Global Business Environment: SME Opportunities and Threats

This report examines the global business environment in which Small and Medium Enterprises (SMEs) operate, highlighting the competitive and dynamic nature of international markets. It analyzes the opportunities, such as technological advancements, international business growth, and customer satisfaction, as well as the threats, including dynamic environments, changing consumer preferences, environmental factors, and new market entrants. The report further explores the advantages of international trading blocs and agreements, focusing on foreign direct investment, increased competition, trade effects, and marketing efficiency. Finally, it details various tariff and non-tariff barriers that affect international trade, providing insights into specific duties, combined duties, quota systems, domestic content requirements, and product labeling. The content provides a comprehensive overview of the challenges and opportunities SMEs face in the global market.

Tapping into New
and International
Markets

 P1 Explain the global business environment in
which SME business operate.
• Global business environment is the highly competitive and
challenging market which provides different opportunities and
growth (Global business environment, 2018).
• It is defines different sovereign countries it is the environment
which attracts company towards the growth.
• It is the great opportunity or growth which influences small
scale company to adopt opportunity and growth. Global
business environment. Business global market is highly
influenced by the different factors which impact the business
performance.

P2 Analyse the threat and opportunities that face
SME in an increasingly competitive global
environment.
In global environment there are present number of opportunity
and threat in the market conditions. Through which company
adopts the best possible way of business expansion. Global
environment are highly dynamic in nature. It provides the various
opportunity in terms of expansion, customer satisfaction etc.
there are some opportunity and threat for the company to adopt in
order to take the company profit (Iacobucci and Hoeffler, 2016).

Opportunities
Technology development: it provides the best possible growth
with the help of technological development. It provides overall
growth and company development Technology factor is the
highly growth factor which helps company to adopt the best
possible practises.

International business growth: Global environment provides
opportunity to take the business into international level (Longin
and Würschum, 2016). It gives opportunity and growth in terms
of business prospective. Global environment involves great
possibilities which makes business more competitive and strong.
Moreover, the main objective of the organisation is to collect the
best possible target market and business opportunities. Global
environmental and global business value helps to operate
business at international level.

Customer satisfaction: Cook company provides home made
meals to the customers at global level. With high quality of
products and services company adopts the best quality of food
ingredients and raw material. This opportunity helps to attract the
customers and brand value in the market position. Global market
helps to generate big opportunity and growth market which helps
to attract large number of customers (Lu, 2017).

Threats
Dynamic environment: This is the dynamic environment in
which Cook operate its business activities. This is the biggest
threat for the company. Dynamic environment is the effective
and challenging environment which brings opportunity and threat
too. It is the challenge for the company environment to adopt
sudden changes such as interest rate, inflation rates, customer
needs and wants. This is the overall activity which require
changing environment.

Changes taste and preference: customers are the key source of
profit maximization. Customers are rational they attract towards
those brands whose provides services at low prices or at good
quality. Overall, in order to overcome from this threat company
needs to offer different schemes and offers on the meal in order
to grab the customer attraction. Company needs to retain the
potential customers to exist the effective environment growth
(Park, LiPuma and Prange, 2015).

Changes in environment factors: This is the another threat and
challenge which may occur different challenging situations.
Environment is uncertain in nature they may change in constant
manner in any terms such as political changes, social changes,
legal changes, technological changes and environmental changes
(Rahman, Zailani and Musa, 2017). So these changes introduce
new challenge situations for the company.

New entrants: New entrants is the basic and commonly threat of
business specially in food industry. Such as it is the most
challenging situations for existing firms or organisation. New
entrants are comes with new ideas and innovative plans which
may challenging for the existing companies. On the other side,
new entrant companies provides services at low process to grab
the customer attraction. In that case customers more attract
towards the those organisations.

P3 Determine the advantages of international
trading blocs and agreements.
International trading blocs opportunity to the company to take its
business activities at international level. International trades are
the group of countries with a geographical region that protects
themselves from inputs form non-members (Rottig and Reus,
2018). These trading blocs remove all challenges or barriers of
trade in order to protect the business environment. There are
various advantages of international trade such as giving below:

Foreign direct investment: trade bloc helps to know about the
foreign direct investment. This helps to economic. On the other
side, creation of large market is been found which results in
lower cost of market.
Competition: Another advantage of international trade is that all
manufacturer of different countries come together and work
closely. It helps to increase the heavy competition in the market
between all those manufactures. It can say that heavy competition
in the market may increase the efficiency level of the companies.