ASSIGNMENT

NAME: DIANA I. A. ABUEIDA

STUDENT ID: ABSBBA21080188
SUBJECT: BUSINESS IN WORLD ECONOMY
Answer # 1 - GLOBALIZATION
Globalization refers to the expansion of ideas, knowledge, information, products, and
services around the world. In business, the word is used to define interconnected
economies that are characterized by free trade, open capital movement among
nations, and easy access to foreign resources, especially labor markets, in order to
optimize returns and benefit for the common good.

Countries specialize in the products and services in which they have a competitive
edge in a worldwide economy. This usually refers to what they can create and supply
more effectively, with less resources, and at a cheaper cost than competing
countries. In principle, if all countries specialize in what they do best, global
production will be more efficient, prices will be cheaper, economic development will
be wider, and all countries will gain.

Among the recent technological changes that have played a role in globalization are
the following:

Internet and internet communication. The internet has expanded information and

knowledge sharing, access to ideas, and cultural interchange amongst individuals
from different nations. It has helped to bridge the digital divide between developed
and developing countries.

Communication technology. Mobile and wireless networks have become much

faster and more responsive since the launch of 4G and 5G technology.

IoT and AI. These technologies make cross-border product management more

efficient by allowing assets to be tracked in transit and as they move across borders.

Blockchain. This technology allows for the creation of decentralized databases and
storage that help trace commodities across the supply chain. Blockchain enables
businesses like healthcare and banking to have safe access to data. Blockchain, for
example, is a decentralized ledger that records and verifies transactions in a way
that avoids fraud and corruption.

Transportation. People and goods may now move more easily because to

advancements in air and fast train technologies. Changes in shipping logistics
technology also make it easier to transport raw materials, components, and
completed goods throughout the world..

Manufacturing. Manufacturing industry geographic limits have been decreased

because to technological advancements such as automation and 3D printing. Digital
designs may be transferred anywhere and physically created via 3D printing, making
dispersed, small-scale production closer to the point of consumption simpler.
Automation improves productivity by speeding up processes and supply chains,
allowing workers greater freedom..
Changing the way nations conduct commercial and financial exchanges and
interactions encourages cultural interchange. Geographic limits, political boundaries,
and political economy are no longer impediments.

Globalization, for example, allows enterprises in one country to use the resources of
another. The way goods are produced, supply chains are handled, and companies
communicate changes as open access becomes more prevalent. Businesses seek
out lower-cost raw materials and parts, lower-cost or higher-skilled labor, and more
efficient product development methods.

Globalization gives opportunity for expansion by removing trade constraints.

International competition is boosted by increased commerce. This, in turn,
encourages innovation and, in certain situations, knowledge transfer. Furthermore,
those that come to do business and operate in the United States bring their own
cultures with them, which affect and blend with other civilizations.
Globalization's myriad forms of commerce may have both beneficial and harmful
consequences. For example, cross-border exchanges of people and things may
generate new ideas and benefit businesses. This movement, on the other hand, has
the potential to transmit illness and propagate views that might destabilize political
economies.

Types of globalization: Economic, political, cultural

There are three types of globalization.

1. Economic globalization. The focus here is on international financial

market integration and financial exchange coordination. Economic
globalization is exemplified by free trade agreements such as the North
American Free Trade Agreement and the Trans-Pacific Partnership.
Multinational companies (MNCs) play a significant role in economic
globalization since they operate in two or more nations.
2. Political globalization. National policies that link countries together
politically, economically, and culturally fall under this category. NATO and
the United Nations are examples of political globalization organizations.
3. Cultural globalization. This facet of globalization concentrates on the
technical and sociological reasons that cause cultures to merge. Increased
communication ease, the pervasiveness of social media, and access to
faster and better transportation are among them.

While the consequences of globalization may be seen, determining their overall

influence is more difficult. Globalization supporters typically regard certain outcomes
as beneficial, while detractors see them as harmful. A partnership that helps one
entity may harm another, and whether globalization benefits the entire globe is still
debated.
 Answer # 2:

INTRODUCTION

You'll need solid infrastructure, financial and human resources, transportation,

buyers, and, most importantly, a safe and secure location to start any business.
However, fresh investment and corporate growth have been significantly hampered
throughout the world because to the potential hazards posed by the COVID-19
pandemic. While many nations struggled to cope with the crisis, the Saudi
government took swift steps to safeguard the safety of residents and enterprises. I'd
want to work in an online fashion store in Saudi Arabia, and I've included some
crucial insights below to assist you negotiate the fast-paced fashion e-commerce
market in the kingdom.

1. POTENTIAL COMPETITORS

Saudi Arabia has experienced a retail boom in recent years. The retail industry is
increasing at an 11 percent rate, thanks to a young population with a median age of
only 29 years (among the highest in the world). Consumer spending increased 18
percent year over year2, and the 2016 AT Kearney Global Retail Index ranked the
country eighth globally.
Single-brand merchants can now own 100% of their retail and wholesale
businesses. Mall owners, real estate developers, and fashion labels are all placing
significant bets on the Saudi market. E-commerce will soon follow.
E-commerce accounts for only 2% of total retail sales in the Middle East ($3
billion), but is anticipated to grow to $70 billion by 2025, thanks to many new
entrants.
One of the main beneficiaries of Saudi Arabia's retail development is fashion.
Despite restricted societal conventions dictating dress and looks, interest and intent
are prospering in men's and women's clothes, apparel, footwear, and accessories.
• In 2016, Jolly Chic and Shein witnessed a significant increase in interest and
were among the most searched brands.
• International and regional e-commerce firms such as Namshi, ASOS, Souq, and
Net a Porter will be vying for a piece of the Saudi fashion pie.
• Price, choice, convenience, and experience would all play a role in success.

Following are some major Competitors within KSA Online Fashion Industry
Total Growth
# Online-Store Parent Company
revenue '20/'21
1 next.sa Next Retail, Ltd. > US$50m 125%
2 jollychic.com Jollychic Ec, Ltd. > US$30m -4%
3 extra.com United Electronics Company > US$75m 26%
 4 adidas.com.sa The adidas Group > US$10m 33%
5 ounass.com Al Tayer Insignia, LLC > US$1m -7%
6 niceonesa.com Nice One > US$40m 78%
Afaq Q Tech General Trading
7 amazon.sa Co. > US$100m 316%
8 ubuy.com.sa Ubuy Corporation > US$10m 0%
9 sidewalk.sa Sand Steps Trading Est. > US$1m 12%
Arabian Luxury Gifts
10 swarovski.sa Company Limited, LLC > US$1m 40%
11 vogacloset.com VogaCloset, Ltd. > US$1m 6%
12 femi9.com Fad International, LLC > US$1m 44%
Kutayba Yusuf Alghanim &
13 xcite.com.sa Partners Holding Co., LLC > US$10m 31%
mamasandpapas.com.s
14 a Nebras Arabia, LLC > US$1m 9%
15 nejree.com Najri > US$0m 45%

2. COMPETITIVE ADVANTAGES

Because today's customers are on the go, internet connected, aware on worldwide
trends, less loyal, and search for quality items at reduced rates, innovation is also
critical in the fashion retail business to match customer demand and develop a
competitive advantage (Vasiliu and Cercel, 2015).
 From the literature, the following are some of the most extensively used and
growing fashion retail innovation techniques, both online and offline

 Virtual fitting room (VFR): a new retail service that uses augmented reality
(AR) to allow consumers to try on and match garments and accessories in
real time using their camera (Kose and Akgul, 2016).

 Retail price and promotion innovation enables merchants to better gather

data, tailor offers, and target customers based on time, location, other
personalisation features (Grewal et al., 2011).

 When consumers are near a store, personalized location-based promotions

are utilized to send SMS messages to their mobile devices with promotions
that they might be interested in (Grewal et al., 2011).

 Magic mirrors are LCD screens based on AR technology that are used in
stores to provide customers the possibility to try and match fashion products
in a virtual setting without having to physically try on clothes (Kose and Akgul,
2016).
  Another potential new technology in offline fashion shopping is the 3D body
scanner, which enables for mass customisation of items as well as precise
body measurement (Kose and Akgul, 2016).

 Self-creation and design, as well as client participation in the production and

acceptance of the final product, are two ways mentioned in Pantano to
address the customer's need for unique products and services (2014).
Zara has a competitive edge in that their advertising costs are only 0.3 percent of
overall costs. Rather than advertising, they employ the tactic of being present in
several cities and nations. Zara also relies on its sales personnel to provide the
greatest possible service to their customers, so with a positive experience, they rely
on word-of-mouth marketing, which Zara considers to be the most effective kind of
marketing. However, this competitive advantage is not long-term; competitors may
simply copy the interior design, customer service, and word-of-mouth advertising.
Zara must always be inventive in order to maintain that advantage. This marketing
strategy is used all throughout the world, especially in the Middle East.

3. INTERNATIONAL STRATEGIES

Foreign businesses should be aware that the Middle East is culturally complex, with
multi-ethnic and multi-country consumers" 38, and that these different demographics
must be considered when developing a brand image. There are distinctions in how
Western and Middle Eastern brands sell their products. Middle Eastern commercials
clearly highlight traditional Muslim values, whereas American advertisements
emphasize ideals and locations in opposition to traditional Islamic values. Because
numerous Middle Eastern countries follow Sharia law, it is critical for firms to
determine what kind of advertising campaigns people would allow. "All areas of
Muslim life, including daily routines, family and religious responsibilities, and money
dealings," according to the legislation.
Jollychic takes full use of its position as an industry leader to lead and contribute to
the creation of an E-commerce ecosystem in Saudi Arabia, therefore assisting the
Kingdom in developing a diversified digital economy and achieving Vision 2030.
They inked an agreement with SAGIA to offer Jollychic with complete support in
order to help promote the local e-commerce business and ecosystem in Saudi
Arabia. Dr. Mazin M. Al Zaidi, Director of Innovation and Entrepreneurship at SAGIA,
said, "Jollychic is a successful example of a firm that is actively creating employment
and supporting social progress in the digital economy sector of Saudi Arabia."
"Through a long-term growth strategy, we want to see more digital businesses
succeed in Saudi Arabia," he says. Relying on the solid foundation and business
vision of Jollychic in Saudi Arabia, the MoU also captures key content about the e-
commerce ecosystem and digital economy in Vision 2030. 
From : https://www.arabnews.com/node/1464656/corporate-news
The Alshaya Group, which is a franchisee of H&M, is the company's leader in the
Middle East. Alshaya Group began operations in 1890 and has since expanded into
a variety of industries46. They are one of the biggest franchisees in the Middle East,
representing multinational brands including H&M, Starbucks, Peugeot, and Estee
Lauder.
Aside from franchising, H&M has a global marketing strategy based on the premise
of high-quality clothing at a cheap price. Marketing is accomplished through
interacting with customers through traditional advertising, radio, movies, billboards,
and magazines. Newspapers and billboards are the most effective means for H&M to
contact its customers. The ads are placed in densely populated places such as cities
and retail malls. When developing the campaign, H&M takes into account the cultural
distinctions between each nation. H&M's advertising spend is 4-5 percent of their
annual net sales.
Answer # 3

INTRODUCTION

Saudi Arabia is really the only GCC region where foreigners make up less than half
of the population. It's the only market where locals make up 72 percent of the
population (in UAE, that number is 12 percent ). This implies that as a fashion
shop, you must adapt to the demands of the local market. Given the high
prevalence of internet and mobile phone use in Saudi Arabia (everyone is online),
digital platforms provide merchants with a plethora of data and trends that aid in
the development of their company and marketing strategies.
Digital trends provide insight into the thoughts of your customers, whether you're
an offline store, a pure-play eCommerce operator, or an omni-channel retailer. You
may tailor your Ramadan plans to match the demands of your customers by
looking at what they watch on YouTube and search for on Google.com. This
involves merchandising your Ramadan collections, price strategies (sales,
promotions, etc. ), communication planning (message, targeting, language, etc. ),
and identifying how to gauge performance.
In terms of fashion customer expectations, we're seeing a paradigm change in the
region. The days when being a successful fashion shop meant making brands
available to customers and then pushing them hard are long gone. The modern
fashion buyer is more educated, savvy, and connected than ever before.
Consumers want to be thrilled by the buying experience, which includes quick and
easy checkout, tailored suggestions, and so on.

1. GOVERNMENT AND POLITICS

GOVERNMENT SYSTEM
Saudi Arabia's governance and administration are based on the unitary Islamic
monarchy and hereditary dictatorship. The country is ruled by the Wahhabi
conservative religious movement within the Sunni faith. Saudi Arabia's current King
and Crown Prince is Muhammed-bin-Salman (MBS).

The constitution of Saudi Arabia prohibits the creation of any political party. The
King, on the other hand, must adhere to Islamic Sharia law.

POLITICAL STABILITY
Under the leadership of the king, Saudi Arabia boasts a stable political climate. Many
detractors, however, debate with the term "political environment" in Saudi Arabia.
They assert that because there are no political parties in the nation, there is no
political climate. It's basically absolute monarchy and totalitarianism, with the King
wielding ultimate authority.

ROYAL FAMILY
Suadi Arabia's political atmosphere is dominated by the royal family. According to
estimates, around 200 male descendants of the Ibn Saud dynasty control the
country's 7000 princes. However, major ministry positions are reserved for members
of the royal family and princes.

ALLIANCES
Saudi Arabia is a member of OPEC, the Arab League, the Organization of Islamic
Cooperation, the United Nations, the Gulf Cooperation Council, and other
international organizations.

2. FORMAL TRADE BARRIERS

Saudi Arabia has taken positive steps to become a more open, transparent, and
predictable market as a member of the World Trade Organization (WTO); however,
US companies report encountering market barriers in the areas of protection of
intellectual property rights, technical standards and regulations, effectiveness and
localization requirements, delayed payments, dispute settlement, and the Arab
League boycott.

From : https://www.trade.gov/country-commercial-guides/saudi-arabia-trade-barriers

3. PROMOTING GLOBAL BUSINESS

Saudi Arabia's e-commerce ecosystem has followed the global trend. It includes
demand side buyers, such as consumers and businesses, supply side buyers, such
as pure-play e-commerce providers, traditional retailers, SMEs, and consumer-to-
consumer (C2C) sellers, and various enablers, such as government and regulatory
bodies, technology and connectivity providers, payment gateway and services
providers, and logistics companies. Currently, Saudi e-commerce is undergoing a
significant transformation as all players work to make the e-commerce business
more growth-oriented and development-friendly.. The industry is steadily evolving, as
seen by a number of new announcements, acquisitions, and government initiatives,
as well as the disruptive transformation of the conventional retail market in hybrid
sellers who are steadily adding new capabilities. Each ecosystem participant has
distinct traits and a critical role to perform, which will be addressed in more detail in
the following sections.
From : CITC E-commerce Research, 2017

4. INTELLECTUAL PROPERTY

Since April 2019, Saudi Arabia has been on the US Trade Representative's Special
301 Report's Priority Watch List. Saudi Arabia has expressed a willingness to
improve its IP regime, although it presently lacks the necessary infrastructure. While
the Saudi Authority for Intellectual Property has achieved a lot of positive
breakthroughs and continues to make progress since its inception in 2017, there is
still a need for Saudi Arabia to address severe issues about IPR protection and
enforcement in the pharmaceutical sector.

From : https://www.trade.gov/country-commercial-guides/saudi-arabia-trade-barriers
5. E-COMMERCE IMPLICATIONS DUE TO TAXES AND LAWS IN UAE

E-commerce has remained one of the positive outcomes of technological

advancements throughout the world. Customers' expectations and choices appear to
have shifted dramatically as a result of the comfort and convenience provided by
numerous active virtual markets. As can be observed, the recent pandemic scenario
has ushered in a slow shift toward e-commerce as our preferred platform over
physical buying. The UAE government has always made a significant effort to foster
the growth of e-commerce in the country. Retailers and sellers in the nation have
been eager to investigate the commercial opportunities that e-commerce may
provide.

The Electronic Transactions and E-Commerce Law (Federal Law No 1 of 2006) in

the UAE allows for the electronic execution of contracts between two parties and
clearly says that contract permission and acceptance can be given through
electronic communications.

The risk of contracting in the this manner is that the method in which the terms &
conditions are provided to the consumer allows the customer to contest the
existence of any agreement. Steps should be taken to ensure that there is as little
room as possible for a disagreement over whether or not the customer has
considered and accepted the contract's terms and conditions. For example, rather
than having the terms posted in the 'legal' area of the website where the consumer
may or may not see them, have the customer 'click-to-accept' the conditions that
pertain to his or her purchase of products.

VAT in the UAE will make internet services and products more costly. Businesses
will face higher costs and lower profitability as a result of this. Consumers' budgets
will be shaken by the 5% price increase.

The goal of implementing VAT in Dubai was to not only diversify the government's
revenue stream, but also to streamline commercial operations in the city. There was
a drop in E-commerce sales at first. It took some time for internet businesses and
their consumers to adjust to the new laws and regulations and make necessary
budget adjustments.
Conclusion:
Finally, since the COVID-19 outbreak in this region, fashion shops should keep a
careful eye on various changes that have appeared and progressed quickly.
Consumers who previously refused to utilize e-commerce platforms now have no
choice but to do so due to the lockdowns. Even after the epidemic has gone, it is
quite likely that people will continue to purchase online. Even after the removal of
lockdown measures and social distancing norms, it is clear that GCC consumers'
digital and online involvement would grow more persistent and wide. Fashion
merchants will need to use data analytics to find customers and fulfill their needs in
this multidimensional and complex digital world.. Retailers must also strike the
correct balance between their e-commerce and brick-and-mortar locations.
Consumers are experimenting with novel shopping methods such as showrooming
(viewing items at B&M shops before purchasing online) and webrooming (evaluating
products online and then buying the final selected product in a B&M store). Retailers
must consider pricing and value aspects as they target more digitally smart and
Internet educated customers on both e-commerce and in-store channels. The
lockdown measures have boosted the popularity of digital payment and wallet
solutions, and ensuring a safe and secure payment gateway is critical to maintaining
customer trust. COVID-19 has emphasized the significance of consumer health,
wellbeing, and sustainability.. Customers' increasing consciousness of the
environment and social responsibility will require retailers to produce sustainable
items. In such epidemic times, fashion retail will need to combine all of the
aforementioned factors into their business plans to thrive. The critical levers for
survival for their supply networks will be agility, resilience, and adaptability. Retailers
who serve to these digitally aware consumers with an OC fulfilling solution will
survive in the aftermath of the epidemic, in a fickle customer loyalty climate.
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