1) The articles entitled “Globalization of Markets” and” “Pitfalls of Global Mar

Question

1) The articles entitled “Globalization of Markets” and” “Pitfalls of Global Marketing” reveal that one size does not fit all. It is evident that are tremendous advantages can be accorded to a firm by using a standardization strategy. However, those arguing for adaptation strategies may also be correct (10 pts).

What are the advantages and disadvantages of customizing products? Explain your answer in detail. (You may conduct additional research and use external sources of information to explain your answer, but be sure to cite all your)

Explanation / Answer

Here are some advantages and disadvantages of customizing products :

Advantages

• Customers are often more pleased with the finished product they receive, as it’s to their specification.
• Your workforce is more fulfilled as they now partake in numerous tasks as opposed to one production line responsibility.
• Customised products are more attractive to consumers than uniform products.
• Companies can forge strong relationships with their customers. That loyalty leads to return business time and again.
• As nothing is produced until an order is received, there are huge savings to be made by eradicating inventories of unsold goods and raw materials.

Disadvantages

• Maintaining a high level and variety of stock can incur high warehousing costs. Large amounts of capital are also tied up in stock.
• Typically, as the products are custom made they have a higher cost.
• Offering mass customization with mass production efficiency is very difficult to achieve.
• If you are coming from a mass production background it is extremely tough to change your organizational structure and culture.
• Substantial investment is needed in information technology to create close integration between all links to your organization’s value chain and external suppliers and intermediaries.

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