Globalization STEPHEN MCKINNEY / JON LIVOLSI / BRENDON SOUSA / SAMUEL

MCDONALDGARRICK PENHA / WESLEY THOMAS

Table of Contents Table Of Contents

Quote What is Globalization?

Video Effects of Globalization

Reason for the Rise in Globalization Examples of Globalizations

Closing

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”“Globalization is not something we can hold off or turn off…. it is

the economic equivalent of a force of nature-like wind or

water.”-Bill Clinton

What is Globalization?

Is a movement toward a more interconnected and interdependent world economy.

Effects of Globalization

STEPHEN MCKINNEY / JON LIVOLSI

Effects of Globalizations• Effects on U.S. Economy

• U.S. has largest economy• What it does affects the Worlds economy• What happens in the World economy affects U.S.

• Effects on the World• India and China have large growing Economies• This makes the demand for energy go up• And is the reason for rising oil prices

Globalization of Markets Globalization offers new opportunities for companies

By expanding worldwide a companies consumer base expands as well

2013: 21 million cars bought in China, only 15 million bought in U.S.

You have to adjust the product to suit the unique taste of the local market

Coca-Cola adjust its recipe to appeal to people around the world

Globalization and Production

Outsourcing- assignment of certain tasks, such as production or accounting, to an outside company or organization

Offshore outsourcing- involves moving production form domestic site to foreign location

Many companies have moved production to china because it is cheaper and profit is increased.

Reasons for the Rise In Globalization

Dramatic Decline In Trade and Investment Barriers

● Government restrictions that prevent the flow of goods, services, and financial capital across countries.

● Prevent the flow of goods, services, and financial capital across countries

● Lowering barriers make global business cheaper and easier to conduct.

● Lower barriers also allows a firm to move it’s different production activities to the lowest cost locations.

Technological Innovations Advances in technology, communications, and transportation

have made it easier to better manage global production and marketing of products

With the help of internet conferencing tools, a business man can meet with contacts without having to physically be there.

This has greatly reduced the cost of doing business.

Benefit small businesses more so, in a sense that they can inexpensively access customers worldwide

Global Business Trends

Due to the rise of Globalization, specific trends have been developed to help increase it’s use on a global scale

These Trends consist of: A Growing Role for Developing Nations Rise in Non-U.S. Foreign Direct Investment Rise in Multinational Enterprises Increasing Democratization

A Growing Role for Developing Nations Countries around the world, such as China, India, and Brazil have

expanded at fast pace and other countries are following in their footsteps

This trend is not only expected to last for a long time but assists countries on increasing their presence on a global scale

Rise in Multinational Enterprises

Globalization has led to a rise in the importance of multinational enterprises

Businesses that provide products to multiple countries have become making scene on the world stage

Companies such as Transferwise have used technology to be able to expand its business abroad at a rapid pace

Rise in Non-U.S. Foreign Direct Investment

The U.S. was originally number one in the investments and purchases of companies in foreign nations

Now countries are starting to invest in foreign companies across the world

This causes an increase in foreign direct investment in not only the U.S. but also in developing nations

Increasing Democratization

The increase of democratization and adoption of free market economies has been leading more and more countries to get involved with the global economy

If the trend continues, there will be vast opportunities for international business due to the expansion of the global market and as more locations become production sites

Examples of Globalization

SAMUEL MCDONALDWESLEY THOMAS

The Globalization of Coca-Cola

• Founded in 1880 by John Pemberton and was moving towards Globalization by the early 1900’s

• Asa Griggs Candler became majority shareholder in 1888 and quickly started moving towards expansion.

• Operates in over 200 countries• 70% of Income is created outside

the U.S.

The recipe for success was created early on.

A System that Works

Coca-Cola as a consistent product Brand trust Easily recognized logo Personalization to specific countries Maintained consistent price The Coca-Cola System of franchising was

born This model continues today

Coca-Cola Strived early on for brand recognition

Production Globalization

Expansion to Cuba and Panama Plants opened near areas of demand Plants opened to curb shipping costs Cheaper to bottle the product on site than to ship in The franchise model continued 275 smaller companies bottling and distributing Coca-Cola Easy expansion with smaller up front costs Flexible packaging Technological advances in cheaper transportation

Expansion in Todays Market

The continued success of the Coca Cola brand while remaining true to its core Changes to suit individual markets

Addition of PowerAde for the sports market Diet Coke, Vitamin Water, Odwalla products for markets

focused on health Flavored products such as Vanilla and Cherry Coke to combat

other brands

McDonald’s McDonalds was founded in California in 1948 By 1963, they had about 500 restaurants nationwide, and sold well

over 100 million burgers In 1967, McDonalds went international opening their first restaurants

in Canada and Puerto Rico Since, McDonalds now operates in 119 different countries.

(McDonalds first location)

International MenusCountry Product Description

Germany Nurnburger Bratwurst on a soft roll with mustard

Philippines McSpaghetti Spaghetti topped with hotdogs and served with a piece of fried chicken

Japan Ebi Filet-o Burger patty made of shrimp, on sesame bun

Mexico McMolletes A McMuffin with refried beans, cheese, and pico de gallo

Israel McFalafel A Kosher falafel with chickpea fritters and assorted vegetables

MCDONALDS MENU ALTERATIONS In countries such as India,

McDonalds alters the entire menu to better fit their the cultures

Buddhism is a major religion in India Many Buddhists are vegetarian

and as a result, Indian McDonalds have many vegetarian options

Curry is a Major seasoning used in the Indian culture McDonalds use it in many of the

dishes

Sources

VIRTUAL SOURCES http://www.globalization101.org/what-is-globalization/ http://www.forbes.com/sites/mikecollins/2015/05/06/the-pros-and-cons-of-glob

alization/ http://

www.chicagotribune.com/business/ct-biz-mcdonalds-food-around-the-world-photogallery.html

http://www.aboutmcdonalds.com/content/mcd/our_company/mcdonalds-history.html

BOOKS Martin,K., Poasty, M., & Solomon, M. (2016). Better Business (4th ed.). Boston,

Massachusetts: Pearson Education