Global Business Development + Driving Factors

Global business development

Global business development is a business interaction with global stakeholders to create long term relationships to generate business growth. It enables businesses to start operating internationally

Multinational Corporations (MNC)

A company that owns or controls production and service facilities in more than one country

Diversification (risk minimisation)

Expanding into multiple markets, industries or products to spread risk and reduce vulnerabilities to shock

Financial Growth Opportunities

Ways businesses increase revenue and profit globally, such as gaining access to new customers, lowering production costs, and benefiting from economies of scale

Loss Minimisation

A strategy to reduce potential risk by operating in multiple countries. It stabilises revenue by addressing seasonal demand and avoiding dependance on a single market

Spending Patterns

The frequency, timing and quantity of consumer purchases. Habits and routines that explain how and why consumers buy goods/services

Consumer Trends

Shifts in consumer behaviour and expectations that influence global markets, including demand for sustainability, online shopping, multiple payment options

Ethical/sustainable products

Goods designed with environmental and social responsibility in mind, meeting consumer demand for sustainable business practices

World Trade Organisation

An intergovernmental body that regulates global trade, ensure transparency, and resolves disputes. 166 members as of 2024

Regulations

Trade rules negotiated between member countries to ensure fair, predictable and transparent international trade

Sanctions

Trade penalties imposed by the WTO to enforce compliance with its rules

Financial Market

Any marketplace where buyers and sellers trade financial assets such as shares, loans and currencies

Deregulation of the Financial Market

The reduction of government rules and restrictions on financial institutions to allow freer movement of capital and increased competition

Financial growth/Loss minimisation - Advantages

Higher sales revenue from a larger customer base. Lower production costs. More stable revenue streams across seasons

Financial growth/Loss minimisation - Disadvantages

Higher set up/upfront cost. Exposure to foreign exchange risk. Political/economic instability in host countries

Financial growth/Loss minimisation - Impacts

Increases profitability - funds reinvested. Strengthens competitive advantage globally. Poorly managed - financial losses and reputational damage

Consumer purchasing/Spending patterns - Examples

Online shopping/e-commerce expand markets beyond borders. consumers expect ethical and sustainable products. New payment systems - apple pay, paypal, influencing spending behavious

Consumer purchasing/Spending patterns - Advantages

Businesses gain insights to tailor products globally. Demand for sustainable/ethical goods - opportunities for premium pricing. Digital products/services eliminates physical distribution costs

Consumer purchasing/Spending patterns - Disadvantages

Meeting diverse consumer demands increases cost/complexity. Failure to adapt - brand irrelevance. Ethical greenwashing - reputational risk

Consumer purchasing/Spending patterns - Impacts

Shapes feasibility of entering markets. Drives innovation and product adaptation. Creates pressure to maintain ethical practices

WTO - Advantages

Reduces barriers for businesses in member states. Provides dispute resolution. Ensures rules based trading - reduces uncertainty

WTO - Disadvantages

Compliance costs for businesses. Small businesses may struggle with complex WTO rules. Sanctions can disrupt markets

WTO - Impacts

Creates level playing field - better access to foreign markets. Forces compliance with international standards - increases legitimacy

Deregulation of the Financial Market - Explanation

Allows global businesses to move money across borders easier. Attracts foreign direct investment. Facilitates trade via easer loans, credit and banking services

Deregulation of the Financial Market - Advantages

Businesses access cheaper/more diverse capital sources. Increases competitiveness internationally. Encourages foreign investment into host economies

Deregulation of the Financial Market - Disadvantages

Exposes businesses to speculative risk. Less government oversight - higher chance of financial risk. Global shocks spread faster

Deregulation of the Financial Market - Impact

Improves cash flow for expansion. Reduces reliance on domestic capital market. Increases exposure to global financial risk