Skip to content

Outsourcing Improves Global Commerce

The idea behind outsourcing is that companies should do the work they do best. It can be, for example, a small business consultant who sets up shop by outsourcing part of their operations to others with more advanced skills.

For example, Henry Ford was at first reluctant to outsource, and kept his operation small. Rather than outsourcing rubber production for tires he preferred to try to grow their own trees in the tropics.

Even though that idea failed, his business became what it is today when he built cars and left tires to Goodyear. The same rationale was applied to car parts, engines, headlights, etc. They are more economically bought from the companies whose business it is to produce them.

No company can stand on its own. Companies that produce the same items will compete with each other, but companies that produce complementary goods will inevitably cooperate and trade with each other. Why not help the complementary company, while helping one’s own business?

At first this kind of outsourcing was mainly within countries and then grew into an international affair. At first, international trade consisted of imports and exports of raw materials needed for manufacturing and buying from other countries what cannot be produced at home.

Now the global economy rises and falls with the interaction between companies. The system of interdependence benefited all the players until conditions in the early 2000s made trading and outsourcing temporarily more difficult.

The world is getting smaller because the internet connects interests and job opportunities all over the globe. Our interests become their interests and their interest becomes ours. No longer can any one country dictate to and mistreat their own people without everyone the world over knowing about it almost instantly. That is good. Potentially it will have the effect of creating better business ventures and healthier commerce around the world.

Encorpus provides small business consulting and strategies for business startups, product launches, or business development. Encorpus customizes and personalizes every strategy, advisory session or business relationship to you and your company’s special DNA.

Posted in Uncategorized.

0 Responses

Stay in touch with the conversation, subscribe to the RSS feed for comments on this post.

You must be logged in to post a comment.