With the industrial revolution came a new era of trading goods and a redefined global market. It became easier and easier to form a network of interdependence between nations, and more importantly, cheaper to buy a pair of jeans. Using our connectedness, we are now exporting labor thousands of miles over seas, and reaping the benefits of these commodity chains. A commodity chain is the process in which resources needed are gathered, and transformed into products for consumers. With the boom of transportation, this process is becoming less and less costly, as we reach out to where the resources are the cheapest, and where the labor to create the products is lowest. Mximizing, and increasing a brand's profits considerably The topic of commodity chains is not one that can be depicted in black and white, and there is not one solution to the problems at hand. The following three factors are going to be traversed within this analysis: An explanation of modern commodity chains, pros of these commodity chains, and cons. Along with these three points, I will discuss a commodity chain of my choice, and how this specific instance fits in with the two perspectives. There are 3 types of commodity chains: Producer Driven- Where the creator controls the price of the product, like the pharmaceutical industry. Consumer Driven- Where the amount and price of product is driven by the need. Marketing Driven- A hybrid between both of the above. (Knox and Marston. 2013). While there are these three types of chains, there is not one particular model for which they are implemented. Rather, there are two general methods used: basic and comprehensive. An example of a basic methodology is the a brand would commission a factory to produce ... ... middle of paper ... ...ithin the factories, the key phrase is potential. There are many more instances of suffering, and illegal practices all in the name of making an extra few dollars on a product. The report on Old Navy and Gap policy is an example of all that could go right, (with a code of conduct), but in reality, all that goes wrong. Works Cited Institute for Global Labour and Human Rights (2013) Gap and old navy in bangladesh: cheating the poorest workers in the world. Pittsburgh, PA: Charles Kernaghan Knox and Marston, Chapter 7 (2013) 238-246,Chapter 2, 51-52 Kristoff (2009) “Where sweatshops are a dream”, New York Times, 15th January,1-3. Silverstein (2010) “Shopping for Sweat: the human cost of a two-dollar T-shirt”, Harper’s Magazine, 36-44 Verma and Elman (2007) “Labour Standards for a Fair Globalization for Workers of the World” The Good Society, 16, 2, 57-64
RNRA Team, “Supermarkets, Fresh Produce and New Commodity Chains: What Future for the Small Producer?” Hot Topics: February, 2004.
The Industrial Revolution was a fundamental change in the production of goods that altered the life of the working class. Similar to most other historical turning points, it had skeptics, or people that doubted the change, and fanatics, people who saw the value in the change being made. The Industrial Revolution and the period that followed shortly after highlight these varying opinions, as people were more conflicted than ever about the costs of industrialization. While industrialization started in England as an attempt to capitalize on the good fortune they had struck, it quickly developed into a widespread phenomenon that made the production of goods more exact and controlled by higher level people. Many industries, such as the cotton and textile businesses, were previously run through organizations called “cottage industries”.
Target Corporation pioneered value chain activities like focusing on customer experience through superior marketing, ability to attract global talent, sustain in and outbound supply logistics, develop supplies with a high-quality vendor and partners, a great customer service, extend return by 30 more days if purchased through Target brand store cards, and a skilled workforce supports its generic strategy of "Expect more Pay Less" improves competitive position that its rival cannot match. --
Linda Lim, a professor at the University of Michigan Business School, visited Vietnam and Indonesia in the summer of 2000 to obtain first-hand research on the impact of foreign-owned export factories (sweatshops) on the local economies. Lim found that in general, sweatshops pay above-average wages and conditions are no worse than the general alternatives: subsistence farming, domestic services, casual manual labor, prostitution, or unemployment. In the case of Vietnam in 1999, the minimum annual salary was 134 U.S. dollars while Nike workers in that country earned 670 U.S. dollars, the case is also the similar in Indonesia. Many times people in these countries are very surprised when they hear that American's boycott buying clothes that they make in the sweatshops. The simplest way to help many of these poor people that have to work in the sweatshops to support themselves and their families, would be to buy more products produced in the very sweatshops they detest.
The Industrial Revolution was the major advancement of technology in the late 18th and early 19th century that began in Britain and spread to America. The national and federal government helped the United States grow into a self reliant nation with improvements in transportation, technology, manufacturing and the growth of the population. Americans had an economy based on manual labour, which was replaced by one dominated by industry and the manufacture of machinery. It began with the expansion of the textile industries and the development of iron-making techniques, and trade expansion was enabled by the introduction of canals, improved roads and railways. One of the first to kick off, was the textile industry.
Some companies have made strides in abolishing sweatshops in their business. Fruit of the Loom is one of those companies taking the strides. They are “the fourth college-logo apparel company to sign the Bangladesh Safety Accord, an agreement between unions and brands that will transform the Bangladesh garment industry from deathtraps to safe work places” (Fruit of the Loom). Adidas is another company who signed the same deal. Even though Fruit of the Loom is no Gucci or Prada, hopefully people will start to realize that some companies are taking the extra step to help people while others are merely taking advantage of those less fortunate.
The value chain analysis can be examined as to whether they provide opportunities for differentiation or cost reduction. According to Porter, the value chain model is a useful analysis tool for defining a firm's core competencies and the activities in which it can pursue a competitive advantage by following one of the two strategies:
Gereffi’s more recent research with Joonkoo (2005) sees the evolution of the Global Commodity Chains approach into the theory of Global Value Chains. This new approach encompasses much of Smith et al’s criticisms of Global Commodity Chains. The new theory links the concept of value in chains with the global organization of industries. It incorporates governance as a key influence on the chain and sees the hybridization of producer and buyer driven chains.
A supply chain is a system through which organizations deliver their products and services to their customers. The network begins with the basic ingredients to start the chain of supply, which are the suppliers that supply raw materials, ingredients, and so on. From there, it will transfer the supplies to the manufacturer who builds, assembles, converts, or furnishes a product. The chain now needs to get the product to the consumer by transporting the finished product from the manufacturer through a warehouse or distribution center. An example is that Wal-Mart has a nearby distribution center where products are delivered there and then split up to be delivered to a retail Wal-Mart. “Wal-Mart will take responsibility for breaking down larger loads and delivering the product to other Wal-Mart stores” (Ehring 1).
Value chains are essential elements of successful businesses, and how to gain a competitive advantage by analyzing them is the most important aspect. In Porter’s value-chain model, he points out that there are two types of business activities: primary activities, which include inbound logistics, operations, outbound logistics, marketing, sales and service; and support activities, which include procurement, technology development, human resources management, and firm infrastructure. In order to gain an edge, companies should focus on these activities to improve or create products that will satisfy their customers.
This paper describes the legal, cultural, and ethical challenges that confronted the global business presented in the Nike sweatshop debate case study. The paper determines the various roles that the Vietnamese government played in this global business operation. This paper summarizes the strategic and operational challenges facing global managers illustrated in the Nike sweatshop case.
A working relationship with suppliers to build a supply chain that is sustainable can help the company cut cost, create new sources of revenues, better manage business risks, and build the value of their brand. Through efforts, such as improved energy efficiency and streamlined supply chain logistics, Nestle can considerable reduce it cost thus increase profitability in the future. It is also recommended that Nestle should incorporate bottom line sustainability issues into its corporate risk management as this would work towards reducing risk. Show casing innovative solutions to negative impacts of the supply chain operations can work towards brand value. Therefore, sustainable supply chains can reinforce Nestle’s commitment to remaining profitable for the benefit of the company’s
The 4 market structures in relation to the benefits and costs to the consumer and producer
represent the point in the supply chain at which goods and conveyances are most vulnerable.
A chain value is a diagram that a company uses to decide its activities up into component parts such as its functions or management from top to bottom or vice versa. Example