Define globalisation.
The increased interconnectedness and interdependence between countries, economically, socially, culturally and politically.
What is a TNC?
Trans-national corporation, large companies located globally, can be called the drivers of globalisation. Eg. Nike
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Define globalisation.
The increased interconnectedness and interdependence between countries, economically, socially, culturally and politically.
What is a TNC?
Trans-national corporation, large companies located globally, can be called the drivers of globalisation. Eg. Nike
What is offshoring?
Companies moving their processes to locations overseas.
What is onshoring?
Companies contracting existing companies in a country to do their processes.
Why may companies offshore or outsource?
Cheaper labor costs, access to more markets/
Where are the majority of US imports from?
South-East Asian countries such as China and Vietnam
What is the largest source of clothing and how much were the clothing imports?
China, 29.6 billion dollars worth of clothing imports in 2014.
Name an example of cultural globalisation.
McDonalds, an American fast food chain which spread into many countries, diffusion of culture through food.
How does the development of planes increase globalisation?
Development of planes can help the ease of travel across countries. Quicker travel for tourism and migration allowing the spread of culture. Additionally it's easier for business people to make deals in other countries. This is economic globalisation.
How has the development of container ships increased globalisation?
Ships represent complex international trading. Cargo ships ship goods efficiently and cheaply, leading to a more widespread spread of economic goods. Political ties of trade agreements reinforce globalisation politically.
How does the development of the internet increase globalisation?
Internet helps international communications between companies, additionally ease of online shopping, someone in the US could be shopping on a German website and have it delivered to them. Emailing also eases communications between businessmen.
How do TNC's increase globalisation?
By expanding to other countries they force these countries to be more interconnected through trade, business, communications and spread of culture.
3 stats on containerisation.
- $4Tn worth of products transported today
- Moves 95% of the worlds goods around.
- Average cost of a TV to ship to the USA from China is $2
Why is containerisation used so widely?
As they just load the containers onto tracks and trains without repackaging it is cheaper. Additionally, the transport costs are reduced by at least 75% due to more competitive pricing when competing with cheaper countries and economies of scale, larger amount of items smaller the travel cost.
Wat is the order in which a clothing product is produced and give an example of where it could be in.
1. Raw materials are ordered and sent to the country. Uzbekistan
2. Parts are cut, dyed and sent to another country. China
3. Final product is assembled, stitched and packaged. Bangladesh
4. The product is shipped to the country of sale and sold in high street stores. UK
5. The company conducts market research and advertises to improve its brand image. India
6. Product is redesigned and tested at headquarters. USA
What is the fortune500?
Top 500 global companies.
What is the trend in the Fortune 500 over the last 20 years?
In the last 20 years fortune 500 companies have become less western, moving towards asian countries like China.
Explain how TNC's can cause globalisation?
Trans national corporations spread connections around the world outsourcing to other countries further strengthening their bonds. This is where companies such as Apple contract existing companies in other countries to help with their processes/. This drives globalisation by having 2 countries benefiting from each other spreading products culturally and politically creating stable bonds.
When did Kraft take over Cadbury?
2010
How much did Kraft pay to takeover Cadbury?
$18 billion
When was Cadbury founded and by who?
1879, John Cadbury
What are Quakers and how do they link to the takeover?
They are a Christian religious group influencing the Cadbury family and their business, particularly their ethical approach to managing the company and emphasis on worker wellbeing. However with the takeover of Cadbury, it would become a large TNC craving for money, the business ethics and famous traditions would be ruined and the Quaker heritage gone.
What are mergers and acquisitions?
When 2 companies join together to increase profits.
What is the product portfolio?
Range of products produced by a company.
Name some strengths of the Kraft acquisition of Cadbury.
Higher profits
Research and development facilities in Bournville as a new production line.
Addition of the chocolate inventor jobs.
25 to 250 jobs in Bournville research
Name some opportunities of the Kraft acquisition of Cadbury.
Reduced costs of production after moving production lines to Poland
Different collaborations with other Mondelez companies.
Name some threats of the Kraft acquisition of Cadbury.
Protests around the UK, tarnishing the brand name in controversy
Legal cases against Kraft
Possibly more factories to be shut down
Potential decline of local employment opportunity after ruining the Quaker heritage.
Name some weaknesses to the Kraft acquisition of Cadbury
Change in taste of chocolate
Sommerdale factory had 400 jobs cut and eventually closed even after Kraft promised to keep jobs.
Bournville bar made in Poland
0 hour contract, no guarantee of amount of work.
Greenwashing - pretending they are more sustainable than they really are
What is cocoa life?
It's mondelez's version of fairtrade aimed as an international sustainability program to ensure that their cocoa is "made right"
What does Mondelez aim to do with cocoa life?
Mondelez aims to use cocoa sourced from cocoa life in all its brands by 2025.
What issues does cocoa life tackle?
Tackles cocoa farmer challenges such as gender equality, climate change and poverty
How has cocoa life improved communities?
In Ghana for example, Cocoa life have gave solar powered lights for a cheap and stable light source so they can continue working and studying during night time. Additionally they were given hybrid seedlings which grow quicker thus there will be a bigger harvest and the farmers can earn more.
What is greenwashing?
The act of making false statements about the environmental benefits of a product.
What is fairtrade?
It's a movement ensuring safe and healthy working conditions for farmers, it also supports sustainable farming methods.
How does fair trade benefit farmers?
Small scale producers of goods can group together into cooperatives and deal directly with the retailers, the retailers pay slightly more meaning growers receive more from their products.
What percentage of the money goes to the 6 main jobs when coffee is sold by fairtrade?
UK - Retailers 32%
UK - Processors 38%
UK - Shippers 5%
Kenya - Exporters 8%
Kenya - Traders 10%
Kenya - Growers 7%
What percentage of money goes to Kenyans and people from the UK when coffee is sold by fairtrade, what does this show?
Kenyans earn 25% whilst people of the UK earn 75%. This shows us that even with fairtrade, developed countries profit much more compared to emerging countries, uneven relationship.
What are 4 benefits of fairtrade?
Fairtrade premium - can vote on what to use money on as a cooperative
Promoting sustainable practices so the environment can be protected
Teaching farmers with workshops how to make homemade fertilisers eg.
Food security - certainty that you'll receive enough food