Pearson BTEC Level 3 National Extended Diploma in Business (601/7160/1) Unit Number 5 Unit Title International Business Unit Level 3 Unit Type Internal Guided learning hours 90 Unit In Brief Learners study how UK businesses develop

Pearson BTEC Level 3 National Extended Diploma in Business (601/7160/1) Unit Number 5 Unit Title International Business Unit Level 3 Unit Type Internal Guided learning hours 90 Unit In Brief Learners study how UK businesses develop strategies to trade globally. Learners will also consider the factors that influence the implementation of these strategies.

Unit Introduction International business has a significant influence on the national economy. It takes place in a globally competitive environment and involves both small and large businesses. A number of factors need to be taken into account by businesses that are engaged in international business activities. Governments can influence international business to maximise the benefits to the national economy. Countries join international trading blocs to promote and protect international business.

In this unit, you will explore the benefits and issues associated with international business activities. You will investigate the economic environment and cultural factors in international markets and the influence they have on how business is conducted. You will also examine the strategic and operational approaches to developing business in an international context. To complete the assessment task within this unit, you will need to draw on your learning from across your programme.

This unit will give you a greater understanding of the global business environment, which will help your career choices. The unit also gives you the skills and a firm basis to undertake advanced or specialist studies in international business at higher education level.

Learning Aims In this unit you will:

A Explore the international context for business operations B Investigate the international economic environment in which business operates C Investigate the external factors that influence international businesses D Investigate the cultural factors that influence international businesses E Examine the strategic and operational approaches to developing international trade. Summary Of Unit Learning aim Key content areas Recommended assessment approach A Explore the international context for business operations A1 International business A2 Financing of international business A3 Support for international business A report on the factors that influence the decision making of businesses when operating internationally; it will look at how international business is financed and the support given to it. B Investigate the international economic environment in which business operates B1 Globalisation B2 International trading blocs B3 Barriers to international business C Investigate the external factors that influence international businesses C1 External influences C2 International business support systems A journal article/case study giving a situational analysis of contrasting markets supported with a report on the results of the analysis. D Investigate the cultural factors that influence international businesses D1 Cultural factors D2 Impact of cultural factors E Examine the strategic and operational approaches to developing international trade E1 Strategies for operating internationally E2 Resource considerations A presentation examining the strategies and resources used by a business operating internationally. Content Learning Aim A: Explore The International Context For Business Operations A1 International business

Types of business activity: exporting businesses importing businesses multinational enterprises associated businesses, e.g. logistics and marketing. The reasons for conducting business internationally: growth, additional revenue streams, brand exploitation, access to new markets, diversification, increasing market share, market leadership, technological dominance, comparative advantage, economies of scale, fiscal benefits, preferential tax rates. Choice of markets in which to operate, e.g. developed economies, emerging markets, less developed economies. Factors influencing the choice of market, e.g. type of product, costs, size of market. A2 Financing of international business

Methods used to finance international trade, e.g. prepayment by the importer, letters of credit, export credits, bank loans. A3 Support for international business

Agencies that support international business, e.g. UK Export Finance, UK Trade and Investment, Chambers of Commerce, regional advisory organisations. Types of support provided, e.g. UK Export Finance Advisors, trade fairs, identifying international partners, grants for international promotions. Learning Aim B: Investigate The International Economic Environment In Which Business Operates B1 Globalisation

The main features of globalisation, e.g. trading blocs, international mobility of labour and capital, international currencies, multinational corporations, international business communications, international payment systems. B2 International trading blocks

World Trade Organization (WTO). Customs unions and common markets, e.g. European Union (EU), Mercosur (South American nations). Free-trade areas such as North American Free Trade Area (NAFTA), Asia-Pacific Economic Cooperation (APEC). B3 Barriers to international business

The reasons for protectionism in international markets, e.g. to protect infant industries, to protect employment/local business. Methods for protecting markets, e.g. tariffs, customs duties, currency restrictions, quotas, subsidies, legal restrictions. Barriers to trade, e.g. trade restrictions, exchange rate volatility, legal and regulatory systems, financial requirements, operating risks, economic sanctions. Learning Aim C: Investigate The External Factors That Influence International Businesses C1 External influences

Factors that influence international business: political, economic, social, technological, legal and regulatory, environmental and ethical factors. Impact of factors using situational analysis. C2 International business support systems

The influence of the internet, e.g. speed and ease of communication, changes to business processes. International payment methods, e.g. cash in advance, letters of credit, open account, consignment, international credit cards, international bank transfers, commercial payment systems. Learning Aim D: Investigate The Cultural Factors That Influence International Businesses D1 Cultural factors

Cultural factors, e.g. language, ethnic make-up of populations, social structures, religion, values, attitudes to business, attitudes to work, openness to change. D2 Impact of cultural factors

The impact of cultural factors on international business, e.g. contract negotiations, composition of the workforce, management style and its impact on the workforce and organisational culture, marketing strategies/brand names and advertising. Learning Aim E: Examine The Strategic And Operational Approaches To Developing International Trade E1 Strategies for operating internationally

Strategies for operating internationally, e.g. subsidiary businesses, joint ventures, partnerships, agencies, licensing, franchising, sub-contracting and outsourcing. Reasons for using selected strategy, e.g. the speed of establishing operations, access to local business knowledge and expertise, cost control, risk control. Re-engineering products and services to meet the demands and preferences of international markets, e.g. manufacturing vehicles for export with left-hand drives. E2 Resource considerations

Capital costs. Revenue costs. Expertise and intellectual capital, which can be local and/or provided by the incoming business. Training costs for local labour. Organisational structure of international business. Assessment Criteria Pass Merit Distinction Learning aim A: Explore the international context for business operations AB.D1 Evaluate the impact  of globalisation on a business. A.P1 Explain why two businesses operate in contrasting international markets. A.P2 Explain the types of finance available for international business.

A.M1  Analyse the support that is available to contrasting businesses that operate internationally. Learning aim B: Investigate the international economic environment in which business operates B.P3 Explain the main features of globalisation that affect two contrasting businesses.

B.P4 Explore the role of trading blocs on international trade.

B.M2 Analyse the barriers of operating internationally for two contrasting businesses. Learning aim C: Investigate the external factors that influence international businesses C.D2 Recommend one country that a selected business could target for international trade, justifying your decision. D.D3 Evaluate the impact of cultural differences on international business.

C.P5 Explain the external factors that influence a selected business considering trading internationally. C.P6 Explain how business support systems enable a selected business to trade internationally.

C.M3 Carry out a situational analysis on two countries a selected business may consider trading in. Learning aim D: Investigate the cultural factors that influence international businesses D.P7 Explore the cultural differences affecting international businesses. D.M4 Analyse how cultural differences affect international businesses. Learning aim E: Examine the strategic and operational approaches to developing international trade E.D4 Evaluate the success of the strategies and resources used by a selected international business in one of its markets.

E.P8 Explain how products and processes have to be adapted for international markets by a selected business. E.M5 Analyse the effectiveness of the strategies and resources used by a selected international business. Essential Information For Assignments The recommended structure of assessment is shown in the unit summary along with suitable forms of evidence. Section 6 gives information on setting assignments and there is further information on our website.

There is a maximum number of three summative assignments for this unit. The relationship of the learning aims and criteria is:

Learning aims: A and B (A.P1, A.P2, B.P3, B.P4, A.M1, B.M2, AB.D1)

Learning aims: C and D (C.P5, C.P6, D.P7, C.M3, D.M4, C.D2, D.D3)

Learning aim: E (E.P8, E.M5, E.D4)

Further Information For Teachers And Assessors Resource Requirements For this unit, learners will need access to current business information, for example from websites and printed resources.

Essential Information For Assessment Decisions Learning aims A and B

To complete this assignment, learners must ensure they select businesses that give them the depth of information they will need.

For distinction standard, learners will prepare individual reports that incorporate a wide range of research evidence that is drawn from relevant sources evaluating the impact of globalisation on a particular business, over a period of five to ten years. Learners will ensure that careful consideration is given to all relevant factors.

For merit standard, learners will show that they have selected relevant research sources, and applied their knowledge and understanding of international business. They will identify the similarities and differences in approach to engaging in international business that have been taken by their two selected businesses. Learners will consider how the respective strategies adopted by the two businesses for engaging in international business impact on their structure. For example, a business operating in a number of different countries may have a different structure to that of a business that operates in one country but sells its goods internationally.

For pass standard, learners will identify the similarities and differences in their international business operations between the two businesses. You will expect the characteristics of target markets to be identified and for learners to show the impact of these characteristics on business operations and management practices. For example, the relative importance of the size of the market, the cost of labour and capital, and access to raw materials could be considered in relation to the different types of businesses, depending on their business objectives, products and structure.

Learning aims C and D

For distinction standard, learners will present a case study as a journal article that incorporates a wide range of research evidence drawn from relevant sources which have been analysed and assessed. Learners will ensure that careful consideration is given to all relevant factors that may impact on international business strategies. On the basis of their situational analysis learners will recommend, with justification, one suitable country for a business to trade with internationally. The case study will also evaluate the impact of cultural differences on the chosen business.

For merit standard, learners will carry out a situational analysis on two different countries in which the selected business could consider trading in. The analysis must consider the impact of external influences and international business support systems. The analysis will also consider ways in which the cultural differences of each country might affect the international trading of businesses.

For pass standard, learners will explain the external factors that influence the business and the support systems available to manage them. Consideration will also be given to the cultural factors affecting the businesses in both countries.

Learning aim E

It is important that the correct business is individually selected to enable the learner to be able to research the right depth of information.

For distinction standard, learners will present a research study that incorporates evidence drawn from relevant sources. Careful consideration will be given to all relevant and influencing factors that may impact on business decisions taken in respect of changes to the product portfolio, including the development of new products. An analysis of how effectively the business resources are being used and an evaluation of the success of the strategic decisions will be included.

For merit standard, learners will analyse the business strategy for product development aimed at an international market. For example, the learner will identify different strategies that could be adopted in different market conditions with regard to the resource implications of developing new products in an international context.

For pass standard, learners will study an international business involved in either the manufacturing or service sector of the economy. They must review the product portfolio and how different elements of the product need to be adapted when trading in different markets.

Links To Other Units The assessment for this unit should draw on knowledge, understanding and skills developed from:

Unit 1 Exploring Business Unit 2 Developing a Marketing Campaign Unit 3 Personal and Business Finance Unit 4 Managing an event  Unit 6: Principles of Management. Employer Involvement Centres may involve employers in the delivery of this unit if there are local opportunities to do