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More Companies Produce Goods in The Factories Located in Different Countries - Task 2 Band 9 Essay

Updated: Mar 18

You should spend about 40 minutes on this task.

Write about the following topic:

More companies produce goods in the factories located in different countries other than the location of the head office. Advantages and disadvantages?

Give reasons for your answer and include any relevant examples from your own knowledge and experiences.

You should write at least 250 words.

Task 2 Band 9 Essay Sample Answer

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Model Essay 1

The global business landscape is increasingly characterized by companies relocating their manufacturing operations to countries distinct from their headquarters. This strategy, while economically rational, presents a mixed bag of outcomes, encompassing both significant benefits and notable drawbacks. The essay will explore the economic efficiencies achieved through reduced operational costs and the potential for enhanced global market engagement, alongside the challenges of maintaining product quality and ethical labor practices.

The cornerstone of this strategy's appeal lies in its capacity to significantly lower production costs. By situating factories in regions where labor and operational expenses are markedly less, businesses can enhance their competitive edge and profitability. A notable illustration of this is a leading electronics company that achieved considerable cost savings by moving production to Southeast Asia, thereby passing on lower prices to consumers without compromising on profit margins. Moreover, this approach allows for closer proximity to emerging markets, enabling firms to tailor their offerings more closely to local tastes and demands, thus driving up sales and market share in these regions.

However, this international approach to manufacturing is not without its pitfalls. The physical and managerial distance between a company's headquarters and its foreign factories can lead to lapses in quality control, as highlighted by the recall of unsafe toys by a well-known brand, due to oversight failures at its outsourced manufacturing units. Furthermore, the ethical dimension of this practice cannot be ignored. The pursuit of cost reduction has sometimes resulted in the exploitation of workers in less developed countries, casting a shadow over the corporate social responsibility profiles of several high-profile brands.

In conclusion, while relocating manufacturing operations abroad offers tangible economic advantages and the promise of market expansion, it necessitates a balanced approach to manage the inherent risks related to quality assurance and ethical labor practices.

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Model Essay 2

In the contemporary global economy, a growing number of companies opt to establish their manufacturing bases in countries distinct from their headquarters. This strategy, while instrumental in leveraging cost advantages and market proximity, is not devoid of its challenges. Principally, it offers economic benefits and enhances global market access, yet it raises concerns over quality control and potential exploitation of labor.

Foremost among the advantages is the substantial reduction in production costs. Countries with lower labor and operational costs enable companies to manufacture goods more economically, thereby significantly increasing profit margins. For example, a renowned tech giant relocating its production unit to a country with lower wage standards can remarkably decrease its manufacturing expenses, thus enhancing competitiveness. Furthermore, operating in diverse markets facilitates direct access to regional consumers, enhancing market penetration and responsiveness to local preferences, ultimately fostering a stronger global presence and brand loyalty.

Conversely, this global production strategy can compromise product quality, introducing complex challenges. The detachment between the company's management team and its overseas manufacturing facilities may lead to oversight failures, as was the case with a prominent automobile manufacturer that encountered recurring defects in cars produced in foreign plants, severely affecting brand integrity. Moreover, the ethical implications cannot be overlooked; the pursuit of lower production costs often leads to labor exploitation in developing countries, raising significant ethical concerns and potentially tarnishing the company's reputation, which could deter socially conscious consumers and impact long-term market position negatively.

In conclusion, while the decentralization of manufacturing operations presents clear economic benefits and opportunities for market expansion, it is accompanied by notable drawbacks concerning quality assurance and ethical practices.

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Model Essay 3

It is an increasing trend that companies manufacture the products in other countries instead of the head office. While this phenomenon will bring in the international specialization, it causes pollution for the relocated nations and harm the industries inside the home countries.

On the one side, the outsourcing of production in other countries could be beneficial to the multinational companies which could reduce the product cost. To be specific, some countries have a comparative advantage over others in producing a particular good or providing cloud-based services at lower opportunity costs. Taiyen Biotech Corp., for example, leverages the ample workers in labour intensive markets for mass production for the consumer commodity and stewards the whole operation in the head office. Therefore, the outsourcing manufacturing could effectively take advantages of the strengths of other nations.

On the other side, the outsourcing across the world allows the multinational conglomerates to seek the places where has the limited environmental protocols and policies. In other words, the developing countries without heighted scrutiny of environmental requirements are facing assorted pollution challenges due to the presence of factories from other nations. In addition, a plethora of enterprises flock to build up the third-country factories to cost down and in turn shut down the manufacture divisions. As a result, these actions lead to hollow out the local economy and worsen the high unemployment rates inside the developed countries. Thus, the pollution and competition are unavoidable threats during the process of outsourcing manufacturing.

To sum up, the firms can gain profits from manufacturing commodities internationally, however, there are potential risks related environment problems and hollowing-out industry.

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