need to understand the workplace etiquettes in order to deal with new
people and that also helps to aware from their needs. There is also need to accept more etiquettes
where organisation is running its business that helps to increase productivity and profitability due
to having good etiquettes. Therefore, manager of Tesco learn work place etiquettes for
expanding business in international market and reach globally that impacts positively.
Regulatory diversity is consider as rules and regulations which are governed by
government for the purpose of running a business at international market. It impacts on business
positively that helps to expand the business ,in different country. The organization need to
accept new regulatory diversity for international market. Organizations adopts different types of
regulatory diversity in international market that is defined as below:
Tariffs and custom regulation: This regulatory diversity impacts on different type of
organizations in order to enter in to international market such as organisation has to adopt new
government policy for running a business in international market. Thus, it helps Flip Cart,
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Amazon and all organization to to enter in to new market and expand its business globally by
accepting new trade policy.
Product safety regulation and environment rules: This rule is also governed by
government of other country in which companies are running their business effectively. It
impacts positively such as Tesco and other organization follows this rule and provide better
quality of products as per customer demand that helps to increase productivity and profitability
by selling the products in international market. If organizations follows this rule then it can beat
the competition and sustain in competitive environment.
From the above mentioned cultural and regulatory diversity it can be understand that both
are important for all organization as it helps to follow new trade policy by accepting challenges
for the purpose of running a business international market. Moreover, it impacts positively
maintain business globally and reach near by goals of organisation.
3.2 Covered in PPT
3.3 Potential conflicts between corporate strategy and ethical social and sustainable
responsibilities
Corporate strategy is highest plan of company that explains corporate overall directions
and products. It is clearly defined and the long term vision of direction of an organisation. Under
this, firm acquires the business other than its current goods. It is company wide plan to select as
well as develop specific markets to make improvement in different units of business. The
corporate strategy of Marks & Spencer is to covering the wider market share by following the
low cost competitive strategy.
Ethical responsibility is ability to identify interpret and also act on many principles and
the values on the basis of standards with in given context. It is sphere of obligation or duty that
aligned to an individual through nature of position, work and function of a person. The Marks &
Spencer company was named as 'Britain's Most Ethical High Street Retailer For Clothing'
through ethical consumer.
Social responsibility refers to ethical framework and also suggest an entity that has an
obligation to act for advantages to society at large. In this, it is duty of each person to person for
maintain the balance among economy and social system. In this, the main social responsibility of
Marks & Spencer is to be the most suitable retailer in world. For attaining this, it launches Plan
A by consisting 100 communities to achieve in 5 years.
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The main aim to develop the corporate strategy is to earn profit and work in favour of
company and in social and ethical responsibility, company focus towards society. So, there is a
conflict among corporate strategy and the ethical or social responsibilities. It arise the conflict
among stakeholders because they expect the high return. Conflicts between the shareholders and
the corporate social responsibilities of organization has become a major reason that occurs in
organization with critical aspects and facts. Shareholders expects high returns and consideration
form the organization in respect of their invested capital in organization. Internal and external
stakeholders are the major conflicts found in in organization. However, to provide additional
benefits and desired consideration to shareholders the social responsibilities remain lack behind
that somewhere create complex situations for organization. These conflicts arise the issues
sustainability of business at marketplace.
CONCLUSION
It has been concluded from the above mention information that international business
helps in expanding business outside the boundaries of country. Company conduct an
investigation and analyse the international business environment before conducting business.
SWOT analysis is an effective tool that has been used through an organisation for analyse
business environment in better manner. Macro and micro both environment impact on the
business operations and activities of company. There has been studied about the benefits,
opportunities and challenges of globalisation to business. The Corporate Social Responsibility
helps in provide the sustainability as well as competitive advantage to business in significant
manner.
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