Walt Disney & Avon Essay Example

fall in customer numbers following the political stand, which goes against the American culture of inclusivity (Livermore, 2010).

A good way to know the involvement of a company is through campaign donations, which indicate that a given company is favoring a given candidate. Considering the domestic market comprises diverse populations from different regions of the world. Consequentially, if Disney supports a political regime that has an aggressive foreign policies that affects the regions where many immigrants come from, the company could suffer a slump in the domestic market (Thomas & Inkson, 2009). This is because immigrants are a substantial part of the American society.

The legal environment will also affect the performance of Walt Disney. For instance, legal changes laws that seek to increase taxes on makers of legal contents will affect the ability of the company to make high revenues. As a result, profitability of the company will dwindle significantly. Another way to look at the impact of the legal environment is through the various laws that raise the risk for the company by increasing contingent and legal liabilities (Henning, 2011). Employment laws are a good example that may affect the business performance of the Walt Disney.

Employment laws that may force companies to increase minimum wage is definitely going to affect the ability of the organization to generate higher revenues because cost of labor is one of the leading costs of business operations. The company may also find itself suffering huge risks due to laws such as employment discrimination laws. Specifically, equal employment opportunity laws that govern the concept of adverse impact on employment have the potential to affect the company’s profitability. Education laws, which govern

child education, are also likely to affect the company because it uses children actors on set and must ensure compliance to such laws (Handlin, 2011).

Avon’s Political and Legal environment

Avon Product Company is a manufacturer that has an international outlook. McConnell founded the company in 1986 in New York City. The company has enriched the lives of Americans in one way or another for over a century making it crucial for legal and political environment analysis. As a global company, the company is both an international brand as well as a force to reckon with in the local market. As a global brand, Avon is likely to be affected, in many ways, by political and legal factors at the domestic and international level.

A good place to start the analysis is the political instability that rocks major regions of the world. For instance, Africa has established and growing economies; thus presenting a mixture of established and growing markets. Sadly, the region experiences political wrangles frequently. The political instability in these regions affects how a company like Avon conducts trade in such regions (Gekonge, 2014). In politically unstable regions, Avon will be forced to withdraw its investments in politically unstable markets to avert losses that stem from the political wars.

On the same note, the company’s ability to compete will be greatly crippled in markets where political regimes have protective policies. A good case in point is China. The Chinese government implements policies that protect its young and growing manufacturing plants from competition by international especially western companies (Kepping, 2009). This aspect may also play out in the domestic market because if the political regime has a foreign aggressive

policy against a given region, immigrants- a substantial part of the America population-may boycott the products from American governments.

Additionally, if the political regime at home enters into bilateral trade agreements, Avon may lose a substantial market share and profits because many international manufacturers especially from Asia have a lower labor cost advantage that makes their cheaper compared to American companies. This was practically observed in the motor vehicle manufacturing industry where japans motor vehicle manufacturing companies toppled the American manufacturers.

Another way to approach the effect of political factors on company performance is through regional integration. Regional integration is happening all over with many governments creating regional partnerships, which allow free flow of products on across many borders. This presents Avon with the opportunity to obtain huge market shares, as well as, to get cheap sources of labor (Gekonge, 2014). This will increase the competitiveness of the company on the global market because it can offer products at cheaper prices.

Legal environment has mixed implications for Avon at both global and domestic markets. For instance if taxation laws are tightened in the new market s such that imported products are taxed highly than local products, the imports will be unfavorable to the market. Similarly, if the domestic market does not tax imports heavily, Avon is likely to lose to competitors who can spend less on production thus providing their products at lower prices.

Still on the domestic front, labor laws and policies may affect the costs of operations of the company especially where such labor requires higher wages to be paid to lower employees who happen to populate the lower ranks of the company. Similarly, failing to comply

with legal regulations especially those concerning corporate Governance and accounting may prove costly for the company as is the case with many companies observes Henning (2011).

The above research presents the effect of political and legal environments on a company both at the domestic and international levels. The research revolves around two giant American companies that have prevailed through tough economic times to enrich the lives of Americans. The first part looks at how the local domestic politics and legal environments would affect Disney. Lastly, the second part looks at political and legal developments around the world at home. Additionally, the paper looks at how such political and legal factors would mean for Avon Products Company.

1. References
   Gekonge, C. O. (2014). Emerging business opportunities in Africa: Market entry, competitive strategy, and the promotion of foreign direct investments. Hershey, PA: Business Science Reference.
2. Handlin, A. H. (2011). Government grief: How to help your small business survive mindless regulation, political corruption and red tape.
3. Santa Barbara: Praeger. http://ezproxy.apus.edu/login?url=http://www.netlibrary.com/urlapi.asp?action=summary&v=1&bookid=369621
4. Henning, J., P., 2011). The High Price of Internal Inquiries. Retrieved on August 29, 2016 from  http://dealbook.nytimes.com/2011/05/06/the-high-price-of-internal-investigations/?_r=0
5. Keping, Y. (2009). Democracy is a good thing: Essays on politics, society, and culture in contemporary China. Washington, D.C.: Brookings Institution Press.
6. Livermore, D. (2010). Leading with cultural intelligence: The new secret to success. New York: American Management Association.http://site.ebrary.com/id/10342361
7. Peng, M. W. (2013). Global business. Cincinnati, OH: South-Western Cengage Learning.
8. Thomas, D., C., & Inkson, K., (2009). Cultural intelligence: Living and working globally. San Francisco: Berrett-Koehler Publishers.