Tapping into New International Markets: Strategies for SMEs Growth

This report examines the strategies for small and medium-sized enterprises (SMEs) to tap into new international markets, focusing on Verdant Leisure’s expansion into Myanmar. It justifies the global concerns surrounding small and entrepreneurial businesses, including new industry conditions, technological advances, foreign acquisitions, and competition levels. The report analyzes the threats and opportunities SMEs face in a competitive global environment, such as timing issues, currency changes, distribution logistics, increased sales, and economies of scale. It also determines the advantages of international trading blocs and agreements, including foreign direct investment, competition, and market efficiency, referencing the Global Strategic Rivalry theory and barriers to entry. Finally, it explains tariff and non-tariff barriers, such as quotas, voluntary export restraints, subsidies, and administrative dealings, impacting international trade activities. Desklib provides access to similar solved assignments and study resources for students.

43 – Tapping into New and
International Markets (Pass
Criteria)

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Justify the global concern surroundings in which small and entrepreneurial businesses operate 1
Examine the warning and possibility that face SMEs in a progressively competitive global situation. 2
Determine and analyse the advantages of international trading blocs and agreements.........3
Explain the various tariff and non-tariff barriers that exist in the international trading environment. 4
TASK 2............................................................................................................................................6
Covered in brochure...............................................................................................................6
CONCLUSION................................................................................................................................6
References:.......................................................................................................................................7

INTRODUCTION
International business and marketing is defined as the process of applying several marketing factors for the purpose of
satisfying several of needs and requirements of people living in the several countries. Basically, it means to perform the marketing
activities in more than one country or across the world. Global marketing is another name of this marketing which include designing
of marketing mix globally along with making the strategies as per the taste and preferences of people of several regions. It is found as
the most important decision of business organisation to go globally or not. It also leads to the creation of brand value of business
organisation in international market. The chosen organisation for this report is Verdant leisure’s which is a tour and travelling
company (Rana, S and et. al., 2020). It is a small medium enterprise based in UK. This report deals with the concept of international
marketing along with their trade activities which leads to making the organisation more effective and successful. In addition to this, it
also includes how the business expand in other international market for the purpose of making goodwill in market. This company is
planning to expand their business in South-east Asia at Myanmar.
MAIN BODY
Justify the global concern surroundings in which small and entrepreneurial businesses operate
The global business enterprise can be defined as the social and task surrounding of an industry which have been affected by
international forces. Some of international forces include global competition, economic technological force, legal and political forces
and many more. New industry conditions: The existence of international system and connections are inclusive of needs and requirements of
buyers. The global nature of current enterprise and trade in international market. In the context of Verdant Leisure’s, it is
necessary for the management of organisation to know about the terms and conditions of target market. It helps them in
planning a good start in new market (Rindfleisch and Malter 2019).
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 Technical Advances: in order to making effective operations in the international market, it is required to use proper advance
technology as it will make the task easy and effective. Verdant Leisure’s is requiring to learn and develop the skills and
abilities so that the organisation can easily adapts the advance technologies which can make communication more easy and
effective among the customers and company. Acquisition from foreign: It has been found that all the foreign market has their creativity. Verdant Leisure’s is also requiring
to develop the abilities so that they can know about the norms of new market before starting operations in that specific market
(Peterson and Minton 2018). Level of competition: SME’s insight it beneficial to market internationally as those remark market has also been going into
by other premier situation with in the same industry. However, it can be seen that rivalry is one of the main running power
for organization and utility world.
 Appreciation and spiritual orientation: The industries such as Verdant Leisure’s faces several issues according to the
segment trends and religious. It has been found as necessary to know about all these factors when the organisation is planning
to go perform their operations in global market.
Examine the warning and possibility that face SMEs in a progressively competitive global situation.
Below mentioned are the several threats which are being faced by the enterprise in some global surroundings: Timing Issues: It represent a premier competition of organisation because all the markets have different time duration which
can be replaceable (Sheth, J.N., 2020). However, Verdant Leisure’s have to consider time as the major factor while starting its
business operations in South-east Asia. Currency Change: It has been found that the nature of prevalence marketplace is very violet and it is necessary to capable to
move constantly. Hence, it is necessary for Verdant Leisure’s to keep an eye on the changes in the values of currencies on the
stock exchange when the organisation is moving into the worldwide market (McLeay, Lichy and Asaad 2020).
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 Distribution and logistics issues: the organisations have to supply the finished goods to the customers by the use of several
logistics. It also works as threat for the business organisations. In the context of Verdant Leisure’s, this threat lies in searching
the correct economical carrier and freight towards providing services to the new customers.
Below mentioned are the opportunities of SME's in the global environment:
 Increase sales and profit: The main reason of expansion of any business organisation is earning higher profits by
increasing the sales of products and services into the global market. Verdant Leisure’s also have opportunity to increase
their earning. By performing business operations, the organisation can increase the income.
 Economics of scale: It is clear that the organisation working in domestic market work on a small scale. Whereas, the
organisations working in international or global market work on huge economic scale. The business organisation can also
save their costing by doing manufacturing on high scale and selling the products and services worldwide.
 Competition: Verdant Leisure’s will have caught with various organisations working in the same industry in global market.
All those organisations are considered as the competitors of organisation. Rivalry is considered as the major factor for
small business enterprise to market and function globally.
Determine and analyse the advantages of international trading blocs and agreements.
Trading Blocks:
It may have defined as the individuals of a particular region which leads to the control and promote the trade actions. It is
related to the business liberalization a trade creation among the several business units (Li and et. al., 2019). Since they are believing as
non-associate. Below mentioned are some illustrations: Preferential trade area: It is defined as the trading bloc which provide advantageous right to definite products from the
participating countries. It is possible only by decreasing tariffs but not through get rid of them properly. Along with this, it is
also considered as the initial stage of creating trade bloc.
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 Customs Union: It plays an important role in removing the duty obligation among the associate, advantageous the acceptance
of a incorporate external duty against non-associate. This unfastened a door for script as a united individual commerce bloc
and with other third persons also.
Below mentioned are some advantages of trade bloc: Foreign direct investment: It plays an important role in increasing the FDI in the country. Along with this, it also leads to
establishing the large markets for both suppliers and buyers as well which focus on reducing manufacturing costs. Competition: Higher the number of producers across the countries which result in the increase in the competition in the market
and it has been found that the maximization of competition results in the effective progress of overall country.
 Market Efficiency: Increasing the consumption experience along with the change in demand is required to provide higher
number of products and services to the market. It results in the development of effective market place.
There are several international trade theories that focus on explaining the trade patterns followed by the businesses in the
dynamic business environment. Global strategic Rivalry theory is one of the famous international trade theory emerged in 1980s that
aims on the MNCs and their efforts to attain the competitive advantage against the other global firms of the industry (What Is
International Trade Theory?2022). The Verdant Leisure’s a SME in UK will encounter global level competition in their respective
industry and in order develop and grow they must develop a significant competitive advantage. For the company the critical way to
obtain the sustainable competitive edge is called the barriers to entry for that industry. The barriers to entry refer to the obstacles a new
firm may face when trying to enter into an industry or new market. The barriers to entry that Verdant Leisure’s may seek to optimize
include:
 Research and development
 Intellectual property rights
 economies of scale.
 Unique business processes along with the extensive experience in the industry.
4

Explain the various tariff and non-tariff barriers that exist in the international trading environment.
Tariffs barriers:
Fees, custom duty, taxes applicable on the movement of products across the countries are the several factors include in the
tariffs barriers. These terms are defined as interchangeably. Furthermore, it has been divided into two tariffs i.e. import tariffs and
export tariffs. The host country is responsible for collecting formers which has been paid by the business organisations as it acts as
restriction in trade activities in a specified country (Kumar, S and et. al., 2021). Native country collects the export tariff from several
organisations which are majorly focusing on performing business operations in the global market. Only after the approval of both
countries to do the trading activities, tariff barriers be collected. It has been found that there are several materials which are not
permitted in host country. Hence, it can be said that the host country may be using different standards. Verdant Leisure’s is requiring
to consider them superior for paying the tariff for trading.
Non-Tariff Barriers:
The non-tax restrictions are considered as the main features of non-tariff barriers. It includes state trading and administrative
barriers. These can be found in the form of subsidies, quotes, embargo and many more.
 Quotas: These are considered as the limit of amount of quantity which is allowed to export and import. Many time, the
limit quantity of products has been mentioned in the licence.
 VER: The full form of VER is Voluntary Export Restraint. It is defined as a type of quota which have been fixed by the
native country on the request of host country. It is related with the maximum number of products which can be exported.
 Subsidies: It is defined as the financial assistance which have been provided to the local organisations by the host
government for the purpose of making it contend with the foreign organisations. It includes subsidised input price, tax
holiday, cash grant and many more.
Administration Dealing:
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It involve the rules and regulations which can control the flow of products through import and export (Kowalik, Danik and
Francioni 2020). It include custom tax payment, safety inspection, environment regulatory inspection and many more.
State Trading:
It has been found that the import export services and trading are being handled by several agencies. Hence, the policies
developed by them are different from each other which are based on the skilfulness and knowledge of these agencies. They have entire
knowledge of international trading as they are found as specialist in performing these activities. They are responsible for setting the
policies along with rules and regulations under the procedures of state trading.
TASK 2
Covered in brochure
6

7
Tapping into New and International Markets
Advantages and disadvantages of the different types of exporting processes for exporting
merchandising and services
Imports can be defined as the process under which goods and services are being
purchased by the people resident of foreign countries. Resident include the businesses, citizens
along with the government of country.
Goods and services sent by email, by shipping or carried personally comes under imports. It has
been analysed that mainly the government of a country import raw material or the products
which are not available in the domestic market.
If the amount of import increases, it may result in the trade deficit of country as the government
of country need large amount of money for the purpose of paying for the exceeding imports.
Export refers to the procedure under which the products and services are being
produced in a country and they are purchased by another country. All those products and
services which travel from domestic country to the foreign country.
Export is considered as an element of international or global trade. The trade balance of a
country can be presented by the export and import. Trade surplus can be measured in the case of
large number of exports in a particular country.
Advantages of importing and exporting for Verdant Leisure’s
 It leads to the increase in the market place of organisation which also re4sult in the
increment in the income of company.
 It also results in the improvement and growth of ability of the business organisation in
the market.
 Importing and exporting allow the business organisation in tapping the worldwide
resources and investment.
 A huge amount of documentation is involved in the process of importing and
exporting.
Disadvantages of importing and exporting for the Verdant Leisure’s
 It has been found that huge amount of investment is require by the business
organisation for the purpose of starting importing and exporting in the international
market.
 Due to the involvement of foreign currencies, export and import payments are the
major issues.
 A huge amount of documentation is involved in the process of importing and
The Verdant Leisure’s is requiring to do proper planning of procedures which they are going to
follow while doing export and import. Along with this, it has been analysed that the
documentation and permissions in import and export plays an important role.
Hence, it is required to company to follow the documents and get permission to perform these
functions. In order to smoothly performing the business functions in international market, business
organisation should have proper investment and financial resources.
In order to secure the deal, the SMEs are recommended to make the connections or partnership
with the larger firms that are stable and sustainable in market from long run. This will help the
SMEs in securing their position in the international market. Either, SMEs can plan to open a new
venture in the abroad to understand the new market from scratch. This will help the company to
gain its own new market coverage and customer base.
Explain the differences between merchandise and service imports and exports
Good export and import Service export and import
It includes the import and export of the
tangible products which can be touched and
seen.
It involve the import and export of the services
which are intangible by feature and they can
only be felt but not seen.
It involves the huge number of transactions
having the less value as compare to the
export and import of services.
The import and export of services include a few
number of transactions which involve high
values.
It is easy to manage the import and export of
goods. Hence, high number of organisations
are doing trade.
It involves high risk and investment as compare
to the import and export of goods. Hence, it
involves less number of firms.
The storing and conserving the goods is
easy.
It is not possible to store the services as it is
variable in nature.

8
Evaluate the various methods in which SMEs can tap into international markets.
Franchising: It can be defined as a vertical relationship among two business
organisations which are commonly known as franchisor and franchisee. This relationship has
been based on a contract signed by the two companies, under which the franchisor sells goods
and services proved by the franchisee having trade mark or any business entity ways. Verdant
Leisure’s is requiring to follow several strict rules and regulations for the purpose of suing
franchising as an entry tool in the new market. It is necessary for organisation to maintain the
quality and goodwill of the organisation, so that they can face the inauspicious condition.
Licensing: It is defined as the agreement under which a party permits the right to
another party to use their intangible assets for a particular time period. Verdant Leisure’s can use
this type of entry tool for entering in the international market when they don't want to do trade
with the involvement of high risk and cost of entering into the market of the host country. It is
really helpful method for the business organisation as it helps the firm in avoiding the capital of
production in abroad.
Joint Ventures: It is defined as the entity which have been formed by the two or more
than two independent organisations working together. If Verdant Leisure’s want to do the
business as joint venture, they are required to agree on sharing the revenues along with the cost
of organisation
Comparison and opposition the different structure SMEs can tap into international markets,
assessing the pros and cons of each method.
Global joint venture versus strategic alliance -
It refers to the relation jointly of two or more than two interests from apart enact to speech root,
share risks and conflict individual from a joint venture. Whereas strategic alliance on the other
is a worldwide or territorial strategical content, but they stay self-autonomous subsequently
alliance agreement and they share created by the strategical operations. The joint ventures are
the form in which small businesses partnership with the global large-scale business or with other
SMEs in order to grow or expand business. Where as in the strategic alliance the SMEs only
partnership with other firm to gain the benefit of the other firm’s strategies.
Similarities -
Joint ventures and strategic alliances allows involvement with twin ability to welfare from one
another ability and core competency. They are similar in technology producing and mercantile
real estate evolution and whenever a company want to spread out its sales or transaction into a
global normality.
Differences -
In a joint venture the association first and invest in a new institution that collectively
unowned by both of the parent companies whereas a strategical alliance is a judicial statement
among two or more respective to share entree to their mechanization, hallmark or other stock list.

9
Franchising versus licensing :
Similarity -
Both documents definite quantity that the franchise license make defrayal to the primary
concern and that brand. Franchising is the most popular and rapid form of entering into the new
market for the SMEs as they are direct gateway to enter new market, acquire new customers. On
the other hand, in licensing the are some restriction in starting a business as it comprises of legal
laws.
Differences -
In agreement there is perpetually a close tie or bond among the franchising and there is
good relationship among the parties. It can also be said that the franchise is only one a drawn-
out part of the Verdant Leisure’s. It provides training and also support to the other one.
CONCLUSION
It has been concluded from the above report that the international business environment
comprises of surroundings in which the international business organisations are performing their
business operations. It has been found as important for the management of business organisations
to work on the factors which may affect the business operations. As per the above discussion, it
has been identified that Verdant Leisure’s is planning to expand their businesses in south-east
Asia in Myanmar. In order to increase the revenue of organisation along with providing their
services globally, they are required to open their outlets in several locations. This report is stating
the strategies related to the expansion of Verdant Leisure’s. It is necessary for the business
organisation to analyse the trade rules before expanding business. This industry has capability of
providing job opportunities to the local vendors. Along with this, this report also includes the
discussion of importance and advantages of trading blocs in the context of global market. Several
of tariff and non-tariff barriers have been elaborated. The expansion of business also involves the
requirement of high investment along with documents and permission letters for the purpose of
smooth functioning of operations in international market.
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 Gbadamosi, A., 2019. Contemporary issues in marketing: Principles and practice. Sage.
 Katsikeas, C.S., 2018. Special Issue on the Future of International Marketing: Trends,
Developments, and Directions. Journal of International Marketing. 26(1). pp.1-3.'
 Kowalik, I., Danik, L. and Francioni, B., 2020. Specialized marketing capabilities and
foreign expansion of the international new ventures. Journal of Small Business
Management, pp.1-39.
 Kumar, S and et. al., 2021. Past, present and future of bank marketing: a bibliometric
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