Globalisation is the process by which businesses or other organizations develop international influence or start operating on an international scale. UK manufacturers should operate globally because offshoring and outsourced labour, especially overseas labour often includes technically skilled, highly educated and multilingual workers who are willing to work for much less than typical UK wages. The advantage of having support workers who can respond to global customers in many languages is extremely important for UK businesses. For example, General Electric used offshoring to develop its largest multidisciplinary, integrated R&D hub, in India. The hub supports the company globally and has generated a large Indian talent pool with strong onsite leadership. Another reason is that it's cheaper to rent a factory overseas and its workers, than to maintain them yourself. Many contract manufacturers offer services beyond production. They may store and ship products as well, and charge either for the space used or the services bought. The availability of cheap overseas labour is one of the biggest advantages of outsourcing. Globalization lets countries do what they can do best. If, for example, you buy cheap steel from another country you don’t have to make your own steel. Countries can focus on i.e. computers or other things. For example India leads the world in banana production, producing around 18%. This would help the UK’s imports and exports markets thrive. On the other hand globalization of UK businesses may lead to more environmental problems. A company may want to build factories in other countries because environmental laws are not as strict as they are at home. For example poor countries in the Third World may have to cut down more trees so that they can sell wood to richer countries. Human, animal and plant diseases can spread more quickly through globalization. Furthermore Globalization can lead to financial problems. In the 1970s and 80s countries like Mexico, Thailand, Indonesia or Brazil got a lot of money from investors who hoped they could build up new businesses there. These new companies often didn’t work, so they had to close down and investors pulled out their money. All of these issues could potentially negatively impact a UK business because if they act unethically they could generate a poor brand image. In evaluation the average family in the UK is around £7,000 a year better off, due to reduced costs for goods and services due to the impact of globalisation. This has helped to sustain a record period of economic growth and prosperity within the UK. However the costs will be present in future years as wages inevitably converge lower towards the East Asian wages for competitive reasons. I.e. when a high paying manufacturing job is lost, it is likely to be replaced by a lower paying service industry job. Whilst I don’t think that UK manufacturers need to operate on a global scale in order to succeed, once a business expands to a certain point, I believe that it will need to expand globally in order to keep growing.
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