International Business Environment and Strategies of Unilever

This report delves into the international business operations of Unilever, a leading FMCG company. It begins by explaining the international business environment, focusing on cultural, economic, and political influences in countries like the UK, USA, India, and Australia. The report then describ...Read More

International Aspects of
business

Contents
INTRODUCTION.....................................................................................................................................3
MAIN BODY.............................................................................................................................................3
1.1 Explain international business environment in which a selected organisation operates.....................3
1.2 Describe the mechanisms that regulate international trade................................................................3
2.1 How environment and culture of another country affects a business operating internationally.........4
3.1 Describe how the financial environment affects businesses that operate internationally...................5
4.1 Identify why businesses operate internationally................................................................................5
4.2 Evaluate the business strategies used by a business operating internationally...................................6
CONCLUSION......................................................................................................................................7
REFERENCES..........................................................................................................................................8

INTRODUCTION
International business is one of the necessary concept involves discussion on how entity
is used to do business in different region or nation. On the global platform, business entities are
used to be effected by cultural imbalances, social-political influences as well as technological
advancement, which other business follows. This repot will be carry on Unilever which is the
UK’s leading FMCG firm which sell its products for daily uses. The major aim of this report is
to discuss environment in which selected firm operates. Also, discussion on mechanism that
helps to assists in regulating international trade and identification on business operates
internationally.
MAIN BODY
1.1 Explain international business environment in which a selected organisation operates
Unilever operates on an international level and other nations such as USA, India, and
Australia, in which impact of cultural diversification is higher and severe. International business
not only depends on how business operates, but also relies on cultural aspects of the location. In
UK, where cultural and political influences is low, hence business condition is controlled in that
environment. International business environment means treading, economic influences, cultural
influences and social impact etc. Not only in UK, has Unilever saw economic fluctuation as part
of international business environment in India, USA and Australia (Fonfara and et. al., 2016)
This leading FMCG has suffered with issues, where business closure was higher expectancy and
closure of business was about to be happen. But, in last decade, Unilever has comes out as
successful business, instead of initiating closure or shift of the business operation, they has faced
every face situation with their trading policies & policies. In India, FDI is higher, due to support
of which Unilever can invites funds from other business to carry out business operation for
longer duration. In USA, due to the flux in economic policies, Unilever has struggled to launch
its new products and due to which business suffered with higher disclosure of this business
operations. Hence, for this firm correct and clear success is there if, Unilever would understand
the market on potential side or basis.

1.2 Describe the mechanisms that regulate international trade
Trade are being regulated using bilateral treaties among different nations. After period of
world war, free trade are emerged as dominant doctrine, multilateral treaties like GATT and
support of world trade organisation has becomes principle regime for regulating and controlling
global trades. There are different mechanisms platform such as IMF and world trade organisation
which assist in getting trade standards such as transferring of goods using the either sea or air
routes. There are various mechanism which guides WTO in regulating and controlling global
trading system are as non-discrimination provides two major policies: most favoured nation
(MGN) and national treatment policy (Meyer and Peng, 2016) MFN is embedded in the main
WTO rules of goods, services and scope for the intellectual property. National treatment policy
adopted to address non-tariff barriers to trade which says that every good is equal and valuable.
Binding and enforceable commitments: The tariff commitments established by the WTO
member’s in proactive process multilateral trade negotiation and accession are enumerated in a
list of concessions. UK can change its commitments but only at the same, which comes under
interest of WTO and national treatment policy. If satisfaction has not obtained, complaining
country may invokes WTO disputes settlements procedures. Nation who is doing trade with
other nations are strictly required to follow transparency and global trading safety values.
2.1 How environment and culture of another country affects a business operating internationally
Business operation of the Unilever are on global stage and providing valuable FMCG
product to people of their daily uses. In different nation such as culture and environmental
aspects pursued some kind of flux while doing business. In India, cultural of people is to utilise
their income on valuable, says like daily basis, in that condition firm is required to expand their
production units to fulfil an actual gap between demand and supply. In nation like Turkey and
Iran, where Unilever is operating has to face restriction on selling some products as because of
strict religious factor or some negative influences (Cohen, R. B., 2018). This would impact
Unilever business growth and strategic position to grow into market. Due to trade war between
USA and Iran, which is critical business environmental problem has led Unilever to short down
its own sales and impact on revenues. People of India looks FMCG goods as positive, it helps in
fulfilling daily wants and needs of people such as food, soaps and other utensils. These kind of

the cultural influences have major impact on business regulation for those business such as
Unilever which is operating on international platform.
3.1 Describe how the financial environment affects businesses that operate internationally
Unilever is one of the leading FMCG firm operating in different part of the world selling
the selling daily uses products or services on greater scale of business operations. Right now,
financial environment on global level is not appropriate, as because of fall in the value of US
dollar, on which business and trade operates. Along with this, strategic relationship of financially
strong countries have put burden on Unilever to pulls out its name for free financial support
committee of WTO to trade in any business environment favourably. Rise in prices of crude oil
as the increased the prices of transport and Unilever FMCG products price is also raised in
response to this. On global platform, financial imbalances has been raised and led to the
dependency on own financial regulation (Richter, N. F., and et. al., 2016). Due to this financial
imbalances, financial environment is not appropriate and also results into fluctuation and trouble
of increasing business profitability at the proactive stage of working. This was the indication to
Unilever to change their financial policy to operate on global platform. Strategic planning and
making financial policies will be cure for Unilever to operate in any business environment
favourably and nominally.
4.1 Identify why businesses operate internationally
Business operates international to continue its existence for longer time period. Unilever
which was started and founded in UK has saw after 2 years of its existence that to grow
operations, it’s better to expand business on an international platform such as India, Australia
and USA to ensure growth of the firm at the potential level or stage. From example of the
Unilever, this was revealed that FMCG firm have higher chances of the business growth, as it’s
provides products of daily purposes or needs. Business operates internationally to acquire more
customer and increases brand image to create business on even double or thrice matter. One
major reason behind operating internationally in ensuring growth for the business and increasing
profitability with vision of increasing it for coming business life tenure. Business like Unilever
have visualises the vision to expand its product and services reach to maximum people in less
time and do social welfare in vey less time. Also, Unilever is suggested to go for market research

for expanding internationally to other nation or counties to build exposure of its quality products
all over the world and providing job employments to more peoples.
4.2 Evaluate the business strategies used by a business operating internationally
Unilever which is the operating firm on global platform is looking for accurate strategy to
expand its own product reach to an international level. Unilever has structured the policies and
regulation who role is to identifies scope of selling and searching for prospective in other
location. Unilever top management has decided to comes up with joint treaties with the
investment firm, so as to FDI in area such as production and operation & supply chain
management to facilitates availability of their products internationally even no setting up
production units in that location. Joint strategic growth orientation can be another option with
other firm so as to ensure about to start business operations on the other firm (Zander and et. al.,
2015) In response, Unilever has led output based strategy of outsourcing to gather resources for
local people and then produces final product to ease convenience to people. Using this strategy
expectancy of the firm has grown to operate business on top stages and using the outsourcing a
major tools to get easy resources in less time period.

CONCLUSION
From above report, it is concluded international business concept is one of the necessary
concept, which plays its role of understanding market situation and suitability to makes growth
of the business firm preventive for longer time period. It is also concluded that business expand
to other nation to increases it’s tangibility for longer time duration.

REFERENCES
Books & Journals
Zander, I., and et. al., 2015. Born globals and international business: Evolution of a field of
research. Journal of International Business Studies. 46(1). pp.27-35.
Richter, N. F., and et. al., 2016. A critical look at the use of SEM in international business
research. International Marketing Review. 33(3). pp.376-404.
Cohen, R. B., 2018. 12 The new international division of labor, multinational corporations and
urban hierarchy. Urbanization and urban planning in capitalist society, 7.
Meyer, K. and Peng, M. W., 2016. International business. Cengage Learning.
Fonfara, K., and et. al., 2016. Change and transformation of networks and relationships—
Fundamental aspects of business reality. Industrial Marketing Management. 58. pp.187-189.
Picciotto, S., 2017. Rights, responsibilities and regulation of international business.
In Globalization and International Investment (pp. 177-198). Routledge.
Online
INTERNATIONAL BUSINESS, 2018. [Online]. Available through: <
https://www.referenceforbusiness.com/management/Gr-Int/International-Business.html >