International Business and Globalisation: Morrisons Expansion Analysis

This report analyzes the international business opportunities for Morrisons, a major UK retail corporation. It explores the benefits of internationalization, including access to new markets, diversification, talent acquisition, competitive advantages, and foreign investment opportunities. The report examines Morrisons' current business activities and the concept of globalization, highlighting the challenges of internationalization such as cultural differences, communication, and trade regulations. The report suggests solutions for mitigating these challenges, focusing on how Morrisons can leverage internationalization models to expand its business operations. The report discusses the benefits Morrisons could gain from global expansion, including increased profitability, efficient resource utilization, and overcoming domestic market competition. It also covers the potential for diversification, talent acquisition, and the creation of a competitive edge in the global market. The report emphasizes the importance of foreign investment opportunities and how Morrisons can benefit from them. The report concludes by summarizing the key findings and emphasizing the importance of internationalization for Morrisons' future growth and success.

Running head: INTERNATIONAL BUSINESS
INTERNATIONAL BUSINESS: AN ANALYSIS OF THE OPPORTUNITIES THAT
GALORE MORRISONS, UK
Name of the Student:
Name of the University:
Author’s Note:

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Table of Contents
1.0 Introduction................................................................................................................................2
2.0 Business Activities of Morrisons...............................................................................................2
3.0 Concept of Globalization or Internationalization......................................................................3
4.0 Benefits of International Business Operations..........................................................................4
4.1 New Markets..........................................................................................................................4
4.2 Diversification.......................................................................................................................5
4.3 New Talent Acquisition.........................................................................................................6
4.4 Competitive Advantage.........................................................................................................7
4.5 Foreign Investment Opportunities.........................................................................................8
4.6 Product Improvement............................................................................................................8
5.0 Models of Internationalization and Morrisons..........................................................................9
6.0 Challenges of Internationalization and Possible Solutions......................................................10
7.0 Conclusion...............................................................................................................................11
References......................................................................................................................................13

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1.0 Introduction
As stated by Buckley (2016), internalization had become the latest catch-phrase of the
business world and it is seen that the majority of the business corporations are presently
undertaking the concerned process for the purpose of enhancing the scope of their business.
Child et al. (2017) are of the viewpoint that the adequate usage of the process of globalization or
internationalization offers different benefits to the business corporations which in turn propels
them to use the same. Some of the most important benefits offered by the process of
internationalization to the business corporations are related to the aspects of new markets,
diversification, product improvement, acquisition of new talent, foreign investment
opportunities, competitive advantage and others (Cantwell 2017). However, there are various
challenges that the business corporations commonly face while undertaking the process of
internationalization like the challenging of coping up with the cultural differences, mastering
new foreign markets, communication, trade regulations, human resources and others (Meyer and
Peng 2016). Furthermore, these challenges of internationalization if not adequately managed or
mitigated can significantly hinder the attainment of the goals or the objectives with the
internationalization are being undertaken by the corporations. Thus, it becomes important for the
corporations to not only adequately resolve or mitigate these challenges but also take the help of
effective internationalization models for undertaking the concerned process. The purpose of this
report is to shed light on the benefits or the opportunities that the corporation Morrisons would
be getting by undertaking internationalization.

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2.0 Business Activities of Morrisons
Morrisons, established by William Morrison in 1899, is the 4th largest retail corporation
of the nation of UK in terms of the financial returns earned by it (Morrisons.com 2020). The
corporation has extensive interests within the retail sector of UK however in the present times it
is seen that the concerned corporation had significantly expanded its product portfolio and
thereby books, electronic products and others are also being offered by it (Morrisons.com 2020).
It is headquartered in Bradford and the department stores related to it offers a wide range of
products to the customers like cloths, books, electronic products, food and drink and others. The
profit of the corporation in the year 2018 was £17,262 million and the number of individuals
working for the concerned corporation in the same year was more than 110,000 (Morrisons.com
2020). However, at the same time it needs to be said that despite the extensive success that the
concerned corporation had been able to attain within the nation of UK in the past 120 years it had
not expanded its business operations to the other nations of the world (Morrisons.com 2020).
Furthermore, the different competitors of the concerned corporation like Aldi, Amazon and
others are all operating in overseas markets which in turn had offered them the added edge
within the retail sector of UK. It is in the light of these aspects that Morrisons is presently
considering expanding its business operations in the overseas markets.
3.0 Concept of Globalization or Internationalization
Hamilton and Webster (2018) are of the viewpoint that although the concept of
globalization or internationalization had been in existence since the traditional times yet it was
seen that the extensive usage of the same by the business corporations began during the
Industrial Revolution of England in the 19th century. Adding to this, Cravino and Levchenko
(2017) have observed that the two most important which had contributed towards the extensive

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usage of this particular concept by the business corporations are the improvements in the fields
of communication and transportation. Thus, presently it is seen that the different corporations
taking the help of these two advancements are increasingly operating in the various countries of
the world for the enhancement of the scope of their business. More importantly, the extensive
usage of the process by the different corporations had transformed the entire world into a global
village wherein corporations from diverse nations have the option to indulge in trade and
commerce irrespective of the nations to which they belong (Cuervo-Cazurra 2016). In addition to
these, the corporations have the opportunity to explore new markets, the opportunity to sell the
surplus products or services manufactured by them and thereby enhance their profitability
through the usage of this particular process (Buckley 2017). Furthermore, the efficient usage of
this particular process had proved to be the cornerstone of the success as well as the growth
attained by the different corporations like Amazon, Apple, Microsoft, Google and others
(Picciotto 2017).
4.0 Benefits of International Business Operations
4.1 New Markets
As discussed by Strange and Zucchella (2017), globalization began to be extensively
used during the Industrial Revolution since it afforded the opportunity to the business
corporations to sell the surplus products or the services which were manufactured by them in the
different overseas markets and thereby enhance their profitability. Adding to this, Picciotto and
Mayne (2016) have noted that by undertaking the process of internationalization the corporations
have the opportunity to utilize the target markets or for that matter the customer base of the new
markets which are entering into. This can be explained on the basis of the fact that the customer

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base which the corporations get in their parent nation are often limited and often shared by its
major competitors as well (Kolk 2016). Thus, by undertaking this particular process the
corporations have the option to significantly enhance their customer base and thereby increase
the financial returns earned by them as well. Another important benefit which the adequate usage
of this particular process offers to the corporations can be attributed to the fact that it helps them
to use the technological advancements, labor and other resources of the host nations for the
manufacture of their products or services and also for the improvement of the other aspects of
their business (Sinkovics et al. 2016). This in turn offers abundant growth or development
opportunities to the corporations and in the longer-run also helps to acquire competitive edge
within their parent nation through the effective utilization of the resources offered by the host
nations or the new markets.
In the light of the above discussion, it can be said that Morrisons would be able to
positively benefit by going global. Firstly, the corporation would get the opportunity to sell its
products and services in the new markets and thereby will have the opportunity to increase its
profitability significantly which in the recent times had been affected by the increasing
competition within the retail industry of UK. Secondly, it would also get the opportunity to
effectively utilize the technological resources, labor and other resources of the host nations in
which it will expand and this in turn would help the corporation to increase its growth rate and
attain its business objectives. Thirdly, this will also help the corporation to overcome the adverse
effects of the intense business competition which it faces within the retail market of UK through
the usage of the customer base of the host nations.

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4.2 Diversification
Teagarden, Von Glinow and Mellahi (2018) are of the viewpoint that an important
benefit which is being offered by the usage of the process of internationalization to the
corporation can be attributed to the aspect of diversification. Adding to this, Brannen, Piekkari
and Tietze (2017) have noted that global business operations affords the opportunity to divest
their interests or assets which in turn helps them to reduce the adverse effects of the damages or
the losses that they face. For instance, if a particular corporation faces significant business losses
in one particular market of its operation then it had the option to balance the same by enhancing
its profitability in the other markets in which it is operational (Tenzer, Terjesen and Harzing
2017). Thus, it had been seen that the corporations are increasingly becoming operational in
multiple business markets so as to divest their interests and thereby reduce the gravity of the
business losses or the damage that they might face. Morrisons is presently reliant on the retail
sector of UK for the conduct of its business and thus if the concerned market gets adversely
affected in future due to financial recession, increased business competition and others then this
would negatively affect the growth rate as well as the profitability of the concerned corporation.
However, had Morrisons been operational in different nations then even if it faced losses in the
retail sector of UK this would not substantially affect the prospects of the corporation since it
would have the option for the losses from the other markets in which would be operational.
4.3 New Talent Acquisition
According to Chow and Schoenbaum (2020), the growth or for that matter the
development of the different business corporations is heavily reliant on the talent, skill sets,
qualifications and other important attributes of its workers. Wettstein et al. (2019) are of the
viewpoint that an important negative connotation of the contemporary business landscape is the

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fact that because of the emergence of numerous business corporations, the corporations are
facing a labor crisis. This in turn is making it very problematic for the corporations to get the
required number of talented, skilled and professionally qualified workers to work in their
corporation. However, at the same time it needs to be said that the corporations which are
operating globally are not much affected by this issue since they always have the option to
procure skilled labor from the host nations in which they operate (Kourula, Pisani and Kolk
2017). More importantly, it had been seen that the corporations operating on a global basis like
Apple, Microsoft, Amazon and others while being able to resolve their labor issues had also been
able to get talented skilled which in turn had added value to their corporation (Picciotto 2017).
Thus, it is likely that Morrisons by indulging in global business operations would be able to
substantially resolve the labor crisis which it is presently facing within the nation of UK and also
acquire skilled as well as talented laborers from the host nations as well. In addition to this, these
workers would also create value for the corporation by providing their inputs for the
improvement of the different processes of the corporation as well.
4.4 Competitive Advantage
According to Kingsley, Noordewier and Bergh (2017), the corporations undertaking the
process of internationalization often get the first-mover advantage in comparison to their
competitors who expand latter on and this in turn enables them to have a competitive edge over
their competitors. Adding to this, Hutzschenreuter, Kleindienst and Lange (2016) have noted that
this often helps the corporations to create strong brand awareness among their customers before
the expansion of their competitors and thereby effectively exploit the markets of the host nations.
Thus, it is likely that Morrisons by indulging in global business operations would be able to
enjoy this first-movers advantage in the different overseas markets which in turn would help it to

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not only acquire competitive edge in the host nations but also within the retail sector of the
nation of UK as well.
4.5 Foreign Investment Opportunities
Child et al. (2017) are of the viewpoint that the process of international expansion also
provides various kinds of foreign investment opportunities to the corporations which they are not
being able to enjoy within their parent nations. Adding to this, López‐Duarte, Vidal‐Suárez and
González‐Díaz (2016) have noted that this often helps the corporations to build new resources,
form new partnerships with the corporations operational in the host nations and others which in
turn help in the expansion of the scope of their business. More importantly, the corporations like
Morrisons which are solely operational in one business market fail to get these opportunities and
this in turn substantially narrows down the scope of their business. Thus, it is likely that
Morrisons by indulging in global business operations would be able to get foreign investment
opportunities which in turn would help it to build resources, form partnerships and others which
in turn would help it to expand the prospects of its business and thereby attain the required
success as well.
4.6 Product Improvement
As opined by Buckley (2016), the process of global expansion offers the opportunity to
the business corporations to undertake the process of product or service optimization or
improvement. For instance, the corporations have the option to use the resources or the
technologies of the host nations, integrate the needs, requirements, demands of the customers of
the host nations and others for the improvement of the quality of the services or the products
offered by them (Cantwell 2017). This in turn helps the corporations to standardize the products
or services offered by them which in turn improves their quality and also makes them more

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preferable for the customers as well. Thus, it is likely that Morrisons by indulging in global
business operations would be able to improve the quality of the services or the products which
are presently being offered by it. More importantly, the majority of the products or the services
which are presently being offered by Morrisons have been designed taking into account the
needs or the requirements of its UK customers and this in turn had significantly narrowed down
their quality. However, Morrisons can overcome this particular limitation of the products or the
services offered by it through the effective utilization of the resources offered by the host
nations, the integration of the needs or the requirements of the customers of the host nations, by
undertaking the process of product or service standardization or optimization and others. These
are likely to enhance the sales volume of the corporation and thereby improve its profitability as
well.
5.0 Models of Internationalization and Morrisons
Hamilton and Webster (2018) are of the viewpoint that the success attained by the
business corporations through the usage of the process of internationalization is greatly reliant on
the effectiveness with which they are being able to use appropriate models of
internationalization. Adding to this, Meyer and Peng (2016) have noted that depending on the
nature or the purposes with which the corporations are undertaking the concerned process, some
of the most important models and theories of internationalization are the Uppsala model of
internationalization, the network model and the Transaction Cost Theory. The Uppsala model of
internationalization states that the corporations rather than directly undertaking the process of
expansion need to first create the demand for their products or services through direct export and
once the demand for the same had been established then they can undertake physical or direct
expansion (Strange and Zucchella 2017). On the other hand, the network model states that the

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business corporations need to expand only in those markets wherein it would be able to maintain
effective interpersonal and inter-organizational relationships with the different actors in the
concerned market (Tenzer, Terjesen and Harzing 2017). Lastly, the transaction cost theory
focuses on the cost that the corporations would incur by undertaking the process of expansion
and thereby recommends expansion into the markets wherein the corporations would be able to
recover the costs that they have invested for undertaking the expansion (Wettstein et al. 2019). In
the particular context of the corporation Morrisons, it can be said that the best model of
internationalization that the corporation can use for expanding into the business markets of other
host nations is the Uppsala model of internationalization. Furthermore, through the usage of this
model the corporation would have the opportunity to enhance the demand for its products or
services by way of exporting the same to the markets of the host nation and once the demand had
been established it can undertake the physical or the actual expansion. More importantly, this
will significantly reduce the losses and the risks or the threats the corporation would have faced
had it directly expanded into the business markets of the other host nations.
6.0 Challenges of Internationalization and Possible Solutions
As stated by Kingsley, Noordewier and Bergh (2017), an important factor which deters
many corporations from undertaking the process of internationalization can be attributed to the
challenges or for that matter the issues that the corporations face related to the usage of the same.
Adding to this, Picciotto and Mayne (2016) have noted that some of the most important
challenges that the corporations while undertaking the process of international expansion are
challenges related to physical distance, unfamiliar cultures, difficulty in developing effective
marketing plans for the target market of the host nations, communication challenges, trade
regulations and others. In the particular context of Morrisons, it needs to be said that these are

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some of the challenges that the concerned corporation is also likely to face for the purpose of
undertaking international expansion. However, the corporation also have the opportunity to
resolve these challenges or the issues through the usage of the below outlined measures-
 The challenge related to physical distance can be easily mitigated through the
development of effective communication between the parent nation and the host nations
via the usage of digital media tools
 The challenge related to unfamiliar culture can be easily mitigated through the usage of
the cultural competency and also effective cross-cultural communication
 The corporation can develop effective marketing plans by taking note of the marketing
plans developed by its rivals in the host nations and also by integrating the needs or the
requirements of the customers within the same
 The challenges related to trade regulations and others can be resolved through
establishing business units in the host nations and also through the formation of
collaboration with the government of the host nations, its business corporations and
others.
7.0 Conclusion
To conclude, the business corporations have the opportunity to significantly improve the
prospects of their business by undertaking the process of internationalization. More importantly,
global expansion offers the opportunity to the corporations to exploit new markets, divest their
interests, attain competitive advantage, undertake product development, undertake foreign
investment and others. However, at the same time it is seen that the corporations also face
different challenges related to international expansion like challenges related to physical