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A mobile phone manufacturer decides to globally source inputs that they had previously produced themselves - HSC - SSCE Business Studies - Question 11 - 2021 - Paper 1
Question 11
A mobile phone manufacturer decides to globally source inputs that they had previously produced themselves. Which of the following shows possible negative effects o... show full transcript
Worked Solution & Example Answer:A mobile phone manufacturer decides to globally source inputs that they had previously produced themselves - HSC - SSCE Business Studies - Question 11 - 2021 - Paper 1
Step 1
Delays in the supply chain and increased transport costs
Answer
The decision to globally source inputs can lead to potential delays in the supply chain as managing suppliers in various locations often introduces unpredictability in shipping times and communication. Furthermore, increased transport costs may arise due to longer distances and reliance on international shipping, which can be more expensive than domestic production.