Drivers for Global Entry: Expansion to Chinese Market
Overview
In this course, you have explored the elements of a market profile, including cultural, political, and economic aspects, and looked at the legal and regulatory market considerations. In this milestone, you will complete the next part of your course project by creating a market profile for your chosen country and creating legal and regulatory considerations.
Scenario
You are a business analyst working at a small, domestic organization that produces high-quality cell phone cases. Your organization has begun to see its sales flatten in the domestic market. While the organization is not losing money, leadership would like to explore options to continue to grow. One option that leadership has noticed competitors attempting is entering international markets.
You have been asked to examine the benefits, drawbacks, and key considerations for your organization to enter one of the global markets below, and summarize your findings in a business brief for leadership.
Continue to use your selected market from Milestone One. As a reminder, the options for international markets are:
Argentina
Brazil
China
India
Indonesia
Japan
Nigeria
Russia
South Africa
Turkey
If you would like to use another country for your final project please reach out to your instructor.
Prompt
In this milestone, you will continue to use the Business Brief Template (located in the Guidelines for Submission section of this document). Complete Section Two and the Legal and Regulatory Considerations portion of Section Three. Use course resources as well as the INT 220 Library Guide to support your responses.
https://libguides(dot)snhu(dot)edu/c.php?g=1044019&p=7631444&preview=c998261849cda3380ea440815a7f770d
Specifically, you must address the following rubric criteria:
Market Profile: Explore and explain the cultural, political, and economic environment of your selected market to help inform future business decisions regarding expansion from the domestic market.
Cultural Profile: Compare and contrast important cultural elements of your selected market against those in the domestic market, including communication, dimensions of culture, attitudes, common business etiquette and practices, and at least five other important aspects of culture.
Political and Economic Profile: Compare and contrast important political and economic factors for your selected market against those in the domestic market, including political systems and ideologies, current leaders, economic measures or characteristics used in classification, and government intervention on trade.
Market Considerations: Discuss the legal and regulatory considerations in your selected market that can impact business decisions regarding expansion to new global markets. You should also consider corporate social responsibility for each market consideration.
Legal and Regulatory Considerations: Compare and contrast important legal and regulatory requirements of your selected market against those in the domestic market, including trade restrictions, regulations of products or services, legal processes for business transactions, and import restrictions or documentation.
Guidelines for Submission
Template: Business Brief
Submit the template as a 500- to 650-word Microsoft Word document. Based on your milestones, you should have Sections One and Two completed, as well as the Legal and Regulatory Considerations portion of Section Three. Sources should be cited according to APA style.
You did the first business brief and wanted to see if you would do the next one. Attached is what was done on Milestone 1
Complete this template by replacing the bracketed text with the relevant information.
Section One: Drivers for Global Entry
Purpose of Global Expansion
Notably, the biggest advantage that a domestic organization gains from entering international markets is gaining access to a new market for its products. To this end, the organization's expansion in China will offer access to a large market given China’s high population and the number of individuals who own smartphones in the country (GrandView Research, 2022). In addition to access to a new market, entry into China would place the organization in a position where it can access other East Asian countries.
Moreover, an expansion into the Chinese market would offer an opportunity for the organization to cut costs on production. To this end, the organization shall explore China as a potential option for the production of the phone case as the company will be already operating in the country. Further, expansion into China will offer the organization a competitive advantage. To this end, the organization will gain new customers, human resources, and new opportunities that will enable the organization to outpace the competition.
Business Impacts of Global Business
The international expansion will affect the operations of the organization. To this end, the company will have to consider its Chinese customers when developing strategic plans, mapping the supply chain, and developing a marketing plan. Notably, entry into the Chinese market will have a positive influence on tax and compliance as the organization will invest heavily in understanding the taxing and regulatory policies in China. In addition, the expansion will improve the talent acquisition process, as the organization will be able to consider both domestic and foreign talent when recruiting employees. Conversely, the organization should be aware that expansion into China would result in potential challenges with HR and payroll management owing to the likelihood of potential new employment regulations and differing compliance requirements (Irwin, 2020).
Societal Impacts on Global Business
As a whole, the global expansion of business has had a significant impact on society. The large business that has expanded their reach globally have become enmeshed in societies within which they operate, with their effects being felt by the society. On the one hand, global expansion of business has contributed to the prosperity of the societies within which they operate by providing employment opportunities (Brouthers, 2020). In some instances, some large multinationals implement projects that directly improve the welfare of society as a whole. On the other hand, global businesses have been criticized for their single-minded pursuit of profits to levels that threaten societal welfare. In addition, global businesses have been credited with the spread of imperialism, especially in societies that are underdeveloped.
Cultural Considerations for Global Business
Before entry into Chinese markets, the organization has to research the culture. The organization should be aware that a significant language and cultural barrier exists between the United States and China. Irwin (2020) notes that Chinese culture can be described as the opposite pole of American culture. For example, Chinese society values community and tends to take a long-term orientation in decision-making. Comparatively, the United States places a higher value on individualism and adopts short-term orientation when making decisions. Thus, the organization has to be fully aware of the cultural and language barrier that it has to confront when expanding into China.
Section Two: Market Profile
Cultural Profile
Category
United States
China
Commonly Spoken Languages
English
Mandarin
Commonly Practiced Religions
Christianity
Buddhism and Folk religions
Power Distance Index (PDI)
40
80
Individualism Versus Collectivism (IDV)
91
20
Masculinity Versus Femininity (MAS)
62
66
Uncertainty Avoidance Index (UAI)
46
40
Long-Term Orientation Versus Short-Term Normative Orientation (LTO)
29
118
Indulgence Versus Restraint (IVR)
68
24
While the commonly spoken language spoken in the US is English, Chinese largely communicate in Mandarin. Chinese Buddhism is the most commonly practiced religion in China, while the United States practices Christianity. Except for masculinity versus femininity and uncertainty a...