Effects of Globalization on Business Essay Example-paperperhour.com

By Evans Jan 22 2021

Globalization is the key to every new venture either in a home or a host country. International markets for business in the perspective of sales and purchase are highly affected in a positive and a negative way by globalization. For example, the new entrants for new competitors or change of customers are mostly influenced by the internationalization of businesses because the most domestics companies are protected by their government in both home and host governments (Aharoni, 2014). The business environment in which internalization is taking place is very dynamic in the way that it is changing day by day.

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 In recent times, it can be aid that political and economic integration and more so the technological advancement has had a greater influence on the globalization. The outcome of this is that the cost of distance that is travelling to get some products or services has been reduced drastically (Kose et al., 2012). This has made the dissemination and transmission of information to low prices and almost free. 

Small business has been able to become an agent of parent a company in host countries, and they have been able to advance in terms of technology. Therefore, leading to the small business advancing in their competitive position and to mark their competitive advantage that make the business to be vigour sly competitive.

On the other hand, a business that is not domestically protected or managed or are facing financial distress will be impacted in a negative way by globalization. This distress is because; they will face stiff competition since they are not in a position to compete in term of prices with the foreign subsidiaries in the host country. This means that there is a greater chance of them to collapse.

References

Aharoni, Y. (Ed.). (2014). Coalitions and competition: the globalization of professional business services. Routledge.

Kose, M. A., Otrok, C., & Prasad, E. (2012). GLOBAL BUSINESS CYCLES: CONVERGENCE OR DECOUPLING?*. International Economic Review, 53(2), 511-538.