Royal Dutch Shell and BMW, are international companies. Royal Dutch Shell was founded in the 19th century. At the time the company was just known as Shell, through which Londoner Marcus Samuel imported shells from East. Shell was later passed on to brothers developed an interest in the oil exporting business. In 20 years later the company became really well known and became the leading company in the world. In 2014 the stats of the company were like this. Revenue: $421.1 billion Employees: 94,000. The market is Royal Dutch Shell is in oil market.
Royal Dutch shell as a leader, shell is the world’s biggest distributor. They provide innovative way to bring more efficient energy for their customers. Shell aims to deliver benefits by making energy efficient products by reducing the impact of their operations, to improve the way they design, build and run their operations. This makes a big effect on the company as a whole, because they can run operations quicker and more efficiently.
Shell Company attracts and delivers profitability in an environmentally and socially responsible ways. They work closely with their customers and partners across the world, aiming to better understand what their customers need are. They have people working all around the world with various skills helping them to do so.
The growth of Royal Dutch Shell, in an industry where operations last for decades, Shell has established a reputation for long term planning based upon scenarios
The second international company is BMW. It was built in 1952. BMW cars have been sold in America since 1956 and manufactured in the United States since 1994. The first BMW dealership in the United States opened in 1975. In 2016, BMW was the twelfth highest selling brand in the United States. The slogan ‘The ultimate driving machine’ was first used in North America. In 2010, this long-lived campaign was mostly supplanted by ‘joy’, this was made so it is more approachable and better appealing to women, but it didn’t last very long and two years later they changed it back. The market this company is in, is cars, it is very competitive market and there is a lot of famous companies that are in this market.
Car industries have been manufacturing cars for a very long time, it has been a major employer, also over 100 years it has provided safer and more accessible transport for increasing numbers of people, including in newly industrialized countries. However car- related pollution and congestion have become an issue in many major cities. For BMW selling cars all around the world has been profitable and made a big change in transport. The globalization brings flexibility for BMW as they can produce car parts almost about anywhere in the world and sell almost anywhere in the world.
Royal Dutch shell is an oil company found in Netherlands and incorporated in United Kingdom. Globalization has a big effect on shell. The reason shell is so big right now is mostly because of their international trading. They have gas stations placed all around the world, this gives a lot of flexibility for the company.
Globalization took a big part for both companies. Firstly, BMW has been exploding in sales and this is mostly thanks to globalization. Globalization allowed BMW to manufacture cars and sell cars around the world. Also, in the field of exportation, governments helped corporations that have vested interest in the community and those that help stimulate the economy, whether it is local or national. In 15 or so years that the United States has been manufacturing BMW’s, they have exported more than 1 million units. A record like this could have not been possible for companies like BMW without governments help.
The role of trading blocks. Trading blocs are very important for businesses contributing to the development, industrialization and economic growth of whole region. Trading blocs are a sound and efficient way to create sustainable economic growth. Liberal policies and removal of trade barriers has resulted in the growth of industries in those regions.
Advantages for members of trading blocs is free trading within the block. They have free access to each other’s markets, members are encouraged to specialize. This means that, at the regional level, there is a wider application of the principle of comparative advantage.
BMW, is settled in Germany and in EU trading blocks, in that block they can trade for free and enter different markets, without additional costs. However, when they decided to expand and start selling cars in America and start manufacturing there too, they had to pay additional costs and taxes to do so. This is because America was in different trading bloc. The most recent one that could affect the share and profits for BMW is when Donald Trump decided to add taxes to European cars. This can be a huge impact for companies like BMW, as they would loose on a lot of profits.
Royal Dutch Shell, a very well-known gas and oil company, trading blocs have a big impact for the company. This is because the company itself is settled in Netherlands and they had a lot of operations in EU, Asia, North America and Australia. The company had to go through different trading blocs to be able to trade with different countries to set up their gas stations all around the world. This made the company loose on profits has they had to pay different taxes to be able to settle gas stations in different trading blocs.
Advantages of trading blocs. There are five major advantages of trade bloc agreements foreign direct investment, economic of scale, competition, trade effects, and market efficiency. Foreign direct investment is an increase in foreign direct investment results from trade blocs and benefits the economies of participating nations. Larger markets are created, resulting in lower costs to manufacture products locally.
Furthermore, trade effects this eliminates tariffs, thus driving the cost of imports down. As a result, demand changes and consumers make purchases based on the lowest prices, allowing firms with a competitive advantage in production to thrive. Another good advantage of trading blocs would be market efficiency, the increase consumption experienced with changes in demand combines with a greater amount of products being manufactured to result in an efficient market.
However, the disadvantages are regionalism and multinationalism this includes trading blocs bear inherent bias in favor of their participating countries. For example NAFTA, a free trade agreement between United States, Canada and Mexico. Trade among NAFTA has risen to more than 80 percent of Mexican and Canadian trade. This obviously benefiting these three countries in which they are trading.
European Union is the biggest trading bloc in the world and it is the largest imported of agricultural products from developing countries and it includes of many different countries. Whereas, NAFTA only includes three countries a very big difference between EU.
BMW, in 2017 the first half of the year also turned out to be a record one for the first time in the history of the brand over one million cars were sold. This was a very good year for the company, they sold a lot and made a lot of profit which helped out the business massively. BMW revenue in 2017 increased by a lot and in Germany a record of 83389 motorcycle sales were recorded.
In addition, in 2016 more than two million BMW brand vehicles were sold for the first time within a single year. Deliveries to customers were up by 5.2 percent at 2 million units sold. Harald Kruger also quoted that “2016 was the first step in the next 100 years of the BMW group”. This tells us that the Kruger was very happy for the 12 month period where they managed to improve the way company works and increase profits and shares by a lot, and now you see BMW branded cars in every corner of the street. This shows us how much popularity the company gained over the years.
Royal Dutch Shell, had a big explosion when their company blew up and their sales increased. Also, before they were mainly focused in Dutch and UK to open up gas stations, but now they have gas stations all around the world.
Both companies are very large and for them trading in many different trading blocs at the same time is very beneficial. This is because both companies have very big competitors and this means they need to expand to areas where other companies haven’t and dominate the market. In the 1980s it expanded overseas business through acquisition. The acquisition of 30% shares of Shell Oil in 1985 consolidated Shell’s operations and business in the U.S. market. During this period, offshore exploration technology and projects were developed, such as the Troll in Norway and the Gulf of Mexico.
Royal Dutch Shell Structure
The Shell ownerships is a really important role in the company, decision making has to be by top management. Also, Shell as the technology leader the world’s biggest distributor the company succeeds in providing innovative way to bring more efficient energy for their customers. Shell also generate profitable growth which then the profits are spent in improving the company. Shell aims to deliver benefits by making more energy efficient products by reducing the impact of their operation.
Shell’s organizational structure at the beginning of the twenty-first century has changed by a lot in a modern day. Firstly, Shell has developed as a highly decentralized, highly international group of national operating companies coordinated and controlled from the head offices in London and The Hague. From the mid-1960s it was managed through a three-way matrix structure. The dimensions of this matrix were the regional coordination structure, the business coordination structure, and the functional structure.
Shell has really showed how the centralized ownerships make decisions and it all depends on them. They make sure they hire high qualified people and this allowed company to really explode. Shell has been in this market for a very long time and they know how much it takes to be innovative and come up with new ideas when it comes to gas and oil market. For example, if you compare Shell’s competitors such as ‘Eni’, the company wasn’t able to compete with Shell as they over ran the Italian company. There is more competition to this day, but Royal Dutch Shell doesn’t fear none of them. They are always on top and it will always manage to beat their competitors.
The other company involved in a different market which also competes with many different companies all around the world in many different trading blocs. Span of control is a term used in business management and it refers to the number of subordinates a supervisor has. The span is influenced by many different factors such as nature of work, type of management, types of organization and type of workers. Just like any other organization BMW has its own span of control. At 31 December 2011, the BMW group had workforce of approximately 100,000 employees. It is very likely that BMW group employs many managers as it suggested that a manager should only be supervising from 1-10 subordinates at the same time. This is due to the fact that technology helps managers a lot when trying to present their ideas to the workers.
BMW has been the leader for a very long time, they have been trying their hardest to keep making innovative ideas of new cars and sell them around the world. It takes a lot of work to maintain such a big number of employees working for the company. BMW was initially established to build aero engines during the First World War by 1945, company was still country’s leading aero engine manufacturer. But by 1928, BMW has also started making cars, when it got the license to do so. It was later when BMW became one of the biggest automobiles makers in Germany and this is where the production and exploitation of the company happened and it didn’t last very long, because straight after World War Two, the company was laid into ruins. The demand of aero engines suddenly dropped down. Its factories were controlled by the soviets and this all lead to 1959 when the company faced bankruptcy. Herbert Quandt, then decided to purchase 50% of the shares of the company became a very powerful shareholder, and from there turning point has happened and started production of the cars and releasing them which soon got the BMW brand and the reputation it deserved. Now day BMW has ownerships of three quality brands, BMW, Mini and Rolls-Royce motor cars.
The support available to businesses that operate internationally.
Trader fairs support business that operate internationally. Trade fairs are organized by trade associations and there are many different trade associations that can support the development of international trade. A good example would be associated independent stores. This works to help smaller retailers by putting together expertise, knowledge and purchasing power. These are all the ways that this associated independent stores help out smaller retail shops.