The student correctly concluded that the factory producing sports shoes for a multinational brand is part of the globalised economy, while the small local unit operates only in the domestic market. The two setups differ in several important ways.
A student interviewed two factory owners – one producing sports shoes for a multinational brand and another running a small local shoe unit. After the discussion, the student concluded that the first was linked to the globalised economy, while the second operated only in the local market. Analysis the key differences between these two production setups that must have enabled the student to reach this conclusion.
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The student correctly concluded that the factory producing sports shoes for a multinational brand is part of the globalised economy, while the small local unit operates only in the domestic market. The two setups differ in several important ways:
The multinational-linked factory works on a large scale, producing goods for both domestic and international markets, whereas the local unit operates on a small scale, catering mainly to local customers.
The global brand uses advanced machinery, modern technology and strict quality control to meet international standards. The local unit, on the other hand, usually relies on traditional methods and has limited access to new technology.
The multinational factory has huge foreign investment and capital, often supported by global partnerships. The small local unit is run by local capital and limited financial resources.
In the globalised setup, workers may get better training and sometimes higher wages, but they also face pressure to meet deadlines. The local unit employs fewer workers, often informally, with less job security or benefits.
The multinational-connected factory is linked to the global supply chain, exporting goods and importing raw materials. The small unit sells only within the local market, with no international connections.
The multinational brand benefits from global marketing, advertising and brand recognition, while the local unit depends on word-of-mouth and local customers for survival.
Conclusion:
The student recognised that the factory tied to a multinational brand was part of a globalised production system, connected to foreign markets, technology and capital, while the small local unit was limited to the domestic market with local resources and reach. These differences clearly show the contrast between a globalised and a non-globalised production setup.