How does globalisation affect businesses across the world

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Evaluate the arguments that globalisation will inevitably lead to unethical behaviour (25 marks) 11th March

The world is shrinking thanks to advancing technology, greater openness has made it easier for firms to buy their supplies from a wider range of businesses and sell their products anywhere in the world. Different governments and businesses have different views; many believe that freer trade between nations will offer prosperity and growth for all countries and businesses.

Globalisation is not only due to political and economic change, it is also due to direct result of better and cheaper communication and technology. This improved technology has made marketing easier through internet or television and a cheaper way to mass produce and sell products at affordable prices allowing businesses to compete anywhere in the world. Globalisation has created new opportunities for businesses as they can enter new markets and attract new customers. This allows businesses to grow in a rapid way as show in Igor Ansoff’s matrix (the risk increases from 1-4) and also benefit from economies of scale. Most global businesses use market development because they same the same product in a new market, global businesses can use diversification but it is more risky. This also allows them to increase sales and profits. They also have a wider range of suppliers which the business can choose from. This gives global businesses more power as it allows them to bargain with suppliers and they maybe able to decrease the cost of raw material. This is one of Porters 5 forces.  

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Business have been able to benefit from economies of scale and this has allowed businesses to build a global brand allowing businesses to increase reputation and brand awareness and allowing them to gain a competitive advantage over competitors.

Markets are moving away from globalisation because consumer demand is changing and customers now want tailor made products which are from their own culture and attitudes. Customers are now seeing global brands as arrogant and insensitive as they are not linked with their needs. Global are also seen to be not providing the customer service that local, smaller businesses can ...

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