International Business Assignment Sample

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Introduction

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International trade is regarded as the lifeblood of the Morden business world. Producers from diverse countries seek profit by extending the market, rather than by selling just inside their own borders (Lacka, Chan, and Wang, 2020). In order to diversify their economies and get access to goods and services that are not available in their own countries, countries may benefit from international commerce. Due to international trade, the market is more competitive. As a consequence, the product is now much more competitively priced and accessible to the end customer. Globalisation of commerce immediately helps the economy by accelerating growth, raising living standards, and creating new economic possibilities. On the flipside, not all nations have reaped the benefits of globalisation equally. As a result, the following paper compares and contrasts two businesses, namely Tesco and Amazon.

Operations of each company

Operations of Tesco:

Tesco’s manufacturing efforts are geared around providing a service to its customers. Since services and goods are given via operations, duties like opening every day, cleaning shelves, and stocking the shelves might be the second upstream opportunity (Coe, Lee, and Wood, 2017). If Tesco wants to maintain a competitive edge in the future, it could look at increasing its hours of operation in areas where they are currently limited that includes home delivery of products or adding more Metro and Express locations. Legal or planning council restrictions, on the other hand, might make this an impractical strategy.

In other words, Tesco’s customers are price-conscious people who are interested in deals and appreciate variety.

Tesco is organised in a top-down approach. Positions and responsibilities are broken down into two categories in this model.

Operations of Amazon:

Amazon’s human resources department makes use of both in-house hiring procedures and outside staffing firms. In warehouses and fulfilment centres, for example, personnel from these organizations fill temporary employment and are examined to determine their fitness for permanent positions.

Online shopping giant Amazon aims to target the 18-44-year-olds who own computers or smart devices in 2022. 60 percent of Amazon’s clientele are Americans, who wish to shop online due to the obvious ease, quickness, and inexpensive pricing (Caraway, 2020). 

This means that a product or business is given to a specialised team instead of a function like marketing, product development, or technology. Amazon.com, Inc. has a well-defined organisational structure. The interactions among the various parts of the organisation are based on the company’s business activities, which are the primary emphasis of this structure. Amazon is a great example of a hierarchical organisation because of its size. The corporation, which is the world’s biggest online retailer, presently employs over 560,000 people worldwide. As a result of Amazon’s organisational structure, all of the company’s workers answer to Jeff Bezos, the company’s founder and CEO.

Reason each company conducts business internationally

Throughout Europe and Asia, Tesco has opened up shop in a dozen countries in the previous decade. In all, Tesco Lotus operates 2,000 supermarkets in Thailand and the Philippines, which it is selling to Thai giant CP Group. Just a few examples are Turkey, Thailand, and China, where over half of Tesco’s selling area is currently situated. Expanding globally was Tesco’s strategy for long-term growth and success. As the biggest retailer in the United Kingdom, Tesco intended to expand their business by bringing their existing popular items to other nations. Because Tesco’s brand is so well-known, they sought to take advantage of it by sponsoring shows in other countries, such as the fourth season of Downton Abbey in 2017(SPARKS, 2018). As of 2017, Poland is the EU’s fastest-growing nation, making it simpler for Tesco to open a store there. With Rolls Royce and BP among its holdings, Tesco is among the major shareholders. Exporting and importing goods between Poland and the UK is also a breeze, thanks to Poland’s proximity to Eastern Europe’s rising markets and the size of its own home market. Tariffs on goods entering and leaving Poland. The fact that Poland’s economy grew by 3% between 2017 and 2019, according to the World Bank, is an advantage of doing business there. There would be a rise in demand from developing economies and an increase in output, as a result of this.

In 1998, Amazon started selling computer games and music, following Bezos’ basic business concept. Around the same time, Amazon bought other online bookshops in the UK and Germany, allowing it to broaden its reach throughout the globe (Zhu and Liu, 2018). To put it another way, Amazon is the undisputed king of selling globally while providing a local shopping experience via the use of local expertise, language, and advice provided by its staff members.

Sources of finances available or each company

“Retained earnings, long-term and medium-term debt capital market offerings, bank borrowings, and leases” are all methods used by the Tesco Group to support its operations.

The “Amazon Rewards Visa Card”, the “Amazon Prime Rewards Signature Visa”, the “Amazon Store Card”, and the “Amazon Secured Card” all provide financing alternatives for Amazon customers (Caraway, 2020). An applicant’s credit limit is determined by a variety of criteria, including their credit score.

Evaluation on the role of trading blocs on international trading

Listed below are the functions and significance of trading blocs:

International commerce has benefited from the formation of trading blocs. What follows is an explanation for this:

1. Economic integration:

Economic integration has come from the creation of trading blocs. Economic integration in a region like SAARC, OPEC, ASEAN, EU, etc., is represented by this term (Coe, Lee, and Wood, 2017). “The creation of trading blocs integrates the economies of various countries and brings them closer together”.

To improve regional cooperation and interdependence, trading blocs may be a useful tool. It draws the country together by bringing together the economies of the various countries in the group and facilitating economic interaction among them.

2. Free transfer of resources:

Tariff and non-tariff barriers may be eliminated via trading blocs, which enable the free movement of resources across the borders of member nations. This aids in the most efficient use of the resources at hand.

No nation in the world has adequate resources to meet its own needs, thus they rely on each other for assistance.

3. Increase in Trade:

The free flow of resources aids in the growth of member states’ production. In order to promote free trade, they abolish trade restrictions (SPARKS, 2018). Trade earnings rise as a consequence of the increased import and export operations of member countries.

To ensure long-term economic development, trading blocs are solid and efficient. The purpose of trade blocs is to encourage trading partners to acquire and sell domestically produced products. It also promotes scale savings.

4. Employment opportunities:

Direct and indirect job growth is a direct and indirect result of large-scale manufacturing and distribution. This leads in a rise in the quality of life of the economy as a whole.

The member nations of trading blocs tend to see a growth in their national incomes and employment levels. To increase the number of people employed, more money is needed. Natural, human, and capital resources are efficiently used when trading blocs are in place to provide job possibilities.

Key features of globalisation that affects each business

Tesco, one of the world’s largest retailers, had a poor start to its globalisation efforts. In the long run, Tesco began limiting the locations of its shops and the products they sold to the global markets. In 1999, it established a joint venture with a well-known local store, Samsung, in South Korea.

While, in Amazon’s case, Customers may purchase and sell products on Amazon, which is a major retail company. The positive influence on Amazon is immeasurable. By market capitalization, Amazon is now the 56th-largest firm in the United States (Lacka, Chan and Wang, 2020). Amazon has created a reputation for themselves as one of the major retailers in the country, ranked 15th. As a result of these chances, Amazon has grown significantly, and they may continue to do so in the future.

Analysis on the prospects of support that are available to each

Additionally, Tesco was able to acquire the best possible shop sites thanks to the joint venture. Under the well-known ‘Home Plus’ name, Tesco started operating in the nation. Customers in Korea like Tesco’s shops to be smaller, and the company has brought in some of its best practises from elsewhere (Caraway, 2020). Nevertheless, Today, “Tesco has 13 countries in its corporate empire, which gives it access to over 3 billion people, or around 54% of the world’s population, owing to the internet”. The procedure has progressed so rapidly as a result of technological advancements such.

While thanks to its size and dominance in the online retail market, Amazon.com has a leg up on its competitors Amazon has gone to the top of the list of most innovative companies despite having just one division. Because of this company’s unique ideas and its customers’ ideas for expansion, it has grown to this fortitude (Zhu and Liu, 2018). Amazon has kept up with the times by introducing Prime, a membership-based service that allows customers to buy and get their purchases more rapidly. As a result of the Amazon, this firm has been able to sustain itself financially.

Evaluation on the impact of globalisation on the business in the last 5-10 years

After Wal-Mart, TESCO is the second-largest retailer in the world. Following an ambitious overseas growth plan towards America, South Korea, Eastern Europe and China has been its policy in the last 5 years. It is able to keep its product prices low since it purchases in large quantities and obtains its items from all around the world. Managing the supply chain properly and efficiently saves a significant amount of money. Customers who use the company’s rewards card to make purchases have their information collected (Hameed, 2021). After then, the information is put to good use in the form of discounts and savings on a wide variety of items. As a result, clients become more loyal, and targeted promotions may be created. “Using this technology, TESCO has been able to gain a significant number of clients and maintain its position as a market leader in the UK”.

According to Tesco’s last 5 year’s data, “the company has 6,784 shops globally and employs more than 500,000 people. That means it is the world’s biggest food provider. www.tesco.com is a subsidiary of the company that provides internet services. Metro, Express, Superstore, and Extra are four of the company’s four banners in the UK market. About 40,000 food, clothes, and non-food items are sold by the firm”. In addition, the firm manufactures own-label products that are divided into three levels: basic, value, and superior (Kwon, 2019). In addition to this, Tesco operates a number of gas stations and has established itself as one of the country’s most significant independent fuel sellers.

Conclusion

To sum up, it can be stated that It’s possible that Tesco, in order to remain competitive in the future, would consider expanding its hours of operation in sectors where they are now constrained, such as home delivery. With just one division, Amazon has risen to the top of the list of the most creative firms in the world today. As a result of the company’s original concepts and the growth ideas of its clients, it has developed to this level of tenacity (Zhu and Liu, 2018). To keep up with the trends, Amazon introduced Prime, a membership-based programme that enables users to buy and get their items faster. This company was able to stay afloat thanks to Amazon.