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Chapter 6: Globalization in the Fashion Industry - Coggle Diagram
Chapter 6: Globalization in the Fashion Industry
Globalization & fashion
Reasons going global
saturation of the target market
extending their operations overseas provides them with great opportunities for rapid development & growth
demand for brands with a global outlook as they have international consumers
globalization of customer
consumer are now changing their shopping habit to online because it is easy so customers can purchase product from the other country
Eg: Amazon
advances in technology
use E-commerce / digital marketing because it can increase global/national brand awareness, reduced costs & new growth opportunities
outburst of numerous & massive social networks & blogs like advertisement in magazine, music videos, internet
enhances customer responsiveness
improving an effectiveness the apparel supply chain
eg: Zara has use information technology (IT) to track abt what product customers want but cannot find in stores, they will designed, manufactured & sent to the stores within 2 weeks
new customers in emerging markets
Asia has fastest growing industry & better economy, so many fashion industries looking to Asian for their best target market
eg: H&M
globalization of competitors
many popular fast fashion lead the way in selling a wide variety of trendy, low-priced clothes on a global scale so the competitors are increased.
eg: Forever 21 & Cotton On
The Impacts of Globalization in fashion
Fast fashion places its emphasis on inexpensive manufacturing, allowing retailers to sell current fashion trends at low prices
increased trade gives people more goods & services
create jobs & raises standard of living - increase an employment rate
companies lower costs & prices by buying materials & hiring workers from other countries
production - more investment in developing countries due to cheap labour
multinational corporations (MNCs) operate in multiple countries in order to gain raw materail, assemble product& sell throughout the world such as Nike
impacts
change individual preferences
global style emerged
a way of bonding people
unleashing each countries traditions & cultures
piracy becomes a problem which could hurt credibility and trust from the target market
The issue of globalization in fashion
child labour
low wages
health & safety risks
environmental degradation
animal cruelty
Trade
(i) Level of Trade
International trade: any exchange goods involving 2/more countries
Global trade: potential interactive participation of many group, cultures & nations in the manufacturing & distribution of products
Measuring levels of trade: exports - imports = trade balance
(ii) Balance of Trade
Imports: goods that come into a country from foreign sources that country buys from other countries
export: goods that country sends to a foreign source
balance of trade: relationship between a country's imports & exports, affects the economic health of a country
(iii) Trade Agreement & Restrictions
tariff
tax levied against imported goods
revenue tariff; designs to raise funds for the importing government
protective tariff: designed to raise the retail price of an imported product to match / exceed of a similar domestic product
(iv) World trade policy
trade deficit
occurs when import exceed exports
eg: the U.S trade deficit is large so more products are imported into the U.S market than exported
trade surplus
occurs when exports exceed imports
eg: Japan has large trade surplus, therefore it results in large amount of money for the exporting country