ECO 211 Chapter Notes - Chapter 23: American Furniture Warehouse, Global Sourcing, Collegehumor

• School: University of Miami
• Department: Economics
• Course: ECO 211
• Professor: Lorca Maria

Document Summary

Case #23: american furniture warehouse sources globally: factories in many developing nations have lower cost structures, but that is often attributes to fewer benefits and lower wages for workers. The ethical tradeoffs for the retailers is that they are knowingly outsourcing their products to countries where wages and working conditions are below standards provided in the states. However, to many companies, lower production costs are more important than these ethical tradeoffs. Shoppers do not really care about where their products are being made and the conditions that those workers and in, mostly because they are unaware or ignorant about these facts. When purchases an item, most shoppers look for the best deal and lowest price and don"t pay attention to where it was made. If they do, however, they tend to not care as much: the world is our marketplace. Afw employs global sourcing, uses many negotiating tactics and shifts channel tasks to keep is costs as low as possible.