Expanding into New and International Markets: A Business Report

This report delves into the strategies for Warburton Building Services to tap into new and international markets. It begins by describing the global business environment, particularly for small and entrepreneurial businesses, and analyzes the threats and opportunities they face. The report then explores the advantages of international trading, evaluating tariff and non-tariff barriers. It further examines the advantages and disadvantages of importing and exporting, differentiating between merchandise and service trade. Finally, the report evaluates various methods SMEs can use to enter international markets, comparing and contrasting different approaches for effective market penetration. The PESTEL analysis is applied to evaluate the external factors impacting the company's operations and growth potential in the international market. The report concludes with a strategic overview and recommendations for successful international expansion.

Tapping into New and
International Markets
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Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
P1 Description of global business environment in which small and entrepreneurial businesses
are operating...........................................................................................................................3
P2 Threats and opportunities faced by SME's in this competitive global environment.........5
TASK 2............................................................................................................................................6
P3 Describe the advantages of international trading..............................................................6
P4 Evaluate various tariff and non-tariff barriers which take place in the international trading
environment............................................................................................................................7
TASK 3............................................................................................................................................8
P5 Explain the advantages and disadvantages of importing and exporting...........................8
P6 Explain the difference between merchandise and service imports and exports................9
TASK 4..........................................................................................................................................10
P7 Evaluate various methods which SME's can consider whiling tapping into international
market...................................................................................................................................10
P8 Compare and contrast the various ways in which SME's can tap into international market.
..............................................................................................................................................11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................14
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INTRODUCTION
International marketing is a wide concept which is based on many principles and its
primary objective is to satisfy the needs and demand of customers across the globe. The
companies entering into international market have to consider various factors and have to take
actions according to the rules of government and the needs of customers (Liu and. et. al., 2019).
A market is referred to the place where two parties gather in order to proceed the process of
exchange of goods and services. In addition to this international market facilitates the exchange
of goods and services across the national boundaries and it is used to get tap into the new and the
international market along with the business aim that targets to achieve the higher market share,
profit and sales. This report is based on Warburton Building Services as it is based on the
modern offices and warehouses in order to offer suitable electrical and mechanical services
regarding the maintenance of developing overall industry. Moreover, company was established
in 1979 in UK to make sure the effective standards for the suitable service by its qualified
engineers. The company is providing effective services such as plumbing, heating and electrical
engineers. The topics covered in the report are description of global business environment,
threats and opportunities for the firms that is increasing in the global environment, advantages of
the trading blocs for the company, analysis of the importing and exporting process. Moreover, it
includes the way for the SMEs for tapping into the international market.
TASK 1
P1 Description of global business environment in which small and entrepreneurial businesses are
operating.
Global business environment is defined as the process in which organisation considers
the environment of various countries in which they are operating and identifies various factors
which are different as it has direct impact on the decision making process. The main focus of the
business organisation is on effective use of resources by considering the internal and external
environment (Steiner and Fan, 2019). In the context of the small business organisations they are
contributing effectively in the global business by generating employment opportunities and by
increasing their profit and revenue margins. The SMEs business has performed its operations at
the small scale along with the less coverage area of the market. The small business of the UK has
comprises the number of employees that is less than 50 and generated the annual revenue of less
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the 10 pounds. The entrepreneurial ventures and small business has provided the huge support
and contribution to the UK government, as there are over 98% of the business which are covered
by the small business. SMEs has done the maximum exports all the around the Europe as after
the impact of the Brexit transportation cost has been reduces so now they have to pay less and
gain more profits along with the growth in the larger market area.
SMEs are those organisations who maintain prominent revenues and assets as they tends
to offer suitable kind of category which relies on the number of characteristics. SMEs are
important for the economy considering the development and growth that offer prominent
employment opportunities and open new market area for them. They also create an effective
group for the talented and skilled manpower to support future business expansion in market.
(Source: Contribution of SME, 2019)
In context of the Warburton Building Services the PESTEL analysis will help in
evaluating the situation of global business environment. Political factor- This factor plays important role in the carrying the business operations
in the effective and efficient manner. In context of Warburton Building Services they are
operating in UK and is able to established its brand name in UK market. The company is
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Illustration
1: Contribution of SME, 2019

focusing on expanding its business where it will require more employees to carry its
operations effectively. Hence it will help government by generating employment
opportunities. Furthermore, in order to deal with the prominent situation of the political
parties in regard of government intervenes in overall economy. For this, the political
issues which can impact Warburton Building Services include taxation policy of UK,
suitable level of bureaucracy, foreign trade policy, small business funding and many
more that leads to impact the expansion of an organisation (Ram and Liu, 2019).
Currently, company opt local power structure as they tends to deal at the domestic level
and to expand at the international level it leads to negatively impact the performance of
Warburton Building Services. Economical factor- This factor covers wage rate, employment rate, inflation rate, etc.
which has direct impact on the working of Warburton Building Services. In UK the wage
rates and the inflation rate are quite low hence Warburton Building Services has greater
opportunity to expand its business in international marketplace. These factors are
concerned with the effective performance of the economy that leads to impact the
operations of SMEs and decision making of company (Minkman and van Buuren, 2019).
By undertaking the pandemic, it leads to bring economical crisis in whole world that
leads to negatively impact the operations of Warburton Building Services. To overcome
from this factor, respective company conduct market research in order to mitigate risk
factor. Social factor- These factors are influence by the latest trend in the marketplace and has
direct impact on the performance of the company. In context of Warburton Building
Services, they are able to serve UK market effective as they have proper knowledge
about the market and the latest trends. For business expansion they need to study the
market and the latest trends of the country in which they want to enter (Vézina, Selma
and Malo, 2019). In regard of this, there are several socio-economic factors that leads to
impact the overall performance of Warburton Building Services by effectively examining
the ethical condition of UK, cultural and other demographic factors that leads to impact
the overall demand for the small products and services and its suitable operations. By
considering the cultural factors of UK Warburton Building Services need to undertake
strategic formulation and also tends to respond over operations according to the success
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strategy. For this, Warburton Building Services improving support for the renewable
energy can impact the operational efficiency as it is a threat for Warburton Building
Services. Technological factors- In context of Warburton Building Services they are dealing in
electrical engineering and are using latest technology with the motive to deliver effective
services to its potential customers. They are providing quality products based on latest
technology to attract more number of new customers. These factors leads to impact the
functioning of Warburton Building Services and their products and services within the
market. It is useful for the owner of small business in order to evaluate the prominent
status of current business environment that can become opportunity for them (Fforde,
2019). In relation with this, enhancing the adoption of digital technology can become
opportunity for respective company and make things easier regarding the payment and
digitalisation that can positively impact the operational efficiency of Warburton Building
Services. Legal factors- In context of Warburton Building Services they are providing services in
UK market where government is having various laws, rules and regulation which are
effectively followed by the business organisation. Hence in the process of business
expansion it will be able to function according to the rules and regulation of the country
in which they are planning to enter (Dwyer and Vongvisouk, 2019). For this, it
undertakes the suitable rules and regulations that can impact the overall performance of
small businesses regarding the operations and profitability of Warburton Building
Services. For this,Warburton Building Services must have proper reach of its intellectual
property protection laws in terms of making online presence that can become opportunity
for company for their operational efficiency.
 Environmental factors- In context of Warburton Building Services it is focusing on
sustainable development, hence carrying its activities and task by considering
environment. They are using less plastic with the motive to control the level of pollution.
This factor tends to undertake the overall environmental factors that leads to impact the
functioning of Warburton Building Services within the suitable sector including the
tourism, farming, climate and many more. Here, respective company need to take
initiatives to preserve oil resources in order to grow global energy consumption that can
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further become opportunity for Warburton Building Services and put positive impact on
the operational efficiency of company.
From the above PESTEL analysis it has been identified that Warburton Building Services
is doing quite good in UK market and is capable to expand its business in international market.
Hence, it is being analysed that the framework is helpful in order to identify risk factors for the
small businesses and also tends to analyse ways to overcome these factors in order to have
smooth expansion in market.
P2 Threats and opportunities faced by SME's in this competitive global environment.
In context of SME their main focus should be on expanding its business in those areas of
international market which has less competition and is growing fast (Steiner and Fan, 2019). In
context of Warburton Building Services they are dealing in services from quite long time and has
the ability to expand its business in international marketplace.
The threats which are faced by Warburton Building Services are as follow-
 Experience level- The major threat which Warburton Building Services might face in
international market is due to no prior experience working in the new market. Hence they
don't know their trends and how to handle the problems or issues taking place in the new
business environment (Wang, Helms and Li, 2020). They have to spend more time in
understanding the market and the nature of customers before entering into new business
environment.
 High competition- There are many business organisations which are operating in
international marketplace and has able to establish its brand name in marketplace (Majid,
2019). In context of Warburton Building Services they are having many competitors in
market, hence it is essential for them to formulate effective marketing strategies in order
to obtain desire results.
 Political factor- Every country has set of different rules and regulation and for
Warburton Building Services it will be difficult to function as they have to make changes
in its existing system according to the rules and polices of the different countries in which
they want to established its business.
In the international market, there are some opportunities which are present and
Warburton Building Services must focus on them that can increase its revenue and profits.
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 New and innovative product- In context of Warburton Building Services they have to
focus on producing new and innovative products in order to attract more number of
customers (Milburn and Guertin-Martin, 2020). As people are preferring innovative and
unique products hence it will help the organisation to effectively established its business
in new marketplace. Rebates and subsidiary provided by government- Warburton building services must
focus on expanding its business in those countries in which rebates and relief is provided
from government side. As this will help the company in expanding and growing its
business in other parts that is in new marketplace.
 Keeping up in market: It depict that company tends to make suitable update regarding
the identification of changes that occur in market and also leads to analyse them
effectively (Jancenelle, Javalgi and Cavusgil, 2018). It also become opportunity for the
small businesses which is helpful to mitigate risk to take decisions by considering the
businesses and advanced information.
TASK 2
P3 Describe the advantages of international trading.
Trading bloc refer as the trade agreement between different countries government where
support is been provided by government that is trade barriers are reduced so that interstate and
inter country trades are carried in effective manner. Trading bloc is the type of intergovernmental
agreement which is the part of regional intergovernmental organisation in which regional barriers
to the international trade tends to get eliminated among the suitable states (Jancenelle, Javalgi
and Cavusgil, 2018). For this, various types of trading blocs are discussed as: Free trade area: In this, the members of trade union tends to eliminate the trade barriers
including tariffs among themselves. They also tend to maintain their own tariffs with the
non-members. In this, all the members are quite free for the import and export of
products and services and also maintain independent policy at the time of dealing with
other organisations (Wang, Helms and Li, 2020). Customs Union: In this, the other member of countries does not tend to eliminate the
internal trade barriers and also leads to opt common policies in terms of dealing with the
non-member countries. Here, the countries who consider custom unions tends to get
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agree in terms of eliminating restrictions for the movement of suitable factors including
people and finance. Common market: Here, the members leads to reduce internal trade barriers in order to
opt common external trade barriers and also permit for the free movement of resources.
For instance, labour of various countries by considering their common market (Ram and
Liu, 2019). Preferential trade area: In these areas they tend to have the lowest level of commitment
regarding the elimination of trade barriers. For this, the members lower down the trade
barriers and does not eliminate the barriers among them (Liu and. et. al., 2019). It leads to
undertake the suitable agreement that does not address that how a single member can deal
with those people who are not the member of trade union.
Advantages of trade blocs and agreements: Catch-up effects: Countries who tends to join the suitable trading bloc is beneficial from
the viewpoint of inward investment and leads to enhance trade opportunities (Tuan,
Thanh and Le Tuan, 2019). For this, Eastern European countries tends to make
considerable progress to catch up with the average income level in western Europe. Foreign Direct investment: Here, the investors of Warburton Building Services tends to
keep adding capital for the expansion of local industries and develop domestic
businesses. Higher Competition: The prominent elimination of tariffs leads to create suitable choice
for their customers as domestic organisations have great incentive in terms of cutting cost
which is helpful for SMEs to remain competitive in market (Minkman and van Buuren,
2019).
Disadvantages of trade blocs and agreements: Job outsourcing: Eliminating tariffs tends to allow Warburton Building Services for the
expansion to the other organisation. Moreover, without tariffs, imports from other
countries with low cost leads to eliminate living cost as well (Ram and Liu, 2019). It also
leads to make things difficult to compete with other industries by reducing workforce. Natural resources exploitation: Emerging market does not have various environmental
protection as free trade tends to develop depletion of minerals and other natural
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resources. By considering the background and functioning of respective company, they
tends to exploit natural resources that can become barrier for company.
 Reduces tax revenues: Most of the small organisations tends to face struggle in terms of
replacing revenues which are lost from the import tariffs and its fees (Xie and Li, 2018).
As the member of country is no longer subject for the import taxes because they need to
undertake new method to compensate to eliminate tax revenues.
P4 Evaluate various tariff and non-tariff barriers which take place in the international trading
environment.
There are various set of tariff and non-tariff barriers which take place in the international
trading environment with the motive to look after the goods which are being exported and
imported. Many companies import goods at possible low price and on the other hand some
countries are charging different type of taxes with the motive to provide benefit to the exporting
company (Vézina, Selma and Malo, 2019). Moreover non-tariff barriers are those by which
government tries to restrict the trades (Fforde, 2019). These are the legislative tax which are
imposed by the government on trades. Many countries are using this on frequent based with the
motive to restrict the trade for effective implementation of political and economic strategies. In
context of Warburton Building Services they have to focus on tariff barriers as it has direct
impact on the performance of the organisation.
Tariff barriers: These barriers lead to undertake certain imports that leads to increase the
price of imported commodities in order to make import less competitive of the small
organisations. As these are the government induced restrictions over the international trade
(Jancenelle, Javalgi and Cavusgil, 2018). In relation with Warburton Building Services, few
chemical which is imported by company tends to face tariff barriers.
Non-tariff barriers: These barriers undertake suitable rules and regulations that leads to
make trade more difficult (Dwyer and Vongvisouk, 2019). As it is the better way to restrict trade
by using trade barriers in the suitable form of tariff. As it includes various barriers like: Quotas: Most of the countries tends to issue quotas in regard of importing and exporting
the products. For this, countries tend to get agree over the specified limit for suitable
commodities which is being allowed for importation of country (Liu and. et. al., 2019).
Furthermore, Warburton Building Services need quotas in terms of having international
presence by developing trading licensing agreements.
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 Voluntary export restraints: It is used by exporting countries as it leads to set limit over
the number of goods and services as the specific country tends to export for the particular
country as these are based on the political alliances and availability. Subsidies: It is used by the domestic manufacturer or probably by small organisations in
order to eliminate the domestic cost and limit their imports (Kuppuswamy and Bayus,
2018). In relation with Warburton Building Services, currently they are dealing at
domestic level and for them subsides is suitable factor that leads to reduce additional cost
by limiting the imports of company.
 Embargoes: These are used when the countries tend to ban the trade for the specified
products and services with the another country (Wang, Helms and Li, 2020). For this,
government tends to take suitable measure in order to support for the particular political
or economic goals. In terms of Warburton Building Services, the harmful products which
are banned by the government can relies under this barrier.
Export and import duty- This is a type of tariff barrier in which taxes are been imposed
by the government on the export and import of products. The main earning from export are from
agricultural products and minerals. Whereas import duties also play important role as it is
implemented by countries with the motive to safe guard its trade activities (Vézina, Selma and
Malo, 2019). Many countries charge high on import duties such as Nepal, India, etc. In context
of Warburton Building Services, it can consider these countries and have to understand there
working nature.
License- This is one of the most common non-tariff barriers through which the main
focus of the government is to regulate the imported goods. By issuing license government give
the permission to carry the import and export activities on specific goods for a certain period of
time (Fforde, 2019). In context of Warburton Building Services they are not involved in import
and export services, hence they should take license for working effectively in the international
marketplace.
TASK 3
P5 Explain the advantages and disadvantages of importing and exporting.
Import and export activities play important role in the business environment as its
contribution is high in increasing the profit and sale margin of the business organisation.
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Importing and exporting depict the foreign trade as it being carried out for suitable products and
services that undertake exports, imports and balance over the foreign trade. For this, exporting
depict the selling of products and services from the domestic country to the foreign nation
(Steiner and Fan, 2019). Meanwhile, importing depict the purchase of foreign commodities in
order to bring them to the home country (Ram and Liu, 2019).
Advantages of export
 By exporting goods Warburton Building Services would able to expand its business and
it will help in overcoming the dependency on UK market. It will help in increasing the
reach in the market and also help in increasing the brand image of the business in the
marketplace (Liow, Liao and Huang, 2018).
 By increasing the export activities, the company need to increase its production and able
to get benefit from economies of scale (Kuppuswamy and Bayus, 2018). In context of
Warburton Building Services they are dealing in plumbing, heating and electrical services
where they are having advantage of low per unit cost as it is helping in expanding the
business of company.
Disadvantages of export
 Exactly when associations import their product and thing it will come as a triumph for the
close by creator similarly with the imported items the idea of the thing augmentation and
simply couple of people will buy the things from neighbourhood producer (Vézina,
Selma and Malo, 2019). So Warburton Building Service moreover need to think about
these close by creators.
 At the point when organization imports their crude material from outside it will
straightforwardly or in a roundabout way will hurt the cash and the economy of the
organization. To defeat this public authority will eventually build the duty so the import
can be confined and the money won't need to endure. Warburton Building Service should
look in this issue prior to trading so they don't hurt the cash and the economy of the
nation
 Secure the arrangement – For making sure about the arrangement the Warburton Building
Service need to do different examination like which organization do they pick, they need
to pick a grounded brand so they will get a generally settled piece of the overall industry
and they likewise need to choose the organization who is having high value (Minkman
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