1) Globalization is making the entire world a single market place; it brings the whole world

together. There are two types of Globalization:

 Globalization of Market is producing one product in the home country and then within
time expanding those products in other countries as well. Which, IKEA did they started
the business from their home country Sweden and then later expanded the business in 60
countries with 454 IKEA stores, they are known as a Multinational Company and
recognized as the World’s 58th most valuable home furnishing brands referred by Forbes.
They have more than ten thousand categories and the price they keep is affordable as they
already have few stores in Asia, which shows that they have an idea about the taste of
Asians. Which will bring positive response for them in future while opening store in
Pakistan.
 Globalization of Production is taking advantage from different countries by trading
with their goods and services in cheaper price comparing from their own country. It is not
mandatory that it will work in terms of price only, rather its about better quality and the
factors of production. Ikea did the same thing, as they work with many varieties of
countries, they know which country is more efficient in which stage of production. So,
this increases their quality level and make it more attractive with reasonable pricing, so
that they can treat all their customers equally. As this is a plus point for Ikea, they might
not face issue in terms of starting their business in Pakistan as well.

2) Political Environment is the legal, economical and political system of a country are
interdependent. Pakistan’s economic growth slowed down and face a negative affect
while covid-19, but according IMF the growth increased by 3.9percent in 2021 and they
are stating that in future it might increase. During the election in 2018 Pakistan’s new
Prime Minister promised them to improve the economic growth of their country by
higher the level of foreign investments, which shows that they will welcome Ikea in the
country. But war between Ukraine and Russia might put a negative impact. United States
had a negative point of view regarding Pakistan and terrorism in past. But avoiding that
fact Pakistan has efficient labors, good in industrial sectors, agriculture sectors as well.
As Ikea is a furniture-based company it might be good for them to open stores in
Pakistan, as they already worked with many Asian countries before so they have the
experience of their taste and culture as well. However, in Pakistan strikes takes place day-
to-day for political reasons which it might be a pressure for Ikea as in the delivery might
not be in time of their raw materials. Which might be a reason of bad customer’s service.
Although, it will not be a daily problem as the strikes takes place occasionally. Ikea can
make sufficient profit if they come in Pakistan.