BU7412 International Business Assignment Sample

Introduction

International business is linked with trading goods and services, capital, knowledge, and technology from one nation to another. It is connected with cross-border transactions on a global scale (Kabakova and Plaksenkov, 2018).http://BU7412 International Business Assignment Sample

According to David (2019), there are many external business environment factors like socio-culture, political, economic, financial, and environmental factors that influence the operations of the organization.

The UK tends to have a constitutional monarchy that is based upon parliamentary democracy. According to Jensen and Snaith (2016), the political factors observed in the UK impact the business environment in both positive and negative ways.

The political business environment has improved in the UK, which has resulted in political stability due to the existence of the rule of law and effective implementation of government policies (Eniola and Entebang, 2015).http://BU7412 International Business Assignment Sample

Furthermore, this stands to be a positive factor when observed in the context of forming Allies and Associates for maintaining business relations globally. However, the administrative sector is effective due to the constitutional monarchy pattern in existence (Schaffer, 2019). http://BU7412 International Business Assignment Sample

There is a vast number of government policies such as the Health and Safety at Work Act 1974, Equal Pay Act 1970, Employment Protection Act 1978, Sex Discrimination Act 1975, Sale and Supply of Goods Act, Trade Union and Labour Relations (Consolidation) Act 1992, Consumer Credit Act, and Employment Rights Act 1996 which helps the organization to carry out business smoothly at an international level.

The present essay discussed the context of the political environment and the UK’s government policies in order to identify the influence of business in negative and positive ways.

The report provides knowledge and understanding of the political environment of the UK and discusses the kind of approaches used by the administration to support businesses.

The essay also includes some challenges and issues for the business within the country, and it also consists of some contemporary issues. Further, it will provide recommendations to the government regarding the most significant problems in the UK.

Main Body

Political factors can influence the business’s working as it affects the market environment (Van Aelst et. al. 2017). http://BU7412 International Business Assignment SampleGovernments tend to play a high degree of power over the business as stable government policies can positively impact the company and vice versa.

The passing of government legislation can directly or indirectly influence the business opportunities of the company. The political business environment is an unpredictable element.

The political environment involves several factors like the existing political party of the country, degree of politicization of industry & trade, the effectiveness of the current legal framework, the current government, government policies, the public attitude towards the economy, corruption level, bureaucracy, trade control, and many more.

These political factors can significantly affect the business as it affects the economy, changes in regulation, mitigation of risk, and political stability or instability. For example, if an organization like ASDA does not amend its legal framework as per the amendments made by the country’s administration for supporting the country’s economy, it would thereby contribute towards a negative impact.

There are large numbers of approaches taken by the government to support the business environments, such as the government providing tax reliefs and discounts on resources for supporting businesses.

The other example for the adopted approach would be friendly trade policies like import quotas, and tariffs can be reduced, which helps in encouraging foreign trade.

The constitution of the UK is based on parliamentary democracy. The Government of the UK establishes several rules and regulations to support the business environment. The government amended the Taxation policies, which highly affects the cost of the business.

For instance, a rise in the corporation tax leads to an increase in cost to TESCO’s business, impacting it negatively (Williams and Grant, 2018).http://BU7412 International Business Assignment Sample All business organizations under each sector need to adhere to taxation policies levied by the administrative authorities of the country.

The Consumer Credit Act helps in protecting consumers when they borrow money or buy products on credit. It is helpful for businesses as it provides protection to the consumers if defective products are given to them. The same can be highly observed at Datalink Electronics Ltd., where protection to the consumers can be provided in case of delivery of defective products.

 The Health and Safety at Work Act, 1974, tends to affect the business as it helps protect the well-being of employees within the company and helps businesses assess any potential risk and identify hazards. Many well-established organizations and even SME’s have an implementation of this act under their company policies as well, such as Google, Unilever, Oak Cash and Credit Ltd., and many more.

This helps in taking proper action to mitigate such risks in a timely manner (Matti and Zhou, 2017).http://BU7412 International Business Assignment Sample Equal Pay Act 1970 helps provide equal pay to the men and women who work at the same level within the organization. Legal precedents over the companies such as Ford, ASDA, and many more This helps the business in prohibiting discrimination among the employees in terms of contractual pay and other conditions of employment.

Trade Union and Labour Relations are helpful for the business in improving the communication among employers and employees and negotiating other conditions associated with employment. This can be observed Scottish Trade Union, British Medical Association, and many more.

It has been observed that there are numerous issues and challenges faced by businesses in the UK. The contemporary issues underlying the UK’s market are due to the grievous impacts of COVID-19. It has tremendously affected the companies and the economy of the UK (Bhattacharjee and Lisauskaite, 2020). http://BU7412 International Business Assignment SampleAn increase in post-referendum inflation is the biggest example of it.

It leads to the weaker pound is, and it stands as the biggest challenge faced by the business within the UK recently. Fall in the pound has resulted in inflation which eventually increases import costs and affects strategic and operational business plans (Bernanke and Woodford, 2019). http://BU7412 International Business Assignment Sample

Also, recently the rise in the interest rates is another challenging issue faced by businesses in the UK, which leads to various other financial problems faced by the business organizations. Brexit is one of the critical contemporary issues faced by companies in the UK. Brexit has a positive impact, which means that there will be a lower degree of restrictions on firms by European lawmakers (Kabakova and Plaksenkov, 2018).http://BU7412 International Business Assignment Sample

On the contrary, the negative impact of Brexit is that there seems to be a loss of trade among the European customers. Also, the rise in the National Living Wage has increased the operating cost of the business and tends to affect the business profits (UNITED KINGDOM: ECONOMIC AND POLITICAL OUTLINE, 2020).http://BU7412 International Business Assignment Sample Many established organization such as Brewdog and Ford has been impacted it.

Conclusion and Recommendation

It has been summarized that international business is linked with cross-border transactions on a global scale. These political factors can significantly affect the company as it affects the economy, changes in regulation, mitigation of risk, and political stability or instability (Bhattacharjee and Lisauskaite, 2020).http://BU7412 International Business Assignment Sample

The rise in the interest rates, rise in the National Living Wage, Increase in post-referendum inflation, and Brexit is the key challenging issues faced by the businesses in the UK.

Here are some recommendations for the government that will be helpful for the enhancement of business productivity:

• Implementation of the legislation and policies stands to be a major issue (Halbert and Ingulli, 2020).http://BU7412 International Business Assignment Sample The government must focus on amending existing laws in order to make regulations more favourable for employees.
• The government must administer various laws favourable for the business and smoothens international business transactions (Swyngedouw, 2018).http://BU7412 International Business Assignment Sample
• The financial impacts observed over the business environment are the major challenge faced by UK (Bernanke and Woodford, 2019). http://BU7412 International Business Assignment SampleIt is recommended that the government must lower tax rates and increase loans and grants for effective business operations, and aids in a reduction in financial burden
• Simplifying regulations and creating duty drawback schemes for increasing international trade could be a sound recommendation to support UK’s business environment.

References

Books and Journals

Bernanke, BS and Woodford, M., (2019). The inflation-targeting debate. University of Chicago Press.

Bhattacharjee, A. and Lisauskaite, E., (2020). Covid-19 impacts on destitution in the UK. National Institute Economic Review, 253, pp.R77-R85.

David, J., (2019). PESTEL analysis of the UK. Retrieved October, 30, p.2019.

Eniola, A.A. and Entebang, H., (2015). Government policy and performance of small and medium business management. International Journal of Academic Research in Business and Social Sciences, 5(2), pp.237-248.

Halbert, T. and Ingulli, E., (2020). Law and ethics in the business environment. Cengage Learning.

Jensen, M.D. and Snaith, H., (2016). When politics prevails: the political economy of a Brexit. Journal of European Public Policy, 23(9), pp.1302-1310.

Kabakova, O. and Plaksenkov, E., (2018). Analysis of factors affecting financial inclusion: Ecosystem view. Journal of business Research, 89, pp.198-205.

Matti, J. and Zhou, Y., (2017). The political economy of Brexit: explaining the vote. Applied Economics Letters, 24(16), pp.1131-1134.

Schaffer, B., (2019). The administrative factor: Papers in organization, politics and development. Routledge.

Swyngedouw, E., (2018). Promises of the political: Insurgent cities in a post-political environment. MIT Press.

Van Aelst, P., Strömbäck, J., Aalberg, T., Esser, F., De Vreese, C., Matthes, J., Hopmann, D., Salgado, S., Hubé, N., Stępińska, A. and Papathanassopoulos, S., (2017). Political communication in a high-choice media environment: a challenge for democracy?. Annals of the International Communication Association, 41(1), pp.3-27.

Williams, K. and Grant, J., (2018). A comparative review of how the policy and procedures to assess research impact evolved in Australia and the UK. Research Evaluation, 27(2), pp.93-105.

Online

UNITED KINGDOM: ECONOMIC AND POLITICAL OUTLINE. (2020). [ONLINE]. Available through< https://santandertrade.com/en/portal/analyse-markets/united-kingdom/economic-political-outline >