Whether you agree with the globalization of the logistics industry or are opposed to it for whatever reason, one thing is certain; there has been a larger than normal push for it in the past few years.
So we figured what better time to bring this topic up once again than when efforts to increase globalization are really at their peak?
In this article, we will be discussing what globalization is and what benefit it holds for companies who are jumping on the bandwagon of recent efforts to promote the expansion of globalization.
What is Globalization?
Ask 10 people what globalization means to them and I can assure you that you will get a few different answers. Some will sing of its praise in connecting and bolstering poorer communities, while others will tell you that it leads to more big bad capitalist agendas.
So, what is globalization?
In its simplest form, globalization is simply the act of expanding one sector of a business or even an entire industry into the global market. The reason for doing this, however, is multi-faceted and it varies from company to company. Some are looking to save money, some are looking to build up their name, and others still are approaching it with a more humanist agenda.
Either way, globalization is not a new concept to business in any stretch of the imagination. Since ancient times, people have traveled across the globe trading all sorts of commodities such as spices, herbs, and currency. They would use geographical arbitrage to acquire various goods at a price that was much cheaper than they could find the same product at home. Then they would travel back to their home country to sell their goods at local prices and make a sizeable profit for their time.
In social terms, globalization provides a larger interconnectedness among several global populations. Culturally speaking, it represents the exchange of values, ideas, and the development of single world culture. And politically, globalization efforts have shifted political activities, and policies in many countries, and has certainly altered how international laws are created and enforced.
Wider Sourcing Options
One of the biggest advantages of a more globalized industry is diverse sourcing options.
As the industry begins to stretch across the globe, all kinds of new business opportunities arise. It offers an opportunity to secure workers, products and building materials from a much larger and diverse circle of connections.
New Customers in Untapped Markets
The second biggest benefit of globalization comes in the form of new customers in potentially untapped markets. More money also generally means the ability to expand the supply chain even further.
Along with these new customers also comes new demands. This has the potential of creating new business models based around new global needs.
Direct Impact on Company Growth
Due to the consistent emergence of new technologies, the logistics industry is growing at an unprecedented rate. And with this growth, we are beginning to see that our new technologies are aiming to make it so much easier to facilitate large supply chains around the world.
By utilizing emerging technologies to facilitate global expansion, growth of the supply chain is simply an inevitable by-product.
Lastly, but certainly not least, is the money-saving benefits presented by globalization.
Materials, workers, and even transportation can be sourced and acquired for much less in other areas of the world. In fact, it would behoove all companies to consider the inherent benefit in that.
By expanding globally, companies can take advantage of the market by putting some very rudimentary arbitrage-minded tactics in play.
The logistics industry is not new to the idea of globalization. As a matter of fact, the logistics industry as a whole encounters globalization efforts more than any other industry.
By leveraging the inherent benefits of globalization, companies can achieve financial success. Furthermore, they can also build up their global authority in their respective industry and continue to scale. And all of this while saving money on materials, labor, and in numerous other ways.
So, with globalization efforts on the rise, how will you expand your global reach this year?