GLOBAL BUSINESS IN CONTEXT ASSIGNMENT SAMPLE 2024
Introduction
Company background
Walker Logistics, as the name suggests is currently operating within the field of warehousing and logistics and it is a well-established organization that primarily handles the operations concerning fulfilment, warehousing and distribution. The company has been operating in a similar field over the last 20 years and have been able to gain significant insights regarding products, people and potential customers throughout the UK along with various parts of the European continent (Walker Logistics. 2022). The company presently has long-term contracts with over 50 clients within the UK and also globally within a variety of sectors who use the company’s services owing to their consumer-driven business model (Walker Logistics. 2022).
Justification for expanding
Any business expansion takes place as they want to capture a bigger market than it currently has which will enable the business to expand more and that will be a significantly beneficial aspect for their financial growth. It has already been mentioned that the country has several clients within Europe, however, Walker Logistics has not yet penetrated the Asian market with its full potential. Thus, the expansion toward it would be an advantageous aspect for the business since several Asian nations such as Bangladesh have significant business opportunities. Research has suggested that the country is flowing with unemployment and thus, by acquiring access to such business ventures the country will get to ensure robust industrialization, market and capital formation, innovation, increased Gross Domestic Products (GDP) and more (Chowdhury, 2017).
Section 2- Analysis of the external environment
It needs to be mentioned that the decision to expand to any given market is based on the external environmental analysis of that nation to evaluate whether or not the country is suitable for Foreign Direct Investment (FDI). The analysis concerning the external environment of Bangladesh will be conducted with the theoretical framework of the PESTLE analysis to determine its suitability for FDI.
From a political-legal aspect as FDI factor 1, it may be stated that the cabinet within the country is regarded as the collective decision-making body of the nation of the entire government under the governance of the prime minister within the people’s republic of Bangladesh.
By applying the benchmark framework, research has discovered that the public sector within the country is lacking in providing the best quality public services to its people and thus, strong governance and leadership are extremely crucial to maintain the political sustainability of the nation (Sarker et al., 2017). However, in December 2013 violent attacks broke out within the country owing to certain political instability and it became one of the most infamous events in history which led people to worry that Bangladesh might perhaps become similar to Pakistan in which the Islamist extremists threaten an entire state (Washingtonpost.com. 2022).
By complying with evidence found in research, it may be implied that the legal structure of the country is not quite robust which is evident by the kind of and volume of sexual violence that women are subjected to in Bangladesh (Banarjee, 2020). In addition to that, it has also come to light that as a relatively new democracy, triggered by long periods of military regulations, Bangladesh has been facing severe impediments owing to the prevailing system of mistrust, ineffective government institutions and constant manipulation regarding the elections (Zaman, 2017). Therefore, it may be implied that the legal structure of the country is required to improve to a great extent since there are significant legal obligations that the government of the country has failed to follow and it is also proven by the rank of Bangladesh concerning the corruption index.
The fundamental economic growth of the country as FDI factor 2, is dependent upon its agricultural sector and it has been discovered that although the share of growth regarding agriculture has significantly declined in the country, the contribution of the sector remains undisputable for Bangladesh compared to other sectors (Rahman, 2017).
On the other hand, another piece of literature has established that the impact of Covid-19 has been extremely negative for Bangladesh economically and especially, the rural areas of the country had suffered a lot due to several lockdowns and more (Malek et al., 2021).
From the aspects of trading, it needs to be mentioned that Bangladesh has quite an amicable trading relationship with major Asian nations such as China. Research suggests that the business association between both nations is improving quite rapidly within the contemporary time, which indicates that the country is acquiring a significant amount of investment from different nations (Sikder and Dou, 2020).
Additionally, the trading relationship between Bangladesh and the UK has also seen significant improvement as an increase of approximately 12.5% has been noticed between the nations which is an increase from the 4 quarters to the latter half of 2020 (Assets.publishing.service.gov.uk. 2022).
Figure 1: Growth of trading between Bangladesh and the UK over the years
(Source: Assets.publishing.service.gov.uk. 2022)
Moreover, according to the report of the world bank the country has maintained a significant track record concerning the country’s development and growth which has led the economy to grow by almost 6% every year and with that human development has also shown significant outcomes (Hussain and Haque, 2017).
The majority of the population within the country belongs to the Muslim faith and Bangladesh is home to one of the vastest Muslim populations within the South Asian region the country has seen an intense re-occurrence concerning the religious forces within its society (Islam and Saidul, 2018).
By drawing on Islamic Revivalism in the form of a theoretical construct the study has also discovered that the aspect of Islamization within the country was fundamentally initiated by the first-ever political regime of the nation to mobilize public support (Islam and Saidul, 2018).
Another social aspect that needs to be taken into account regarding the country’s external environment is that the economy of Bangladesh has shown significant resilience and urbanization is growing at a rapid speed, however, the rural areas of the country still have not seen a remarkable reduction in poverty (World Bank, 2019).
In addition, according to research, the government of Bangladesh is also investing and implementing different programmes that are associated with Human Resources such as education, technology, social welfare, culture, health and well-being and more to create efficient Human resources (Chowdhury et al., 2018). The corruption index of the country, however, is significantly high as it has been evident from the result that the country has ranked at 147th position out of the 180 countries and has a significantly low score, which is only 26 out of 100 (Transparency.org. 2022).
In the context of technology as a FDI factor 3, it may be stated that the aspect of technology is one of the most significant driving factors for the marginalized communities and the study has indicated that the relatively backward people are ready to use significant technological innovation in the country as it leads to a sense of well-being (Rahman et al., 2017).
Technologically, the country is attempting to attain remarkable growth and, in that regard, Bangladesh has increased its electricity generation of the country to approximately 12,261 MW, however, there is still a significant scarcity of electricity during the humid summer months (Baky et al., 2017).
On the other hand, the practice of online shopping has also emerged as a great market segment within Bangladesh thanks to technological adaptation and it is, specifically, popular amongst the youth, whereas the older generation in the country who are technologically challenged find the system quite complex (Chowdhury and Chowdhury, 2017). However, another piece of research has established that there is a significant concern regarding digital privacy in Bangladesh since people within marginalized communities such as Bangladesh use a single mobile device with multiple individuals (Ahmed et al., 2017).
Apart from that, environmentally, the country is also showing great improvement, however, research has stated that effective environmental policies such as plastic waste management in countries such as Bangladesh may be quite challenging due to lack of development in infrastructure, facilities and insignificant budget for such practices (Mourshedet al., 2017). Moreover, it has also been established that due to the lack of modern technology that is influenced by different socio-economic challenges, Bangladesh has also been lagging in conserving biomass energy which has the potential to become one of the biggest contributors to the global energy supply (Masud et al., 2019). Although, it needs to be mentioned that Bangladesh is attempting to increase their forest area by almost 20% within the next 15 years to maintain environmental sustainability (Un.org. 2022).
Section 3- Market entry mode
The market entry management of Walker Logistics Ltd in Bangladesh has to be good with the help of better management of the organisation on managing the development and better understanding of the sustenance of the products in the market depending on the economic conditions of the country. Furthermore, the FDI of Bangladesh was 16.9 billion dollars in 2019 which helped several investing countries such as the United States of America (USA) and the UK to invest in the country (State.gov. 2022).
The flow of the FDI of the country has been 0.53% which was quite lower than any other Asian country in the same year which provides the knowledge that the country is able to progress well in the global market (Refer to Appendix).
The FDI management of the country allows a good market for better trading of the company being a UK-based company and helps in the better expansion of the market of the organisation effectively. The export management of the country has been better and the country has experienced a 44.39 billion increase in the export of goods and services of the country in the global market (Data.worldbank.org. 2022).
The FDI policy management and even the export services of the country have provided the country with better investment from foreign nationals and have allowed the country to make better economic growth. Additionally, the exports of the country include clothing materials both raw and finished goods which are supplied in the European countries, especially in the UK and the USA which has provided the country to progress well (OEC. 2022).
The country’s both FDI policies and export management will help the company to flourish and as the company is a growing company the better management of the FDI policies of the organisation will provide the organisation to flourish well in the country. Export management is quite helpful although in expanding business management to a different country, the company has to look after the FDI policies more as it provides the country with better management. The organisation is able to manage better services in Bangladesh irrespective of the challenges and several cultural barriers the organisation may face which is possibly mitigated with better FDI management.
Section 4- Recommendations
Although the legal structure of the country is not the best and there are also some political tensions within Bangladesh, it has been proven that the nation has shown strong economic growth and resilience over the years which is one of the most significant reasons for the company to expand to Bangladesh. Moreover, it has also been derived from the above discussion that the government of Bangladesh is also implementing different programmes to enhance the capacity of human resources and the country is seeking the entrance of such businesses which will help them to improve their employment condition.
The government of Bangladesh should be able to provide Walter Logistics Ltd. with stable macroeconomic management and it should help in providing better growth for the firm. The company should help in providing better employment management in the country and it should help the country in developing better economies by providing better developmental success for the company.
Conclusion
From the above discussion, the FDI policies of the country help the company to flourish in the market and even allow the company to make better financial management with the help of effective technological development. Thus, the company being a logistics company with the help of effective policies management would be quite helpful for the organisation to progress in the new market without any kind of hindrances.
References
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Assets.publishing.service.gov.uk. 2022. [online] Available at: <https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/1091449/bangladesh-trade-and-investment-factsheet-2022-07-20.pdf> [Accessed 21 July 2022].
Baky, M.A.H., Rahman, M.M. and Islam, A.S., 2017. Development of renewable energy sector in Bangladesh: Current status and future potentials. Renewable and Sustainable Energy Reviews, 73, pp.1184-1197.
Banarjee, S., 2020. Identifying factors of sexual violence against women and protection of their rights in Bangladesh. Aggression and violent behavior, 52, p.101384.
Chowdhury, E.K. and Chowdhury, R., 2017. Online shopping in Bangladesh: a study on the motivational factors for ecommerce that influence shopper’s affirmative tendency towards online shopping. South Asian Journal of Marketing & Management Research, 7(4), pp.20-35.
Chowdhury, F.N., 2017. A study of entrepreneurship development in Bangladesh: Pros and cons. Journal of Asian Scientific Research, 7(1), pp.1-11.
Chowdhury, M.N.M., Uddin, M.J., Uddin, N. and Uddin, S., 2018. Human capital development and economic growth in Bangladesh. Journal of World Economic Research, 7(2), pp.52-63.
Data.worldbank.org. 2022. Exports of goods and services (current US$) – Bangladesh | Data. [online] Available at: <https://data.worldbank.org/indicator/NE.EXP.GNFS.CD?locations=BD> [Accessed 21 July 2022].
Hussain, M.E. and Haque, M., 2017. Empirical analysis of the relationship between money supply and per capita GDP growth rate in Bangladesh. Journal of Advances in Economics and Finance, 2(1), pp.54-66.
Islam, M.N. and Saidul Islam, M., 2018. Politics and Islamic revivalism in Bangladesh: The role of the state and non-state/non-political actors. Politics, Religion & Ideology, 19(3), pp.326-353.
Malek, M.A., Sonobe, T. and Truong, H.T., 2021. Changes in the rural economy in Bangladesh under COVID-19 lockdown measures: Evidence from a phone survey of Mahbub Hossain sample households.
Masud, M.H., Ananno, A.A., Arefin, A.M., Ahamed, R., Das, P. and Joardder, M.U., 2019. Perspective of biomass energy conversion in Bangladesh. Clean Technologies and Environmental Policy, 21(4), pp.719-731.
Mourshed, M., Masud, M.H., Rashid, F. and Joardder, M.U.H., 2017. Towards the effective plastic waste management in Bangladesh: a review. Environmental Science and Pollution Research, 24(35), pp.27021-27046.
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Rahman, S.A., Taghizadeh, S.K., Ramayah, T. and Alam, M.M.D., 2017. Technology acceptance among micro-entrepreneurs in marginalized social strata: The case of social innovation in Bangladesh. Technological Forecasting and Social Change, 118, pp.236-245.
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