Globalization and How It Affects Small Businesses

Globalization and How It Affects Small Businesses

Any business out there is it small or big, local or international firm would at one time think of going global. It is the role of the owner and the small business stakeholders to rethink their business strategies focus on the inclusion of new market strategies like the integration of internet and sustainable business concepts, as this will make the business more competitive and more productive in the society. The society is mainly focusing on buying the products that they know will be sustainable and with less harm to the environment. Even in the modern era, small business owners have learned the aspect of making use of the concept of sustainability in their day to day operations in Canada. This has been influenced by the issue of globalization, preparing the business in a manner that it can be capable of performing and serving the interest of the local people and also the international personals. It is important when the society and the government pay attention to supporting the small business operators; this will encourage the issue of growth, expansion, and diversification of quality and services offered by the small business owner. This essay will mainly focus on the role that globalization has played a role in the global business. The essay will major in investigating the most recent reports and surveys from all over the relevant areas.

Impacts of Globalization on Small Businesses

Globalization has been hitting the rise in our lives in recent years at a great speed. In recent years, it has been hard to think about small businesses as just local entities, putting into consideration how international competition, political effects, and tariffs can affect a business. Globalization has been affecting the local businesses in different ways

Market Floods

The biggest fear that comes with the globalization of the big cooperation is the challenges that the small entrepreneurs opening small businesses face when trying to compete with the large companies on the small group of clients with the same products. Countries like China have been exporting goods massively with prices that are hard to keep up with for the small scale producers (Laužikas & Dailydaitė, 2019). The Chinese have been exceptionally flooding the market worldwide in cooperating even with the shipping and repackaging cost making it hard for the local businesses to cope up irrespective of the effort they offer to stay in the market. Globalization also affects other aspects of the business community, as well. Some businesses which are based on phone consumer interaction are also affected by the foreign market, but sometimes the better services offered by the local businesses keep them alive (Laužikas & Dailydaitė, 2019). People are likely to hire some specialized personnel, for example, in the field plumbing from the same country despite some cheap labor from the foreigners.

Global Market Chain Reaction

One of the main business goals is to one day change from a small business to large scale cooperation by shifting in local client mawkishness, experiencing a change in the cost of raw material, or even venturing in new markets and experiencing a new challenge and meeting new clients (Coulibaly & Mekongcho, 2018). Small businesses are also affected by national statements that may not even have an economic effect on the country. For example, when the EU was focusing recently on Brexit affected the stability of the small businesses in the United Kingdom.

A move that was supposed only to affected the international, and overseas businesses hitting the large scale companies, the Brexit concern has instilled fear among the small scale producers and companies by hindering free movement of goods and services within the small scale companies who have small number of employees or hardly have any employer where the business owner does all the tasks (Payonk, et al, 2017). The United Kingdom has been having different reactions. The Irish and the Scottish businesses have been showing a bigger sign of indecision.

The war between the United States and other leading business countries also affects the operation of businesses from the small scale companies to the large scale cooperation to the supply chain. Tariffs are the main cause of price fluctuations like what was recently experienced when the United States introduced tariffs on Chinese goods (Laužikas & Dailydaitė, 2019). But it has also been hard to close the local borders for the global market and entrepreneurs since the world, in general, continues to trend towards globalizing.

Local Competition Turning To In International

It has been easy for the local businesses to thrive in the local market due to the full understanding of how to spread information and the lack of propagation of business across the border. After coming of the internet, people now can shop online from their comfort zones, with also goods being delivered to your doorstep (Crane, et al, 2019). The internet has taken a large part in connecting to the consumer directly and taking a large part of trading the tangible goods. It is now not a guarantee for a local business to thrive in the local market currently and in the future.

The global companies have been injecting products and services to the accounts of specific local markets in a manner that makes it difficult for the small scale business operators to counter the global companies (Payonk, et al, 2017). Long ago it used to be the issue of cost regulations by the big companies but it has currently changed due to the ability of the large cooperation’s ability to perform proper research about certain product and services before venturing the market, the companies also have data manufacturing instruments hence have the ability to control both the global and the local markets.

Local Turmoil

Most of the local businesses cannot export their products overseas or across different borders, but capitalizing and working in markets where the downfall of the small scale firms do not certainly lead to the death of the entrepreneur is important (Coulibaly & Mekongcho, 2018). When the local markets are experiencing some challenges, then the global market is always operating with ease without being affected by the local markets, which in turn can help the local market to overcome the challenges.

Local businesses are always not expected to perform globally irrespective of the massive contribution to the exports that the country transacts overseas. For example, 95 percent of the exports performed by the United States come from small business entrepreneurs.

Market Expansion

Small businesses also need to expand their market reach and expand their boundaries. Globalization has helped to open up the global markets and the trade lines linking business networks to the local businesses, which can operate through large corporations and reach the outside market.

For example, the global drop shipping of products is a business venture that was recently invented to open the world to a free-trade world (Laužikas & Dailydaitė, 2019). The type of businesses that do not physically possess the type of goods that they trade do not really require the local deals since they also have the ability to reach the outside market, the shipping cost of the commodity is always set aside, as the beneficial part of having the goods present during handing over at the location of sale is always negated.

Also, businesses irrespective of their sizes can target oversea markets serving people with similar taste to the local people, which lead to opening up of new income opportunities without the need of opening a new branch in a foreign country.

Market Equalization

During the past years, accessing the global market was next to impossible, and a limiting factor to the lives we lived during that period. After coming of the internet, it has been an easy task to spread the name of your business to the global market especially with the availability of the social media, which has been the face of the global market recently where the targeted client can access your products from all corners of the world (Crane, et al, 2019). The small businesses are now able to operate like the global business entities serving clients from different parts of the world.

If a young entrepreneur can come up with great ideas and can market the idea effectively, then no difficulties are experienced in exposing the business to the outside world (Payonk, et al, 2017). We can market and perform to the level of significant business companies. Regardless of the impact of globalization on the local market, it is of great importance to keep in remembrance that cloistering off from the world is not an option like it used to be.

Most, unfortunately, the small entrepreneur could only contend on a similar scale as bigger companies with globalization through embrace techniques for computerization and network (Laužikas & Dailydaitė, 2019). It may not be powerful any longer for the nearby vineyard to provide services to similar customers they generally have, working out receipts and guiding endlessly from anything remotely mechanized. Small companies need to advance to remain applicable, and this incorporates making an online nearness with the appeal of being available and being available to robotized arrangements that will help fabricate over the long haul. The expectation to absorb information can appear to be overwhelming and costly; anyway, there is a heap of advantages to receiving this better approach for getting things done.

In the past, for a small business to venture into the global market was like a dream. There was no internet, which has been a bridging gap in recent years (Crane, et al, 2019). Taking our business to the global market in the last century required one to travel physically so they could survey and study the ready market and what the clients are requesting. This method was costly, with inclusion with the travel tickets. It was more expensive for small businesses to venture into the global market. Also, marketing strategy during those periods was trickier because you were required to advertise in magazines or televisions, unlike in the present world where you can advertise from your comfort zone on social media (Crane, et al, 2019). During those periods, the expenses of advertising were very high since the advertising platforms were very few and hard to find.

Managing and planning a business needs a lot of strategies to break in the global market. Planning strategically and planning a business allows the entrepreneur to achieve its goals by setting priorities, effectively using the available resources, and adjusting the direction of the business with respect to the available business environment (Coulibaly & Mekongcho, 2018). For your business to succeed today in the competitive global market, you should be prepared with the following strategies:

Finding the Right Market for Your Products

Discover and pick the correct international market that is appropriate for your kind of business. You should investigate and assess your item or administration request in various universal markets. Picking the correct goal, as indicated by your business type, is the initial step of vital global business arranging.

Understand Your Competitor

Know your rivals in your picked worldwide market. If the challenge is extremely intense, it is smarter to pick an area with a few numbers of competitors close to you, regardless of whether the interest for your item is lower in this area (Coulibaly & Mekongcho, 2018). You can all the more effectively increase a higher piece of the overall industry with less challenge.

Discover Growth Opportunities

Recognizing development opportunities is a significant part of vital planning in worldwide business. Development systems are intended to develop organizations by either finding new markets in beforehand unexplored pieces of the world or assessing new techniques to build a piece of the overall industry and benefits in existing universal markets (Laužikas & Dailydaitė, 2019). I hope to characterize your development methodology or methodologies during key arranging.

Developing a Plan for the New Market

Universal business varies from a local business in many different ways that you may need to manage in different nations in various pieces of the world. Various techniques might be required for every area because of the variety in political, lawful, or monetary atmospheres of the various zones. Beset up to embrace various designs for various markets relying upon explicit market prerequisites.

Finding Strategic Partners

On the off chance that you are thinking about universal business development, you will require various systems for various markets (Payonk, et al, 2017). For this situation, it is hard for a solitary substance to execute the development easily. Think about finding a key accomplice, one mindful of market inclines in the areas where you are extending, helping you with your development.

Be Flexible To Any Required Changes

Monetary or political conditions in any market may not stay unaltered for long (Nikolova,, 2017). You should continually break down your market’s circumstance with the goal that procedure and arranging react to changes in advertising conditions to keep up the persistent development of your global business.

In the future in your planning and management strategy to venture in the global market industry, the following steps should be taken into consideration;

Have a Better Strategy

Start with an unmistakable arrangement to feature present moment and long haul development objectives. Organizations can take advantage of the best lucky breaks when their pioneers completely comprehend the potential areas for an extension (Laužikas & Dailydaitė, 2019). In another region, another plan of action may likewise be vital. This will assist your group with staying centered and gives a lot of space for examination between existing endeavors in a similar circle. An inner procedure and natural information on your business’ qualities and shortcomings will be likewise vital for a viable aggressive examination. Similarly, as qualities and shortcomings may vary after some time, open doors may likewise change at specific focuses.

Risk Management

Globalization is a risky venture, irrespective of the advantages that come with it. The inability to make the correct strides at an early stage will cause a quicker breakdown in global markets than what we would see locally (Dancygier & Walter, 2017). The requests that worldwide markets place on groups will change, so your gathering should be well-prepared for what’s around the bend. Being ready for each situation will help your organization certainly handle these difficulties, so it’s imperative to teach the team that you will be working with. Straightforwardness is basic. Another vital aspect for beating opposition is continually being straightforward and sensible about results and circumstances. By the day’s end, it is your validity that individuals trust and now and then assists with the obscure.

Consistency

The effect your organization in another environment will rely upon your execution and consistency. Physical updates or adjusted language ought not to change your organization’s fundamental beliefs (Coulibaly & Mekongcho, 2018). You’ll have to keep those qualities predictable over all domains, since it is what shoppers associate your image with, consequently why you need consistency and the protection for your brand. This comes with challenges; however, it is essential to recollect that on a worldwide scale, we are required to identify with each other with thoughts and sentiments that rise above traditions and language. Regardless of what nation, you will need your clients to feel invited, great, and unmistakably comprehend your brand.

Powerful Team

You will be required to build a powerful team, whereby each member will be required to offer something different to the other to gear up the expansion of the business. Everybody will be required onboard with the coordination and working together to grow the company. Failure to dialogue may be a challenge to your business (Crane, et al, 2019). Having difficulty in a conversation between the workmate may cause struggles that may cause your company to go down. Overcoming such challenges will be important and necessary for the growth of your business.

Conclusion

In conclusion, globalization has been happening worldwide, opening doors for small businesses and making it easy for them to thrive in the evolving world. Globalization has been affecting the small businesses both directly and indirectly. Globalization has come with both negative and positive impacts. The small companies have been facing competition from large companies due to the introduction of globalization.  Small businesses are now getting affected by factors that were meant only to affect large and international cooperation. After coming of the internet, people now can shop online from their comfort zones, with also goods being delivered to your doorstep. Small businesses have also gotten the chance to expand and reach the international market. Managing and planning of your business is an important aspect if you want your company or your firm to reach a competitive international market.

References

Coulibaly, S. K., Erbao, C., & Mekongcho, T. M. (2018). Economic globalization,             entrepreneurship, and development. Technological Forecasting and Social Change, 127,   271-280.

Crane, A., Matten, D., Glozer, S., & Spence, L. (2019). Business ethics: Managing corporate        citizenship and sustainability in the age of globalization. Oxford University Press.

Dancygier, R. M., & Walter, S. (2017). Globalization, labor market risks, and class cleavages.

Laužikas, M., & Dailydaitė, S. (2019). Impacts of social capital on transformation from     efficiency to innovation-driven business. Journal of Business Economics and             Management, 16(1), 37-51.

Nikolova, L. V., Rodionov, D. G., & Afanasyeva, N. V. (2017). Impact of globalization on          innovation project risks estimation. European Research Studies, 20(2), 396.

Payonk, K., Lyashenko, V., & Kvilinskyi, O. (2017). Operation of a business entity in the             context of globalization. Экономический вестник Донбасса, (4 (42)).