Impact of Globalization Essay

It has gradu all toldy evolved from the 1970s after the coming of different forms of high speed transportation and communication to the age of entropy technologies around the millennium, to make a single unified community where all the major sources of various social conflicts have disappeargond (Scheuerman, 2010 and World Regional Geography, 2009). thither are several ways of defining globalisation. As defined by Dr. Nayef R. F. Al-Rodhan (2006), Globalization is a process that encompasses the ca designs, course, and consequences of transnational and transcultural integration of compassionate and non-human activities.The effects of Globalization are manifold. It influences industrial sector, financial sector, labour markets and consumers of a grumpy realm. On one hand it gives rise to more jobs and industries, however, on the opposite hand, countries are becoming dependant on the other country for a specific product/raw material. Additionally, because of outsourcing jobs fr om certain economy are being transferred to the developing economy, which has a negative effect on the developed economy and positive on the developing economy. 2. 2 Consumer Packaged Goods and GlobalizationConsumer Packaged Goods (CPG) are sold at relatively low set and are non durable goods like grocery items, soft drinks etc. fully grown CPG manufacturer has an advantage of strong brands, greater geographical coverage and having major retailers. CPG industry is affected by the change in fashion, fads and consumer preferences, which in bite effects the purchasing decision of a consumer. Therefore, I believe that in the fast and ever changing world of Consumer Packaged Goods (CPG) it is imperative to talk over the effects of globalization on this industry.Additionally, there is immense pressure and eager competition between the manufacturers globally to fulfill the demand of consumers. 2. 0 clash of Globalization on CPG Industry 3. 3 Costs and Benefits of Globalization on CP G Industry There are diverse ways in which globalization impinge on CPG industry. Some are beneficial for the industry and both(prenominal) arent. The good side of globalization is explained as follows a. Profits from emerging markets Procter and attempt in year 2006, showed a total sales of US $ 68 billion, out of which US $ 21 billion was from emerging markets.Additionally, from 1992 to 2006, globalization has boosted the American economy by US $ one trillion in crude(a) Domestic Product (Veiders, 9th July 2007, Supermarket news). b. Consumers advantage The consumer gets the advantage of choosing from wide assortment of goods, in addition to the comparative advantage. Additionally, the offshore markets are producing goods at a price which is lower than the domestic production of a particular country. though this is an advantage to the consumer, this could hamper production and associated profits in some countries (Oline Thompson, 2006, CPG Manufacturing) c. remote capital acce ss Foreign capital access is the main brainish force of globalization. This in turn join ons the investment power of a particular country to produce better produce economically (13th February, 1996, WTO News (press releases). The other side of globalization illustrates some problems faced by CPG Industry a. ethnic disparity A product that might be a requirement in one country might not be change surface known or used in the other, which would have a negative effect on the CPG industry while trying to encourage its use in a particular country.To cite a salient example, Brazilians usually dont have breakfast, because they sleep late at darkness and consumers in China for breakfast eat hot, soft and savoury, while the jointure Americans love cold, crunchy and sweet breakfast. This was the difference analyzed by Kellogg Company in 2007 (Veiders, 9th July 2007, Supermarket news). b. Global Competition In this fast paced environment any CPG troupe have to constantly innovate and d ifferentiate their product, to maintain or increase their market share. Every year large number of new products are being roduced and capture the shelve space of the existing labels and compete with them.