100% satisfaction guarantee Immediately available after payment Both online and in PDF No strings attached
logo-home
Previously searched by you
Previously searched by you
logo
External factors and cultural differences £8.19
Add to cart
Quickly navigate to
Preview
  2.  
  3. PEARSON (PEARSON)
  4.  
  5. BTEC Level 3 National Extended Diploma In Business
  6.  
  7. International business

Essay

External factors and cultural differences
 1 purchase

This document has an in depth analysis of the Body Shop and what problems to communication, cultural differences and external factors they face when operating on an international level.

Preview 3 out of 18  pages

Document information

  • February 19, 2022
  • 18
  • 2021/2022
  • Essay
  • Unknown
  • A

Subjects

Written for

All documents for this subject (1)

Seller

avatar-seller
ellafairchild16

Reviews received

Content preview

External factors and cultural differences


The Body Shop was established in 1976. A British company that was founded by Anita Roddick.

It started out as a business just for Anita to make a living. The Body Shop is an international limited
British cosmetic, skin care and perfume company. The company stands out amongst others as they
are very CSR friendly and follow many strong rules from day one of operation.

The company originally started trading in Brighton and is now based in London and Littlehampton in
West Sussex. The company was owned by L’Oréal from 2006 until 2017. In 2017 L’Oréal was sold to
Natura for £880 million. The company sells thousands of products in over 3,000 stores in more than
65 countries and is now owned by a Brazilian cosmetic company called Natura.

The company specialises in ethically sourced, cruelty-free, and natural ingredients. None of the
products are tested on animals and ingredients were sourced directly from suppliers.

The shop started selling with 25 products. The products started out as a refillable bottle policy as she
didn’t have enough money to afford many different bottles to fill up with her products. All labels
were had written and relied on local press for advertisement.

The business started to expand through franchising and by 1984 the business had 128 stores
internationally. By 1994 89% of the business locations were franchises.

The business went public in 1984 and was floated on the London
stock exchange with shares starting at 95p. Roddick kept 27.6%
of the shares in the business. Share prices then increased
dramatically with prices of shares rising 10944% in the first 8
years.

The UK began trading with the United States in 1988 with all
new stores being company owned until 1990.

Throughout the 80s and 90s the company joined in in several campaigns relating to CSR and
environmental issues. They included ‘Trade Not Aid’ campaigns in 1987. The company also made
alliances with Greenpeace and Amnesty International, (human rights for prisoners of conscience).


The Body Shops community trade programme launched in 1987 to give them a fair price for natural
ingredients. These ingredients include Brazil nut oil, sesame seed oil, honey, and shea butter. The
company now works with 31 suppliers in over 23 different countries helping 25,000 people a year.

The Body Shop interestingly does not export its products to China because of their cosmetic animal
testing regulation. However, The Body Shop has always sourced many baskets and other products
needed (not cosmetic) products from China.

Task 1 (P5, P6, M3, D2)

P5: Explain the external factors that influence a selected business considering trading
internationally.

There are many factors that will affect a business when wanting to trade internationally. I will list
and explain these below in a PESTLE analysis. Pestle analysis is an external analysis of the external
environment for a business. This is good for a business to analyse risk or reward of an idea and all
things they should look out for and be aware of.

, External factors and cultural differences


Many companies operate internationally and operate their goods and services across boarders for
many different reasons and should carry out internal and external analysis of the risks they may face.
Internal factors can usually be controlled by the certain business.

How it affects countries internationally.

Pestle stands for:

 Political
 Economic
 Social
 Technological
 Legal
 Environmental

Political factors affecting a business that wants to go international

There are many political factors that will affect a business when wanting to go international. For
example, changes in tax rates, new rules, and regulations (especially in uncertain covid times),
political stability of a country, trade regulations such as tariffs, quotas ext.

A political drawback for a business when wanting to trade internationally could be trade restrictions.
This means a business may not be able to expand in that country as it is unwanted from the
government and not encouraged.

Economic factors

Businesses must look at how economic factors relate to the economics of a country and how things
like inflation, Interest rates, income rates and employment levels will directly impact a business.

Social factors

Social factors will include, education, trends, society, consumer behaviour, demand for certain
goods/services, culture, and lifestyles.

Technological factors

Technology can have both positive and negative impacts on businesses. Due to the change in
technology, a lot of new things have been made possible such as communication internationally is
faster, and more efficient. Technology can greatly impact efficiency within a business. Technology
can also be seen as a disadvantage due to high demand of different products and services and may
not even be allowed in certain countries such as China.

Legal factors

A business must be aware of the legal environment and what they are getting themselves into.
Different laws apply in different counties these laws must be abided even if not the same as the
origin country the business started in. These laws relate to age, disability, wage rates, employment,
and many other laws such as bans on certain products or services in that country.

Environmental factors

The effects of an environment on businesses can affect the way in which it operates. For example,
weather, climate change and temperature will have an impact on a business. If the climate in which
a business operates in is warm and sunny, products and services will have to support this otherwise

, External factors and cultural differences


no profit would be made. There is no point operating a hat, scarf, and glove company in a hot
environment. It simply wouldn’t work, and a business would be making a huge loss leading to failure.

A company must also move forwards with being more CSR friendly and support global matters and
help move forwards with change rather than adding to the problem.

Current environmental problems include:

 Global warming
 Climate change
 Food waste
 Biodiversity Loss
 Plastic Pollution
 Deforestation
 Air Pollution
 Fossil fuels
 Melting ice caps and rising sea levels
 Farming and agriculture

These are just a few general problems; however, I will go into further detail within the assignment
relating these problems to 2 specific countries. Australia and China, two contrasting countries that
appeal to two contrasting markets.



P6: Explain how business support systems enable a selected business to trade internationally.

Business support systems can help ease communications and help businesses to trade
internationally. Over the internet, using technology and international payment method are ways in
which businesses can be supported with trade all around the globe. The use of the internet and
innovative products has enabled businesses to successfully trade all over the world by speeding up
processes and communication being much easier.

There are many different aspects a business may do such as prepayment of the importer, letters of
credit, export credits, bitcoin, Apple pay, international credit card and the internet in general.

Prepayment of the importer

Prepayment of the importer is when a company or business owner is being paid in advance for their
goods and services. It’s when an importer is paying for goods in advance. This requires a lot of trust
especially if this is happening over the globe within countries that are hundreds and thousands of
miles apart. This is also where the use of technology has been helpful as it allows for updates and
better communication. This could be a good way at gaining a business’s trust especially when carried
out overseas so that the receiver of the products will have faith in the company that they are
importing and exporting with. This may also help resolve cash flow problems within a business
however if the products do not arrive there will be major production problems.

The benefits of buying summaries with Stuvia:

Guaranteed quality through customer reviews

Guaranteed quality through customer reviews

Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.

Quick and easy check-out

Quick and easy check-out

You can quickly pay through credit card for the summaries. There is no membership needed.

Focus on what matters

Focus on what matters

Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!

Frequently asked questions

What do I get when I buy this document?

You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.

Satisfaction guarantee: how does it work?

Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.

Who am I buying these notes from?

Stuvia is a marketplace, so you are not buying this document from us, but from seller ellafairchild16. Stuvia facilitates payment to the seller.

Will I be stuck with a subscription?

No, you only buy these notes for £8.19. You're not tied to anything after your purchase.

Can Stuvia be trusted?

4.6 stars on Google & Trustpilot (+1000 reviews)

64257 documents were sold in the last 30 days

Founded in 2010, the go-to place to buy revision notes and other study material for 15 years now

Start selling

Recently viewed by you

Exam (elaborations) ·

(0)

OpenStax Microbiology testbank Chapter 18 : Adaptive specific host defenses

Exam (elaborations) ·

(0)

(Solved) POST First Responder First Aid CPR AED Module 1(Questions and answers)

Exam (elaborations) ·

(0)

Pearson Edexcel GCE A Level in Business (9BS0) Paper 01 Marketing and People and Global Business Marking scheme June 2023

Package deal ·

(0)

Shadow Health Focused Exams Bundled exams for different patients(Full solution pack)Danny Rivera,Nicole Diaz,Brian Foster,Tina Jones & Esther Park exams with complete solution

Summary ·

(0)

Apparatuur en materiaal ( postgraduaat IZ), NIervervangende therapiëen op IZ

Package deal ·

(0)

Comprehensive Exam & Lab Practicum: BIOS255 / BIOS 255 Anatomy & Physiology III with Lab (Latest 2024 / 2025 Updates STUDY BUNDLE WITH COMPLETE SOLUTIONS) | 100% Correct | Grade A - Chamberlain

Exam (elaborations) ·

(0)

PMI CAPM Free Dumps V9.02 Project Management Exam 2022

Exam (elaborations) ·

(0)

TESTBANK FOR UNDERSTANDING PATHOPHYSIOLOGY 8TH EDITION (HUETHER, 2025)

Summary ·

(0)

samenvatting verklaringsmodellen 2 | 17/20
£8.19  1x  sold
  • (0)
Add to cart
Added