Globalization Effects on Businesses

Almost every aspect of the economy is impacted bymore money, the increase in oil and gas prices also
globalization. Many people don't realize how much ofhas an unseen effect on all businesses. The increase
an affect globalization has because they ignore thein oil and gas prices is something that affects us all.
big picture. Globalization is thought of as outsourcingAs much as we all complain about the increase in
and has many different functions, such asthese prices, it is something that we cannot solve
communication between countries, news, cheaperand for which we will continue to pay higher prices. I
labor and free trade. Globalization has an effect onwould consider gas and oil a necessity for all, not only
every economy, ultimately changes world views, andfor one's own personal use, but everything used and
heavily influences what we do. A large aspect andneeded in our economy is brought to us with the
concern of every economy is the many globalneed of oil and gas. This ultimately increases our
influences that affect business. There is a growingcosts, as well because we now need to pay more
belief that outsourcing will aid our economy whilefor the transportation costs of receiving the goods
enduring many global speed bumps. Some globaland services needed to run business. Customers are
changes that affect business are the price ofalso disturbed by this global issue because they could
imports, exchange rates, increase in oil and gaspossibly no longer have the means required to pay
prices, and recession. Is outsourcing a way of solvingfor some businesses. In return these customers will
cost issues?choose cheaper alternatives. This specific global trend
To begin, a substantial global trend relates tohas nothing to do with the U.S. because we do not
commodity fluctuation. As the price of imports rise,produce the oil or gas, but as citizens in this
we are able to buy fewer goods. This affectseconomy, we are very much affected.
countless businesses throughout our economySimilar to the effect that the extra costs incurred,
because they may then have to take on otherthe recession alters every business in the economy.
measures to obtain necessities needed to run aThis slow down of economic activity is taking a
business. Accommodation, due to the lack ofmajor impact on every household, business and
availability, generally leads to increased cost and alterseconomy. With the recession, big changes need to
the way of business. Paying more for any productsbe made in order to be secure in these down
or services needed to run a business will lead to aneconomic times. This issue fundamentally affects
unfavorable issue of increasing prices; thereforeevery business in the economy as a whole; as
ultimately driving away some of the usual clientele.commerce decreases due to changes needed in this
The increasing troubles and costs of confined sourcesfluctuating economy. Due to all the foreseen extra
negatively affect businesses daily operations. Ascosts, many businesses may have to begin
businesses are losing funds in some areas,outsourcing to keep the company functioning in this
outsourcing can make up for incremental loses.difficult economy. As outsourcing is becoming a rising
Outsourcing is commonly known as sending work toissue, there are many benefits and misfortunes
an outside provider in order to cut costs.related to the act. Outsourcing is looked upon as a
Another global trend that has similar effects as theway to save money, mainly due to lower labor costs.
price of imports is the issue of exchange rates. If theIt is also viewed as a way of expanding recognition
value of the U.S. dollar drops it would lead toand competitiveness, but many believe that
negative circumstances; as we would then pay moreoutsourcing is negative because it takes away from
for the goods needed. Once again, paying more forthe American economy.
the goods needed would affect both businessIn conclusion, the continuous global trends are
owners and customers. Not only would we have tounseeingly affecting all businesses throughout this
pay more for the goods needed, but we may haveeconomy. These global trends cause a constant need
to take other measures like eliminating or changing ato accommodate, which is applying more costs and
business's products and services. This elimination orfrustration to all businesses. The global affects that
change could either benefit or hurt overall business. Apeople are unaware of are what is slowly bringing
business could rid the hassle and extra costs ofdown businesses in this economy. Along with tending
importing goods from other countries, but thisto the extra costs incurred from globalization,
change may lead to unsatisfied customers whichbusinesses still have to focus on fulfilling customers
would subsequently hurt business. This change mayexpectations in order to improve satisfaction and
lead to poor company reputation, while outsourcingincrease future business. Outsourcing opens doors for
may not be the best resolution. Outsourcing doesn'tmany businesses to gain access in a foreign market,
always improve a company's reputation and canbut not all businesses can handle and maintain activity
weaken a business's initial ability.in these roughing economies.
In addition to the global trends that cost the business