Why is everything made in China Research Paper Example | Topics and Well Written Essays - 4000 words

Why is everything made in China - Research Paper Example China is an industrialized nation and has the support from various aspects such as government for survival in the industry. The trading relationships with other countries are also excellent such as the US traders prefer to have Chinese suppliers because the bulk shipping order’s cost is less which means import from China is cheap compared to other countries. According to the study performed by Booz Allen Hamilton, only those companies are successful that integrate China as the basis of competitive advantage. The improvement in the economy shows that China has a great potential for future domestic sales, therefore setting up factories will facilitate to be a beneficial project for the future. The major domestic industry in China is automobile, which may change in the future (Booz Allen Hamilton Inc, â€Å"Booz Allen/AMCHAM Shanghai Study Finds Companies Adopting China as Both a Growth Market and Manufacturing Hub Are Two-Thirds More Profitable Than Others†). There are ce rtain controversial views such as China is not good in social responsibilities because they make the children work for cost minimization. Hence, the myth is that a company in China is only concerned about the profit and not the society. They do not consider all the 3 P’s that are Profit, People and Planet (Whycenter, â€Å"Why Is Everything Made In China†). ‘Made in China’ products are becoming more famous in today’s world. In this research paper, the benefits of manufacturing units in China have been analyzed with an example of plastic manufacturing unit. The effect of the economy and environment are examined to understand the reason for building manufacturing units in China. The integration of all economy implies globalization, hence the increase of ‘Made in China’ products are affecting the world’s economy. The economy of China and other countries have been analyzed to understand the impact in other countries. Every company fo cuses on cost minimization to increase the profit margin. The labor cost in China is a factor to be taken into consideration for the labor intensive companies such as clothing, footwear and others. In order to reduce cost of production, companies generally look to shift to China for establishing manufacturing units. There is a potential growth in China but the question arises whether it is sustainable or not. In this context, the future prospects in China are identified. Benefits and Reasons for Manufacturing in China China has emerged as preferred destination for setting up of manufacturing units due to certain advantages that are present in the country. The labor cost is less in India and Africa. However, to build a plant in developing country a few infrastructure facilities such as electricity, technology, telecommunication, financial infrastructure, government cooperation and others are essential to be considered. In this case, China is advanced than India and it is incomparable with Africa. Hence, China provides the advantage of cheap labor and adequate industrial infrastructures. China is perceived as the huge potential market thus it encourages the potential to build the operations in the country. Certain examples of reasons as well as benefits of manufacturing in China are: Reduction in cost of Direct Labor, Overhead and Material Cost Indirect Engineering, Marketing, Financial Labor & Transactional Cost is reduce. Supply chain logistics & service are made simpler to Asia’s customers Center for Material Sourcing throughout Asia for Domestic and China Production