Globalization
Definition:
Globalization is the process by which businesses, ideas, and cultures spread across
the world, cheating interconnectedness and interdependence among nations.
Driven by advances in technology and communication, it leads to the blending and
exchange of resources, products and cultures.
Types:
Social
Technological
Financial
Economic
Political
Cultural
Ecological
Sociological
The world is becoming one large market rather than a series of separate national
markets. As a result, many businesses grew and evolved.
Indicators of globalization
● The same goods and services can be found in many countries around the
world
● Workers are finding it easier to move between countries and
capital(finance) is also moving more freely from country to country.
● Global trade and movement of products, people and capital is increasing.
How Globalization affects stakeholders
Advantages
➔Owners
,Opens new markets, increasing sales and profits, it also gives access to cheaper
materials and labour.
➔Employees
Workers can gain new skills, training and opportunities to work abroad.
➔Customers
More choice of products, often at lower price and better quality due to global
competition.
➔Suppliers
Can sell to international markets and grow their businesses.
➔Government
Gains tax from international trade and investment, leading to economic growth
➔Community
More jobs, investment and development in some areas.
Disadvantages
➔Owners
Increased competition allows to enter local markets, which can reduce profit and
market share for existing owners
Price pressure:Owners may have to lower prices cutting profit margins
➔Employees
Risk of job losses, when countries move production to cheaper countries.
Often face low wages and poor working conditions in developing nations.
➔Customers
Many experience loss of local culture as global brands demonstrate.
Quality concerns if goods are mass produced cheaply overseas.
➔Suppliers
Many face international suppliers competition, which can lower their sales of
profit
Price pressure they often need to lower prices, because global buyers demand it.
➔Government
Loss of control over economic policies due to foreign influence.
Tax avoidance many global companies move profits to low-tax countries, reducing
the government’s tax revenue.
, ➔Community and environment
Environmental damage from global transport and mass production
Cultural erosion as global trends replace local traditions.
Advantages
➔More trade and business growth: Companies can sell products worldwide,
increasing sale and profits
➔Job opportunities: Global companies create employment in developing
countries
➔Access to new markets and technology: Countries can share innovations,
knowledge , and skills
➔Cheaper products for consumers: Foods are often produced at lower costs,
making them more affordable.
➔Cultural exchange: People can experience new ideas, languages, and
lifestyles.
➔Improved international relationships: Countries become more connected
and cooperative.
Disadvantages
➔Job losses: Businesses may move production to cheaper countries, causing
unemployment in others.
➔Exploitation of workers: Some companies take advantage of cheap labour in
developing nations
➔Environmental damage: Increased production and transport cause pollution
and climate change
➔Loss of local culture:Global brands can replace traditional customs and
small businesses.
➔Economic inequality: Wealth often benefits large corporations and rich
countries more than poor ones.
➔Government control reduced: Multinational companies can influence local
laws and avoid taxes.
Definition:
Globalization is the process by which businesses, ideas, and cultures spread across
the world, cheating interconnectedness and interdependence among nations.
Driven by advances in technology and communication, it leads to the blending and
exchange of resources, products and cultures.
Types:
Social
Technological
Financial
Economic
Political
Cultural
Ecological
Sociological
The world is becoming one large market rather than a series of separate national
markets. As a result, many businesses grew and evolved.
Indicators of globalization
● The same goods and services can be found in many countries around the
world
● Workers are finding it easier to move between countries and
capital(finance) is also moving more freely from country to country.
● Global trade and movement of products, people and capital is increasing.
How Globalization affects stakeholders
Advantages
➔Owners
,Opens new markets, increasing sales and profits, it also gives access to cheaper
materials and labour.
➔Employees
Workers can gain new skills, training and opportunities to work abroad.
➔Customers
More choice of products, often at lower price and better quality due to global
competition.
➔Suppliers
Can sell to international markets and grow their businesses.
➔Government
Gains tax from international trade and investment, leading to economic growth
➔Community
More jobs, investment and development in some areas.
Disadvantages
➔Owners
Increased competition allows to enter local markets, which can reduce profit and
market share for existing owners
Price pressure:Owners may have to lower prices cutting profit margins
➔Employees
Risk of job losses, when countries move production to cheaper countries.
Often face low wages and poor working conditions in developing nations.
➔Customers
Many experience loss of local culture as global brands demonstrate.
Quality concerns if goods are mass produced cheaply overseas.
➔Suppliers
Many face international suppliers competition, which can lower their sales of
profit
Price pressure they often need to lower prices, because global buyers demand it.
➔Government
Loss of control over economic policies due to foreign influence.
Tax avoidance many global companies move profits to low-tax countries, reducing
the government’s tax revenue.
, ➔Community and environment
Environmental damage from global transport and mass production
Cultural erosion as global trends replace local traditions.
Advantages
➔More trade and business growth: Companies can sell products worldwide,
increasing sale and profits
➔Job opportunities: Global companies create employment in developing
countries
➔Access to new markets and technology: Countries can share innovations,
knowledge , and skills
➔Cheaper products for consumers: Foods are often produced at lower costs,
making them more affordable.
➔Cultural exchange: People can experience new ideas, languages, and
lifestyles.
➔Improved international relationships: Countries become more connected
and cooperative.
Disadvantages
➔Job losses: Businesses may move production to cheaper countries, causing
unemployment in others.
➔Exploitation of workers: Some companies take advantage of cheap labour in
developing nations
➔Environmental damage: Increased production and transport cause pollution
and climate change
➔Loss of local culture:Global brands can replace traditional customs and
small businesses.
➔Economic inequality: Wealth often benefits large corporations and rich
countries more than poor ones.
➔Government control reduced: Multinational companies can influence local
laws and avoid taxes.
