Outsourcing and Nike Shoe Industry
A. Outsourcing Advantages:
1. It is currently a growing market. The expansion of this results in a larger variety of the market. Due to the increase of usage, businesses have more experience, which in turn decreases the risk.
2. Wider range of technology at low cost is a main advantage. BY outsourcing companies can reach out and acquire the necessary resources and skills to keep their technology to date.
3. Production costs could be much lower. Hiring large numbers of workers would be possible due to the lower cost. This in turn would increase production.
4. Depending on the area, taxes would probably be much lower than in the states. The money saved from taxes would quickly add up.
5. By maintain lower rates from the advantages mentioned above, sequentially, there would be an advantage over competitors.
B. Outsourcing Disadvantages:
1. It would be much harder to manage an outsourced sector of a company than one owns. Communication with employees would be slightly difficult.
2. Lay offs or rate decreases for their home employees can become largely criticized. Many believe it may be able to hurt the economy.
3. By changing to areas not very known, business conditions, lack of internal and external customer focus and sharing cost savings can be a disadvantage.
4. There can be a threat to security and confidentiality. If a company outsources payroll, medical transcriptions or other confidential information, there is a risk of exposure.
5. There could be a lack of customer focus. For example, if one company is faced with running many organizations through outsourcing, there could be a lack of knowledge in knowing what the customer wants.
C. The Nike shoe industry is one of the most popular shoe companies, due to its large demand; I would outsource its production of shoes. By outsourcing manufacturing the shoes will provide a larger production rate and come with a lower cost. This will decrease the cost of purchasing the shoes, which will in turn
1. It is currently a growing market. The expansion of this results in a larger variety of the market. Due to the increase of usage, businesses have more experience, which in turn decreases the risk.
2. Wider range of technology at low cost is a main advantage. BY outsourcing companies can reach out and acquire the necessary resources and skills to keep their technology to date.
3. Production costs could be much lower. Hiring large numbers of workers would be possible due to the lower cost. This in turn would increase production.
4. Depending on the area, taxes would probably be much lower than in the states. The money saved from taxes would quickly add up.
5. By maintain lower rates from the advantages mentioned above, sequentially, there would be an advantage over competitors.
B. Outsourcing Disadvantages:
1. It would be much harder to manage an outsourced sector of a company than one owns. Communication with employees would be slightly difficult.
2. Lay offs or rate decreases for their home employees can become largely criticized. Many believe it may be able to hurt the economy.
3. By changing to areas not very known, business conditions, lack of internal and external customer focus and sharing cost savings can be a disadvantage.
4. There can be a threat to security and confidentiality. If a company outsources payroll, medical transcriptions or other confidential information, there is a risk of exposure.
5. There could be a lack of customer focus. For example, if one company is faced with running many organizations through outsourcing, there could be a lack of knowledge in knowing what the customer wants.
C. The Nike shoe industry is one of the most popular shoe companies, due to its large demand; I would outsource its production of shoes. By outsourcing manufacturing the shoes will provide a larger production rate and come with a lower cost. This will decrease the cost of purchasing the shoes, which will in turn