International business is the trade of goods, capital, technology, services, and goods across national borders on a large scale. It involves crossing of border to reach more countries for international production of goods and services such as finance, banking, construction, and insurance. This process of exchange of goods and services internationally is also known as globalization. Separate national markets have been developed to bridge business at a global level. The two types of factors are responsible for underlining the trend of globalization, first is barriers to cross borders and the second one is technological change that is particularly done by transportation, communication, and information processing. In this essay, we will critically analyze and present the international business concept with the help of three articles as provided for assessment. The articles taken are Every Starbucks growth strategy is working by Danielle Weiner Borner on CNN Business, Why there is almost no Starbucks in Australia on CNBC, and the third one is Amazon Global Logistics Technology on YouTube channel.
According to these three articles, the international business concept involves the exchange of goods and services across borders. The economic transactions are made through skills, capital, people, and production of services and goods such as finance, banking, construction, and insurance at the international level. It is the process of multinational enterprises that are operating worldwide and approaching many markets through production. Starbucks and Amazon are the two multinational enterprises amongst General Motors, McDonald's, Microsoft, Ford Motor Company, and many others. Some companies like LG, Sony, Samsung, Exxon Mobil, and British Petroleum are also many other international leaders. Both enterprises differ with their activities in the market from production to consumption. Three phases are there in which international business operates and they are called as International Operations of National Firms (Rammal & Zurbruegg, 2016).
The financial investment by different firms like Starbucks and Amazon follows neoclassical theory where the capital movement is the difference of interest rates. They produce and invest their money in Foreign Direct Investment (FDI). Management of portfolio is done to have control over operations in abroad countries. Starbucks is selling its products by collaborating with Nestle to form the connections and sell its products at a larger scale (Schaltegger, Burritt & Petersen, 2017). The internationalization and standing of location and ownership in economics is the part of direct investment. In Australia, Starbucks is operated and affected by societal and physical factors in the competitive world. Both companies have expanded their market globally with a common goal to increase their economic values by developing strategies, lowering costs, increasing value, and profits (Tian, 2016).
Starbucks and Amazon are both the leaders of the business market knowing their potential and difference in legal, political, economical, accounting, labor, environmental, local cultures, foreign exchange markets, tariffs, imports, regulations, and accounting. These factors make difference and a connection with the countries to operate largely. Starbucks was the company that was founded in 1971 with international growth. It is the biggest coffee company that leads the industry with innovation and sustainability (Mathews, Bianchi, Perks, Chen & Glavas, 2015). The external factors define and monitor the environment to analyze within the remote and macro environment. Despite negative forces affecting the company, but then also negative forces impact the business. Regional integration and government support of the markets is the opportunity for Starbucks as well as Amazon for reaching to its customers (Lamberton & Ashton-Hay, 2015).
The infrastructure of different countries such as Australia is improving so Starbucks has the opportunity to develop its business. The rates of unemployment are declining so Starbucks has the opportunity to generate more revenue from markets across the world. However, the labor costs in the country are rising so it may have a threat to the company. Starbucks can increase its demand in the specialty by widening its array to attract health-conscious consumers to cafes. The mobile purchase systems are the opportunity for Starbucks to improve its links through mobile purchases. One major threat to the company in terms of technology is the availability of home-use specialty coffee machines. Corporate Social Responsibility is the opportunity for Starbucks to offer more products in recyclable packaging. The company must operate and satisfy its customers by following safety regulations on ingredients from Genetically Modified Organisms (GMOs).
Amazon is expanding its markets at global levels through e-commerce business. The company has to face large competition from competitors such as Walmart. Because of political stability in the country, Amazon has the opportunity to diversify and expand the business. Some of the external factors are responsible for continuing expansion in the relevant market. Amazon should look after the opportunities so that resilience could be increased in the remote environment of the information technology and commerce industry. Economic stability is not there in Australia, so expansion and development should be considered an increase in the likelihood of success for Amazon. The disposable incomes are rising in the country so according to the market scenario financial performance can be improved. The socio-cultural trend of the company has to lead the company with online retailing and the provision of information technology services and goods. Wealth disparity is a threat to Amazon in Australia in terms of expansion. However, consumerism and online habits are increasing in Australia, so these are opportunities for Amazon. The company has opportunities to improve its performance based on IT resource efficiencies.
According to the reports, I had seen that Starbucks is accelerating growth and aggressively opening restaurants to improve the technology. The sales of the company grew 8.1% to an all-time high of $6.8 billion. Due to improvement in the financial outlook for the year the success is determined to scale up strategic priorities. Starbucks knows about the reward program and methods to attract more members. The result has been showing in the reports as it has helped in building manpower with a 14% increase and reached 17.2 million altogether. The company is partnering with Nestle to launch more lines in coffee. Already, Starbucks has gained its popularity in the United States and China, Australia can be the next country if they look after opportunities and market expansion strategies (Hoye, Smith, Nicholson & Stewart, 2015). Home delivery is the option that attracts more customers and enhances sales, so Starbucks is collaborating with Uber to eat in the United States and this same procedure could be followed by the company to set up its business and expand the market by competing with competitors. Australians are deep in love with coffee so Starbucks can give a thrive to develop its business.
Amazon being the leading market contributor to online product delivery provides easy access to more information than before. The process has been made by Amazon very easily as the item gets ordered by tapping on the button within a few seconds. The reviews prices, retailer information, and stock everything is seen by the customer. The availability and shipment of stock are available for pickup and more (Fan, Cui, Li & Zhu, 2016). Hence, it has empowered customer phenomenon by broadening its industry and offer packages to customers. Amazon is constantly improving its logistics network by data and logistics stock maintenance and e-commerce. Hence, Amazon is competing with its competitors and fulfilling goods to gain customer attraction.
Digital literacy is the term that is used to describe reading and writing skills to receive and communicate the information. It includes everything from reading on a Kindle to gauging the validity of the website or creating and sharing YouTube videos. Information and communication are used to evaluate, create, find, and inform the cognitive and technical skills. Companies like Amazon and Starbucks should focus on three buckets such as finding and consuming digital content, creating digital content, and communicating or sharing it. The additional skills are required to contain hyperlinks, audio, graphics, interactive images, clips, and videos on a web page. Blogs, tweets, emails, and other forms of media such as podcasts and videos are to be written and uploaded using digital literacy. Digital content creation deals with a creative and collaborative process that involves experimentation and risk-taking. The tools should be social, participatory, easy to use, and collaborative in creating online communities (Bailey, 2017).
Hence, from this essay, I had learned that Amazon and Starbucks are both leading companies that have well developed international business growth. Starbucks has a supportive political, economical, legal, technological, and environmental support from Australia so it can expand its business. The only threat is of competitors from which the company is facing challenges in expansion. The two articles of Starbucks have a well-supported data presentation on market expansion. Another hand, Amazon is the leading product online delivery site that works for customer satisfaction and profit earning.
Bailey, M. (2017). Absorptive capacity, international business knowledge transfer, and local adaptation: establishing discount department stores in Australia. Australian Economic History Review, 57(2), 194-216.
Fan, D., Cui, L., Li, Y., & Zhu, C. J. (2016). Localized learning by emerging multinational enterprises in developed host countries: A fuzzy-set analysis of Chinese foreign direct investment in Australia. International Business Review, 25(1), 187-203.
Hoye, R., Smith, A. C., Nicholson, M., & Stewart, B. (2015). Sport management: principles and applications. Routledge.
Lamberton, G., & Ashton-Hay, S. (2015). Preparing Chinese international business students for the transition to undergraduate study in Australia. Journal of Research in International Education, 14(2), 155-171.
Mathews, S. W., Bianchi, C., Perks, K., Chen, H. L., & Glavas, C. (2015). The impact of Internet marketing capabilities on international network capability, a cross country study comparison between Australia, Chile, and Taiwan internationalized SMEs.
Rammal, H. G., & Zurbruegg, R. (2016). Awareness of Islamic banking products among Muslims: The case of Australia. In Islamic Finance (pp. 141-156). Palgrave Macmillan, Cham.
Schaltegger, S., Burritt, R., & Petersen, H. (2017). An introduction to corporate environmental management: Striving for sustainability. Routledge.
Tian, X. (2016). Managing an international business in China. Cambridge University Press.
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