Though skeptics might disagree, globalization has had a positive effect on the manufacturing industry. As we discussed in one of our earlier blogs, there are a few challenges that the manufacturing sector is currently facing. In fact, some of these challenges may have been brought forth by globalization. However, ironically, it’s globalization that’s helping them solve these challenges.
Let’s see how.
Free Trade Agreements
Free trade agreements are the result of globalization. Thanks to them, the access to the global market is open and equal. All countries that sign these agreements benefit greatly. This is because they are able to establish economic opportunities for the manufacturing sector.
For instance, let’s look at the CHAFTA legislation between Australia and China. China now has open access to the agricultural products and important raw materials that Australia is known to offer. In exchange, Australia receives the best of machinery, clothing, and electronics from the Asian economic giant.
Of course, not all trade partnerships are perfect. For instance, trade deals that are linked to greater economic and political goals end up putting too much pressure on the manufacturers. So, when you have problems such as currency fluctuations, which are not under the manufacturer’s control, things can go very bad.
However, manufacturers can still compete by adhering to a few key strategies.
This includes offering:
- High-quality products
- Ensuring low overhead costs
- Maintaining delivery reliability
By doing so, manufacturers can gain stability in the long-term, even with challenges.
Environmental Protection Agreements
Like free trade agreements, organizations across the globe have signed treaties promising to address environmental challenges.
Some of the environmental challenges are:
- Resource Depletion
- Climate Change
Though it is a challenge of epic proportions, global organizations are still facing it with a wide range of solutions and strategies.
For example, manufacturers are adopting the latest machinery to increase production efficiency. They are also moving to improvise production processes to eliminate repetitive tasks and decrease waste creation.
There are several such solutions being utilized to ensure compliance with these environmental treaties.
The Benefits are Endless
These are just a couple of examples proving the positive impact of globalization on the manufacturing industry. Globalization continues to push manufacturers towards improving their methods and focus on innovation.
As global trade grows, manufacturers will be forced to adapt in order to stay in business.
In such a competitive scenario, how can translation aid and benefit banking and financial firms to stay relevant in a globalised business landscape?