Contemporary Issues in International Business
Question 1: Why were sewing machines one of the world's first "global products?"
Globalization has gained extreme importance these last years. At an economical level, globalization is understood as the increased movement of goods and money across national borders, which led to the rise of the global economy. International trade has become the center of attention to most of local economies around the world. In the 19th century, the sewing machines that were manufactured by Singer and Company manufactured were considered among the first global products. This was attributed to the increased expansion of its markets beyond the geographical boundaries. During the early 1850's, the company's operations were seen expanding to different parts of Europe.
It experienced freedom of capital acquisition and exchange of goods in the countries in which the Singer Sewing machine was accessible. In an attempt to realize its globalization, the Singer machine was able to incorporate the various legal regulations that characterize a given geographical region. Accordingly, in the job market, employees worldwide and the consumers were able to compete in order to either acquire the chance to work with the Singer Sewing Machine company or acquire its products.
The economic fate of the global workers is not only tied to the national economies but can also work abroad for the company to realize its strategic objective. The sewing machines success did not depend entirely on the success of an individual country's success but incorporated the global economies, therefore, the income distribution and wages of its employees is stable. Upon incorporation into the global market, the company was able to improve the sewing machines productivity and in turn increase its competitive nature globally.
Question 2: How was Singer able to capture 90% of the world market for sewing machines?
Singer was able to increase its market share in the economy with the help of Clark's innovation. After the decline in growth in the sales of sewing machine in the economy and increased lawsuits subjected to the company by manufacturers and competing investors, Cark resolved to focus not only on gaining market share but also on the ways of increasing the company's capital outlay to enhance expansion globally. The company's marketing strategy that was deployed was the opening of branch offices in the various regions including New York, Boston, and Philadelphia in an attempt to attract new customers. In addition, there was enactment of Albany Agreement where the incorporated both the domestic and international consumer demands. In the case of domestic demands, the company introduced the hire-purchase plan with its focus being on attracting the majority of the consumers who are not able to afford the cash basis payments.
Globally, the company hired independent agents in an attempt to sale its products to the foreigners. Singer achieved its biggest boost in 1867 when it was able to easily circumvent the adversity of the freight charges that, earlier on, impeded its success. This achievement was after the George Woodruff was moved from Boston sales offices to the British Empire in an attempt to revamp is market share. Ideally, the company was able to establish a sewing machinery factory, which was considered the largest, in the parts of U.S, U.K., and Europe. It ensured that the initial cost of wastage that was experienced by the company when shipping its products to these destinations was minimized. As such, the consumers were able to rely on their products that were now in good shape, increasing its global market share in the glob al economy. In addition to this initiative, the company also pioneered the modern sales organizations in an attempt to reach potential consumers through the use of canvassers or door-to-door salesmen.
Question 3: What was the most important factor behind Singer's success in the Russian market?
The important factor that spearheaded the success of the sewing machine in the Russian market was the administrative discipline and the imminent need to access the company's resources with ease. Such an aspect was facilitated by motivation that Flohr gave to his sales team in Russia. The Russian economy was characterized by political and social structures that were unique to other Western Europe countries. It had not fully join the industrial revolution, therefore, its legal system, capital markets and the credit institutions were considered underdeveloped. Flohr ensured that the agents focused more on collections rather than sales as unlike in Europe, the Russia economy was characterized by high collection commissions.
The Russians buyers were able to pay few rubles at the point of sales; therefore, enabling them to pay the amount in installments would facilitate the sales level of the company. In addition, repossession of the Singers was the last resort that the company undertook. This ensured that the customers were attracted to the company's arrangement of down payment and the customers were able to be treated with utmost gentleness.
The elimination of the traditional singer categories by Flohr in the Russian economy, such as the bad and good accounts, ensured the agents were motivated to salvage the relevant accounts ad minimize any paperwork that would have been associated with closing of the accounts. The management team and staff that were undertaking the operations in Russia were highly qualified and with relevant skills to handle the challenges that may sprout form economic and political instability of Russia. All these initiatives saw an increase in the sales outlay and the overall success in the Russian economy.
Question 4: How would you compare the globalization of sewing machine in the 19th century with that of computers in the late 20th and early 21st centuries?
In the early 20th century, the invention of abacus computers was perceived that will be felt only locally and within the region of its invention. Like the early period of sewing machine manufacturing, the usage of computers was able to be felt globally as there were increased operations and the attempt for companies to comply with increased technological advancement. In order to be competitive in the current economy, the company needs to produce high quality and also high quantity products.
This will only be achieved with the use of faster and more reliable technology; computers. Sewing machine was first introduce to the economy when there was need for durable and faster production of clothing and other ornaments, the same case with computers. The bulkiness of the operations in the business sector with limited time available to manually incorporate all the data in the paper work instigated for the need for computers in the system. Currently all business operations, globally, relies on the use of computers in their system in an attempt to acquire large market share for their products as it will enhance their competitive advantage in the economy.