GMS 200 Lecture Notes - Lecture 3: Global Sourcing, Comparative Advantage, Opportunity Cost

• School: Ryerson University
• Department: Global Management Studies
• Course: GMS 200
• Professor: Omid Jadidi

Document Summary

Comparative advantage occurs when one country can produce a good/service at a lower opportunity cost than another. Only one country can survive on its own, even if all countries die /fail: usa. The practice of sourcing form the global market for good/services across geopolitical boundaries. Global sourcing often aims to exploit global efficiencies in the delivery of a product or service. These efficiencies include low cost skilled labour, low cost raw material and other economic factors like tax breaks and low trade tariffs. China: small packages, commercials, kids introducing the tradition into the family/parents, less sweet. Venezuela: kiosks, outdoor ads because they"re on the go, milk chocolate cookie instead of regular. Profits; global operations offer greater profit potential. Customers; global operations offer new markets to sell products. Suppliers; global operations offer access to needed products/services. Capital; global operations offer access to financial resources. Labour; global operations offer to lower labour costs.