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Leeds Metropolitan University Module: Global Business Context

Doing Business In...

Index
1. Introduction .................................................................................................................. 3 2. Justified country choice ................................................................................................ 3 3. Most important Characteristics seek by the company. ................................................. 4 4. How Australia fulfils the requirements. ....................................................................... 5 5. Relevant Aspects of the Australian Macro and Micro Environment............................ 6 5.1 Macro Environment. ............................................................................................... 6 5.2 Micro Environment................................................................................................. 6 6. Conclusion .................................................................................................................... 7 7. Bibliography ................................................................................................................. 8

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Doing Business In...

1. Introduction
Firstly, the focus of this report will be to analyse conclusions from Global Business Context task 2 and with suitable references indicate the most appropriate country to export my student support agency service. Likewise the previous assessment, it will represent several features, such as, country stability, population density, ageing and economy strength. However, at this stage, a deep examination will take place and conclusive justifications will be supplied. Apart from all the possible descriptions required to consider, only the features that have greater impact on the student support service will be investigated in order to assemble in one simple report all the necessary information to productively export the service. Finally, macro and micro environment characteristics related to my country selection will be identified, as well as, its impact within different business departments. According to Space Daily (2011), a good perception of the macro and micro features while reflecting on the most appropriate country to invest is essential for success. It will provide one advantage over relevant incidents that might occur, in particular, political alterations, economical deviations, legal procedures and social variations (Rushton, 2011).

2. Justified country choice
Evaluating a potential market to export a service requires one deep research over several aspects. Accordingly, it is suitable to allocate important characteristics into different departments such as, socio economic, demand, barriers to entry, supply issues, technology and competitors. Among several overseas countries with potential to supply sustainability for a student support service, Australia is the one that reunite nearly the full extent of the required conditions. Firstly, reflecting on the socio economic theme, according to OECD (2011), the Australian government spends on education almost 6% of all gross domestic product (GDP) which is above the Organisation for Economic Co-operation and Development (OECD) countries. Other socio economic factor also relevant is the number of undergraduates enrolled on Australian Universities which suffered one increase of 5.9% from 2009 to 1 192 657 domestic and international students (Australian Government, 2011). As States News Service (2011) mention, government is investing on higher education due to its importance for Australia´s economic future. Once the public sector is investing on education, it may be easier to develop contracts and obtain financial support. Page 3

Doing Business In...
Secondly, there are some barriers and supply issues appropriate to be aware while the exportation strategy is being determined. There are a wide range of organisations focused on the student support service in Australia particularly the National Business Institute (Targeted News Service, 2011). Eventually, these type of organisations might seek to provide the same sort of service in order to eradicate competition. As a service that is required to be supplied in a short time basis, there is always a margin of error that might occur (Wetherly & Otter, 2011). As a consequence, one mistake in such a competitive environment might result in one massive lose of the market share. However, this atmosphere will force my service to be highly aggressive and very effective. Finally, technology is also a very important factor in order to decide where to allocate my service. Once the business will be based on a just in time method, technology requires almost a daily support and cannot fail. According to ASAgroup (2011), Australia have the capability to provide high quality IT support and resources to every company, as well as, a notably developed internet connection chain.

3. Most important Characteristics seek by the company.
In order to achieve sustainability on overseas markets, for a student support service, there are important characteristics that necessitate to be fulfilled. Due to its main public target (students), the company is seeking for a country with educational history, as well as, high financial support from government. According to The National Center for Public Policy and Higher Education (2011), government investment on higher education is of main importance, in order to, expand University admissions. As a consequence, the increase on the number of undergraduates will possibly boost demand for the student support services. Likewise government expenditure on higher education, the country's history is also a key factor for the student market share. Once a nation is well known among the world on educational purposes, demand is more stable facilitating this way forecasts for future years (Harvard University, 2010). As Wardell (2011) mentions, student support service operations do not require high levels of technology, however, it is essential to develop a vast database. Therefore, to work effectively on a wide database it is necessary to, above all, hire skilled labour (Reference for Business, 2011). Admittedly, my company requires a country capable of supplying skilled labour and at the same time resources to develop a large database. Besides all the background work controlled by the company employees, to utilize this service appropriately some knowledge is required by customers. As Pr Newswire (2011) states, about 30.2% of the world's population has the ability to work with the Page 4

Doing Business In... internet, however, this feature is more accentuated on developed countries. As a consequence, my product will be more productive within countries that face higher internet familiarity figures. Finally, due to the extreme entrance difficulty created by organisations on monopoly or oligopoly markets, my service is seeking to escape from such distortions. A healthy competitive market will in part increase the service establishment and at the same time force to improve effectiveness (Mankiw & Taylor, 2010).

4. How Australia fulfils the requirements.
Fist of all, it is suitable to make reference to the country´s educational history because of its impact on demand stabilisation and prediction. According to Mines Paris Tech (2011), Australia is one of the best nations to enrol in one degree among the world's leading countries. This figure indicates the extreme importance given to the Australian educational sector, providing this way a quick and stable possibility to entre on the market with a student support service. As it is mentioned by Invest in Australia (2011), the Australian government is investing $268million on higher education due to its importance to the national economy. As a consequence, it will create one very healthy environment for this so important sector. Moreover, the government injection will boost the opportunities for Australians to enrol in one university degree, increasing this way the demand for my service (Invest in Australia, 2011). Secondly, there is the importance of a background know-how by the customer to use internet connections in order to obtain the most of the service. As it is mentioned by Infoplease (2011), about 60% of the Australian citizens acquired knowledge about this so important connection chain. It is seemed that from 2000 to 2011 there was one increase of about 179.40% on internet users. This massive boost indicates that about 60% of the Australian population is prepared to effectively get benefit from my service. Likewise internet users, Australia is also very developed on high tech technologies. Due to my database requirements and the just in time system, the service will necessitate one full time technological support. Finally, the market structure require to be highly competitive and well financed. According to Nielson (2011), there are a wide range of agencies available on the Australian economy and mostly competing for a small percentage of the market share. Therefore, it is possible to acquire a piece of the market share with high standards of efficiency and quality without the risk of being contracted by giant organisations barriers. Page 5

Doing Business In...

5. Relevant Aspects of the Australian Macro and Micro Environment.
5.1 Macro Environment.
In order to evaluate the Australian macro environmental aspects relevant for my product it is suitable to make reference to a PESTEL analysis where the political, economical, social, technological, environmental and legal factors are referenced (Oxford University Press, 2007). Like it was mentioned on the points above, the Australian government is dedicated to maintain the student support services, capitalising the sector and sustaining business services. Moving for the main economic factor, Australia registered one increase of 4.2% of its gross domestic product from 2009 to 2010 (The World Bank, 2011). This figure indicates that even passing through one of the worse global crisis, Australia maintained its GDP rising constant, demonstrating this way economic strength and stability. Other important sector from the PESTEL analysis is the social factors and Australia in relation to my service is supplying all the characteristics required. Due to its educational history, demand stability is possible to achieve, as well as, forecast. Turning to the technological sector, as it was mentioned previously, Australia is highly developed on technological matters. Additionally, Australian citizens seem to follow this technology improvements. According to EPA South Australia (2011), the Australian authorities are very strict on environmental effluence issues. However, because it is a clean service, it will not have any impact on the environment around. Finally, the legal sector is also of main importance to be aware. According to the Australian Government (2011), the migration regulations have been changed and to arrange a visa, nowadays, it is necessary to present one extended list of occupations which might difficult the possibility to enter on the country.

5.2 Micro Environment.
To effectively evaluate the micro environment it is particularly important to make reference to the suppliers, distributors, customers and competition. Firstly, as a student support service, there are many suppliers that are needed to be conscious of. Once the service will mainly operate as a intermediary in every operation, the product supplied will be directly delivered to my business customers. Consequently, is of main relevance to be sensitive to the products quality and effectiveness. According to The World Bank (2011), 68% of the Australian GDP is provided by the service sector. This figure indicates that Australia is highly developed on the service provision area which in certain way, offer some confidence for a business that mainly supplies other services from different companies to customers. Focusing on the distribution channel, it is in this sector that my service can successfully attain a competitive advantage over other similar services on the market. Page 6

Doing Business In...
As Oxford University Press (2011) states, it is on the distribution channels that several organisations, such as, Banks, insurance companies and holiday firms throughout internet earned a portion on the market share. Accordingly, for a student support service where mainly services need to be supplied as soon as possible, it is necessary to successfully manage the different distribution channels. In order to improve the delivery canals, it is essential to have the business main centre of operations on a country that deliver a fast response to alterations. As it was mentioned above, the majority of Australian GDP is generated by the service sector which is a significant sign while seeking for fast response and effectiveness. Finally, in the micro environmental analysis it is also important to include customers and competitors. It is on these areas that my service necessitate to demonstrate the ability to quickly perform without compromise the products quality. On the one hand, there is the obligation to reduce prices due to the extreme competitiveness established on the Australian market. On the other hand, is the demand for quality by customers. As a result, this service need to be well organise and very responsive in order to sustain in such a sensitive market.

6. Conclusion
Overall, after a deep research over the characteristics that my service requires, how the chosen country fulfils them and the Australian micro and macro environmental analysis, it is possible to conclude that Australia reunite almost entirely the essential features necessary to launch this student support service. The task two evaluation had a major influence over my decision to opt for Australia. In a summed way, it mainly filtered the important information to successfully export to a foreign country. In order to supply efficient information related to the macro environment, in my opinion it was suitable to utilize the PESTLE examination system. In general, it provided precise information about strengths and threats that my service will possibly face while operating in this such competitive market. In my opinion, among other important aspects, the one that seem to have the greatest impact on the student support service is the Australian educational history. Moreover, it is followed by one increase on the students enrolment on Universities undergraduate courses.

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Doing Business In...

7. Bibliography
ASAgroup (2011) Australian Computer Society [Internet]. Available from: [Accessed 6th December 2011]. Australian Government (2011) Student 2010 Full Year: Selected Higher Education Statistics [Internet]. Available from: [Accessed 6th December 2011]. EPA South Australia (2011) What you need to know [Internet]. Available from: [Accessed 9th December 2011]. Harvard University (2010) The Role of the University in a Changing World [Internet]. Available from: < http://www.harvard.edu/president/role-university-changing-world> [Accessed 9th December 2011]. Infoplease (2011) World Internet Usage, 2011 [Internet]. Available from: [Accessed 9th December 2011]. International Human Development Indicators (2011) Australia Country Profile: Human Development Indicators [Internet]. Available from: [Accessed 9th December 2011]. Mankiw N. & Taylor M. (2010) Economics. Hampshire, South-Western. Mines Paris Tech (2011) International Professional Ranking of Higher Education Institutions [Internet]. Available from: [Accessed 9th December 2011]. Nielson (2011) Market Structure [Internet]. Available from: [Accessed 9th December 2011]. OCDE (2011) Country statistical profile: Australia [Internet]. Available from: [Accessed 8th December 2011]. Oxford University Press (2011) Analysing the micro-environment [Internet]. Available from: [Accessed 9th December 2011]. Page 8

Doing Business In...
Oxford University Press (2007) PESTEL analysis of the macro-environment [Internet]. Available from: [Accessed 9th December 2011]. PR Newswire (2011) Global E-mail Marketing Industry [Internet] Nexis. Available from: [Accessed 9th December 2011]. Reference for Business (2011) Marketing communication [Internet]. Available from: [Accessed 9th December 2011]. Rushton, K. (2011) WPP cuts forecasts as double-dip fears persist [Internet] Nexis. Available from: [Accessed 6th December 2011]. Space Daily (2011) Manufacturing goes viral [Internet] Nexis. Available from: [Accessed 6th December 2011]. States News Service (2011) Australian College of Educators 2011- Biennial Bassett Oration [Internet] Nexis. Available from: [Accessed 6th December 2011]. Targeted News Service (2011) Speaker Urges Unis to 'Look to the Curriculum to Boost Inclusion' [Internet]. Available from: [Accessed 6th December 2011]. The National Center for Public Policy and Higher Education (2008) Special Report by the National Center for Public Policy and Higher Education [Internet]. Available from: < http://www.highereducation.org/reports/wegner/index.shtml> [Accessed 9th December 2011]. Page 9

Doing Business In...
The World Bank (2011) Economic Policy and External Debt [Internet]. Available from: [Accessed 9th December 2011]. The World Bank (2011) Services, etc., value added (% of GDP) [Internet]. Available from: [Accessed 9th December 2011]. Universities Australia (2011) Student numbers & characteristics [Internet]. Available from: [Accessed 6th December 2011].

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