Essay
Essay business (unit 5 btec level 3)
- Module
- Business (UNIT5BTECLEVEL3)
- Institution
- AQA
level 3 btec assignment on international business.
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Yasmin CrabtreeUnit 5: International Business Assignment 1
Why trade internationally?
Learning A – Explore the international context for business operations.
A.P1 Explain why two businesses operate in contrasting international markets- Section One:
In this section, I will be introducing two businesses which operate in contrasting sectors and are based in Commented [ES1]: It would have been good to have se
more than one country. The two different British businesses I have selected to report on are BT and BP you explain what BP and BT stands for - giving their name
full.
in this section I will be talking about:
- The operation of each businesses
- The reasons each conducts businesses internationally.
- Types of finances available to each business
- A full analysis of the support which has been given to each of the business.
International trade allows countries to expand their markets and access goods and services that
otherwise may not have been available domestically. As a result of international trade, the market is
more competitive. This ultimately results in more competitive pricing and brings a cheaper product
home to the consumer. International trade is the exchange of goods and services between countries.
Trading globally gives consumers and countries the opportunity to be exposed to goods and services not
available in their own countries, or which would be more expensive domestically.
Section one- BP Oil
Starting in 1908 with the discovery of oil in Persia, BP has always been about transitions – from coal to Commented [ES2]: Good introduction.
oil, from oil to gas, from onshore to deep water, and now onwards towards a new mix of energy sources Commented [ES3]: What is Persia called today?
as the world moves into a lower carbon future. British petrochemical corporation that became one of
Commented [ES4]: This is a name - a proper nound an
the world’s largest oil companies through its merger with the Amoco Corporation of the United States in the name should have captial letters - good to see you
1998. BP was founded on April 14, 1909, as the Anglo-Persian Oil Company, Ltd. It was renamed the introducing the reader to the businesses name in full.
Anglo-Iranian Oil Company, Ltd., in 1935 and changed its name to the British Petroleum Company
Limited in 1954. The name British Petroleum Company PLC was adopted in 1982. After merging with
Amoco in 1998, the corporation took the name BP Amoco before assuming the name BP PLC in 2000.
The company’s headquarters are in London.
BP- Activity's
BP is a worldwide organization whose activities include refining, marketing, manufacturing, Commented [ES5]: This is the american version of the
transportation, trading and supply of crude oil, petrochemicals and petroleum products and operates in word organisation - please take care to make sure that yo
are not using americanisms.
Europe, north America, and Asia. It is a UK public limited company as well as BT whose shareholders
expects divided which means that they are expected to make a huge amount of profit annually. BP is Commented [ES6]: Proper noun - part of the full name
this country - needs a captial letter.
one of the world's leading international oil and gas companies based in London and they invest in
renewable energies. The business only sells lubricants such as gear oils, greases and engine oils, solvents Commented [ES7]: Singular - expect and I think the w
you should have used here is dividends. which means th
such as turpentine, fuels such as opal, BP ultimate, auto gas and diesel. They make their oil own land expect a share of the profits.
and on shore and according to them they move energy around the globe. They manufacture and market
Commented [ES8]: Do you not mean also... and not 'o
fuels and raw materials used in thousands of everyday products, from mobile phones to food packaging
this means that they make products used occasionally and so it is likely that they will get a high revenue Commented [ES9]: This sentence does not quite make
sense.
1
,Yasmin Crabtree
and profit. The business trades crude oil and gas products across their teams in Chicago, London and
Singapore. They are also a leading gas marketer in North America and within European, trading physical
and financial power. BP offer deep expertise in trading oil, they source barrels of oil from throughout Commented [ES10]: Again the sentence - the last part
the globe, and have unparalleled access to BP’s global assets, and through there network also source does not quite make sense.
barrels from other producers, which provides them with access to all the key crude grades. The Commented [ES11]: I don't know what this means - 'd
businesses gas and power business are a key part of their organization, with deep expertise in key expterise?
regions and products. They traded 4 billion barrels of oil in 2016, which is equivalent to 20% of global Commented [ES12]: Wrong there - should be their.
traded oil and we deliver enough oil each year to fuel 106 million car journeys around the equator. Commented [ES13]: missing word? 'they'
BP is in 58 countries, 6 continents which are America, Europe and Eurasia, Africa and middle east and Commented [ES14]: what are key crude grades?
Asia and the pacific. There are 25 operations in Europe and Eurasia such as the UK and Spain, 12 Commented [ES15]: Again 'americanism'
operations in Africa and the middle east such as Angola and south Africa, 5 operations in America such Commented [ES16]: do you not mean they? - has this
as Trinidad and Tobago and Canada and 12 operations in Asia and the pacific such as China and India. been cut and pasted? if it has then it is fine you must put
From this BP has businesses worldwide. into speech marks and mention that this was taken from
xyz....
British Petroleum developed oil fields and built refineries in several countries, including major interests
in Alaska’s Prudhoe Bay in the United States and in the United Kingdom’s sector of the North Sea, where Commented [ES17]: located?
British Petroleum made in 1965 the first commercial discovery of natural gas and in 1970 the first Commented [ES18]: Middle East - proper noun - capit
discovery of a major oil field. Beginning in 1970, BP merged its assets in the United States with those of please.
the Standard Oil Company (Ohio), in which BP acquired a controlling interest. Commented [ES19]: again proper noun
Bp Structure Commented [ES20]: Capitals for both letters please.
At bp, they provide heat, light and mobility to customers all over the world, with a purpose to reimagine Commented [ES21]: Proper Noun
energy for people and the planet and an ambition to be a net zero company by 2050 or sooner. With
offices in 22 locations covering the US, Canada, Mexico and Latin America, BP are a recognised industry
leader in the region. They have been providing energy price risk management for third parties since
1989. In fact, they were the first oil and gas major to register as a swap dealer. BP Energy Company Commented [ES22]: and what is a swap dealer?
(BPEC) became a provisionally registered swap dealer on July 29, 2013. There is London-based team their not they.
which is where they head office is, has provided energy price risk management products to customers
across a wide range of sectors in Europe and Africa for over 20 years, with their 2,500 service stations,
Aral is one of the most trusted brands in Germany and beyond. With access to BP’s expert team of
financial and physical traders, there team is uniquely positioned to help you manage your oil and gas Commented [ES23]: wrong there - should be their
price exposure. Eastern Hemisphere, thee deep understanding of both market sector and geographies Commented [ES24]: again wrong there - shoudl be the
allows them to offer customized solutions on simple paper, structured deals and physical energy to their
clients in over 30 jurisdictions from the east coast of Africa to the Pacific Islands. Products like bp Commented [ES25]: Capitals
gas/petrol stations, Fuel cards and credit cards, fuels cards, such as BP Plus, are used by individuals and
businesses around the world. Lubricants, bp and Castrol are leading manufacturer of motor oil and
lubricants.
There about 1.4 billion people in the world without electricity one of BPs aims is to move energy around
the globe, this means that by investing in energy they can help these people and make electricity easily
available to them. As they are predicted growth in energy in 2035 and they plan to do so by reducing
carbon emission, this means that around that time there is a high possibility that all these energies
would reach all parts of the world especially under-developed countries. Commented [ES26]: Good
Different types of markets
1
, Yasmin Crabtree
In market economies, there are a variety of different market systems that exist, depending on the
industry and the companies within that industry.
Perfect Competition with Infinite Buyers and Sellers- Perfect competition is a market system
characterized by many different buyers and sellers. In the classic theoretical definition of perfect
competition, there are an infinite number of buyers and sellers. With so many market players, it is
impossible for any one participant to alter the prevailing price in the market. If they attempt to do so,
buyers and sellers have infinite alternatives to pursue.
Monopoly with One Producer- A monopoly is the exact opposite form of market system as perfect
competition. In a pure monopoly, there is only one producer of a particular good or service, and
generally no reasonable substitute. In such a market system, the monopolist is able to charge whatever
price they wish due to the absence of competition, but their overall revenue will be limited by the ability
or willingness of customers to pay their price.
Oligopoly with a Handful of Producers- An oligopoly is similar in many ways to a monopoly. The primary
difference is that rather than having only one producer of a good or service, there are a handful of
producers, or at least a handful of producers that make up a dominant majority of the production in the
market system. While oligopolists do not have the same pricing power as monopolists, it is possible,
without diligent government regulation, that oligopolists will collude with one another to set prices in
the same way a monopolist would.
Monopolistic Competition with Numerous Competitors- Monopolistic competition is a type of market
system combining elements of a monopoly and perfect competition. Like a perfectly competitive market
system, there are numerous competitors in the market. The difference is that each competitor is
sufficiently differentiated from the others that some can charge greater prices than a perfectly
competitive firm. An example of monopolistic competition is the market for music. While there are
many artists, each artist is different and is not perfectly substitutable with another artist.
Monopsony with One Buyer- Market systems are not only differentiated according to the number of
suppliers in the market. They may also be differentiated according to the number of buyers. Whereas a
perfectly competitive market theoretically has an infinite number of buyers and sellers, a monopsony
has only one buyer for a particular good or service, giving that buyer significant power in determining
the price of the products produced.
Commented [ES27]: good
Their scientist and engineers recognize the urgency of climate challenge and they understand that Commented [ES28]: americanism
producing oil efficiently is essential to their success. They have new technologies to help produce more
oil more efficiently from existent resources. They also make their operations lower cost and more
sustainable to give people different choices of type of energy they want to use. As they deal with
countries in different markets such as developed, advanced emerging, secondary emerging and fronter
markets it is possible to meet their aims to move energy around the globe and to reduce carbon
emission with their new technologies. The advantages of BP being a developed country is that they get Commented [ES29]: missing word 'to'
hire people with the right skills to work with them, for example hiring experienced scientist with
different ideas and they also know the rules and procedures to trading and operating. This however
means that they will have competition with other worldwide companies such as Chevron. BP is also a
part of the emerging markets and has potential of increased sales due to undergoing fast economic Commented [ES30]: does not quite make sense
growth; this then means that the government will over incentives to them as they created new jobs for Commented [ES31]: governments?
the local community. However, emerging markets have unstable government, and any politics issues can
Commented [ES32]: political?
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