Question

What are the three examples of commodity chain organization? Give actual examples of these relationships and explain how they represent globalization. (8-12 sentences)

Answer 1

Globalization refers to the process of believing that the entire world is one big economy from which you can get resources, manufacture a product and sell the same across the globe or in locations where demand of the products is consistent and may offer reasonable profits. Restrictions to trade under this model are restricted as far as technically possible.

Over the years, this concept has extended to numerous companies enabling this as part of their production technique wherein they would procure goods from one place, design them in another and produce these goods at a different location. All of this has made innovation a relatively easier exercise and the overall cost of production has gone down sharply as a result of this.

The following are 3 Critical Example of Companies which have enabled themselves to have this form of production and have become globalized in the process.

Examples: -

As a company, Apple is well known to produce its product in China, design them in the United States and parts may be sourced from as far as Korea, Vietnam, Thailand etc.

Similarly, Samsung as a company originates from South Korea, however its production lines extend as far as China and all markets including the United States and India are major partners in sales and should largely therefore be seen as a global process of procurement, production and sales.

One additional company to do so in an industry apart from electronic gadgets is that of Nike which manufactures most products in countries such as China, Vietnam etc. while sourcing its raw materials from China, India, Turkey etc.  

All of the above examples, highlight the importance of a commodity chain organization wherein it produces products which are sold across most major countries of the world, whereas different steps of the production process right from designing to manufacturing and marketing take place in different areas thus enabling collaboration and globalization wherein there are no restrictions and the entire world economy is considered unified and singular.

Please feel free to ask your doubts in the comments section.