Many companies can experience growth as time passes but to remain viable these companies must continue to compete in the global market. Growth can bring a lot of advantages for example bigger brand name, international market shares, different investors, more resources for income, and even the capability to produce a product for less labor cost. Regardless of the reasons why a company desires to grow internationally, this changeover won't take place without a great number of problems or hurdles. The greatest problems a company may encounter could be the moral and social dilemmas that they will encounter every time they get into a new market in a different country. We will talk about this kind of example with the Levi Strauss and Company and the entry into the international markets. Cultural Issues when Facing a Global Organization Levi Strauss and Company, based in San Francisco, California is actually a world recognized brand and one of the world’s biggest apparel producers. Though established and based in the United States, they buy and operate plants in 110 different countries. Roughly one half of their annual net income is from sales beyond the United States. A few years ago, Levi Strauss and Company came under fire from many foreign organizations to incorporate stockholders, media sites, investment companies, and unions. The reason was an inspection of two plants situated in Bangladesh uncovered the company was employing children to do the work. And while the minimum age within the United States is 16 years and a fixed maximum number of hours are permitted to work, in Bangladesh, it is quite common for children younger than 15 to be doing the job and helping a whole family from their salaries. Additionally, in Bangladesh so... ... middle of paper ... ...make sure that they are doing business in a moral way. Many times, it is not enoug to issue a memo or handout and hope the workers will follow it. Education and training are a continual thing and should be provided across the company. Conclusion These days, many companies are getting into the international market in hopes of growth as well as an increase of earnings. The issue at times ignored in this process happens to be the social factors as well as moral factors. These types of factors are also always modifying since they get into a new country to do business. One “universal” method won't be sufficient in an effort to maintain policy. Arrangements as well as education are essential to the organization's survival in an international market. The more of this they actually do, the better organized they will be in following their moral as well as social obligations.
Throughout time children have worked myriad hours in hazardous workplaces in order to make a few cents to a few dollars. This is known as child labor, where children are risking their lives daily for money. Today child labor continues to exist all over the world and even in the United States where children pick fruits and vegetables in difficult conditions. According to the article, “What is Child Labor”; it states that roughly 215 million children around the world are working between the ages of 5 and 17 in harmful workplaces. Child labor continues to exist because many families live in poverty and with more working hands there is an increase in income. Other families take their children to work in the fields because they have no access to childcare and extra money is beneficial to buy basic needs. Although there are laws and regulations that protect children from child labor, stronger enforcement is required because child labor not only exploits children but also has detrimental effects on a child’s health, education, and the people of the nation.
With the constant quest for greater profitability, American companies are reaching further and further around the globe for opportunity. Factories are being built in third world countries, and sales efforts continue to increase in the world’s fastest growing economies like China and Brazil. Consumer products corporations, especially, are seeking out the cheapest and most efficient method of production, and many are beginning to look to Indonesia for answers. According to the Indonesian Footwear Association, “sports footwear produced in Indonesia is expected to soar roughly 25 percent to $1.6 billion since 2007,” (Abelson 1). One of the American companies leading the global initiative, New Balance Athletic Shoe Inc., alone expects to increase its number of shoes manufactured in Indonesia to almost 6 million pairs over the next couple years (Abelson 1). This vast migration of manufacturing facilities is lead not only by the hunger for corporate profits, but also by the new international system of globalization. This system destroys international barriers and allows for enhanced communication, efficiency and cultural understanding. When developing production operations in Indonesia, New Balance must be aware of both the cultural and geographical differences of the country, as explained by authors Thomas Friedman and David Landes, as well as the potential benefits and costs of globalization, explained by authors Amartya Sen and Paul Collier.
Today, many companies enter the global market, and some companies have become extremely successful in the global marketplace and others still struggling. In Theodore Levitt’s article “The Globalization of Markets”, he states that a well managed corporation focuses on selling standardized products with high quality and low priced instead of focuses on selling on customized products with high cost. Levitt defines the differences between multinational corporation and global corporation, and adopts many specific examples to proves his view. He defines the multinational corporation who operates in many countries and adjust its product based on the taste of specific region. This will result in a high cost to produce the product because company have to input more resource into each individual product. However, global corporation sells similar product worldwide at relative low cost. According to Levitt, the cultural differences are becoming more and more “homogenized”; therefore, becoming a global corporation will lead to the successful of the company in the global market.
Everyone knows the famous brand Levi Strauss and the wonderful products from the brand, but do you know the entrepreneur behind the brand. Do you know the struggles he went through, the life he lived that led him to be one of the best brand in the world. Levi Strauss isn’t just a brand it’s the success and the dream of an entrepreneur that came true.
This means not appreciating human capital and not investing in enhancing the skills that workers bring to the organization, leaving no room for workers’ growth. Moreover, due to high global competition, increase in outsourcing, and technology taking over, employers tend not to invest much in
This report is about Procter and Gamble Co., which is a consumer goods company headquartered in the US. However this report focuses on P&G’s perfume brands and cosmetics. The company’s brief introduction followed by the market analysis has been explained. Moreover its competitive environment using Porters five forces has also been analysed. Further analysis include the company’s growth strategies using Ansoff’s Matrix and the company’s drivers of internationalization examined using Yips framework.
Firms exist with the purpose of create and deliver economic value (Bensaco et al 2010, p. 365); therefore, business that create better economic value than its competitors will attain an advantage position in market place. Companies might try to improve its sales (profit) through domestic expansion, product diversification or by internationalisation; this report will focus on the reasons of espressamente Illy to expand internationally; additionally, its sources of competitive advantage and, the analysis of three markets in which company want to participate.
Globalization Phase, companies were known locally, regionally and internationally, their products were already improved offering innovative services. However, as The Economist (2007) has highlighted, while more global the companies are more aware of corporate social responsibility they need to be, namely, foreign stakeholders will expect, not only innovative and effective products, but also they will open their doors and invest their money to companies that are social responsible.
Child Labor is not an isolated problem. The phenomenon of child labor is an effect of economic discrimination. In different parts of the world, at different stages of histories, laboring of child has been a part of economic life. More than 200 million children worldwide, some are as young as 4 and 5 years old, are slaves to the production line. These unfortunate children manufacture shoes, matches, clothing, rugs and countless other products that are flooding the American market and driving hard-working Americans out of jobs. These children worked long hours, were frequently beaten, and were paid a pittance. In 1979, a study shows more than 50 million children below the age of 16 were considered child labor (United Nation labors agency data). In 1998, according to the Campaign for Labor rights that is a NGO and United Nation Labor Agency, 250 million children around the world are working in farms, factories, and household. Some human rights experts indicate that there are as many as 400 million children under the age of 15 are performing forced labor either part or full-time under unsafe work environment. Based upon the needs of the situation, there are specific areas of the world where the practice of child labor is taking place. According to the journal written by Basu, Ashagrie gat...
The same can be said about a localization strategy. Localization may give a firm a competitive edge, but if it is simultaneously facing aggressive competitors, the company will also have to reduce its cost structure, and the only way to do that may be to shift toward a transnational strategy. This is what Procter & Gamble has been doing. Thus, as competition intensifies, international and localization strategies tend to become less viable, and managers need to direct their companies toward either a global standardization strategy or a transnational
...enture into overseas market comes with expectations as well as uncertainties due to unfamiliarity. Charles and Keith, the fashion retailer, has to understand clearly that what appeals in one market might not be accepted in the others and this is almost the same for all industries. Thus, a thorough research on cultural background has to be done before entering an unfamiliar ground.
Globalization is the dominant force by which the world has become interconnected significantly as a result of extremely increased trade and decreased cultural differences. Globalization has made crucial changes in the production and trade of goods and services. The giant companies are now multinational corporations with subsidiaries in many countries. They are no longer national firms with their operations limited to the boundary of just one country. Such companies’ growth and operations are not constrained by any geographical, economical or cultural boundary. One of these multinational corporations is “Nestle”; that has gained world-class recognition in recent times. Nestle has made significant use of globalization in the last decade in the following manner-
In week five we learn about the importance of globalization and how it can help your company’s profits grow. There are many things to look at when selling globally as different cultures need to be looked at differently when making a marketing strategy. If you understand how to market your products to different cultures in different countries you can take advantage of the profits that can be made through globalization.
With the advent of the Internet, decreased shipping costs, and the removal of trade barriers, the world market has shrunk in such a way that everyone can be a player. While many businesses thrive solely on serving a small local area, a globalized company has the benefits of increased customer markets, gross production, and brand awareness. Take for example Coca-Cola; this multi-national corporation offers products in countries all over the world, operates in over 200 of those countries with the help of its franchisees, and is the most well-known beverage companies. It is interesting to note however, that as positive as globalization may seem, there are many negative ramifications and a large population of detractors to this movement. While increased product availability is good for profits, if a local market is inundated with imported products, locally grown or manufactured items may be squeezed out, to the detriment of the local economy. Although it is cost effective to have your product produced in another country with low wages, you are essentially taking away jobs from the people of your own country, negatively impacting your national economy. However, if you manufacture your products in a country with higher wages, you must increase your products’ prices which may be harmful to your profits. While maximizing your companies profits is always of great importance, it is essential that you weigh the pros and cons of globalization and its effects on not only your company, but the areas in which you wish to spread.
...C. & King, E.,2012. Journals of Cooperatives. [online]. Harrisonburg: Eastern Mennonite University. Available at:< URL:http://www.agecon.ksu.edu/accc/ncera210/JOC%20pdfs/V26/Gingrich.pdf. > [Accessed 20th Feb 2014].