Manufacturing Industry Analysis
Manufacturing Industry Analysis
Manufacturing industry refers to businesses that employ machines, tool, labors, chemical and biological processing to convert raw materials to finished goods on a relatively large scale. This industry makes up a sizable portion of the industrial production sector in developed nations. It also boosts the economic growth and creates jobs. In 2013, manufacturers contributed $2.8 trillion to the economy, up from $2.03 trillion in 2012. This was 12.5% of GDP. For every $1.00 spent in manufacturing, another $1.2 is added to the economy, the highest multiplier effect of any economic sector. Manufacturing ...view middle of the document...
Economic | GDPCPI | High | Opportunity | Manufacturing more at a lower cost to achieve econ of scale and accounts for a large portion of GDP. |
Global | Outsourcing and globalization | High | Both | Outsourcing production line to emerging market is a way to lower the cost but also exposing threat to the quality and safety of products. Globalization of free trade |
The general environment analysis help us bettter understand the current state, trends and overall performace of manufacturing industry. General environment analysis contains several factors including demographic, sociocultural, political/legal, techonology, ecomonic and global. In terms of Demographic factor, changes of sex, race, religion and education, etc may affect the business. manufacuring companies recruit more skilled and knowledgeable workers with manufacturing expertise to do the daily manufacturing works as well as fulfill some relative important managerial positions. Sociocultural may affect the industry’s trends that has posed both threats and opportunites to the industry given the facts that there are more and more women and temporary workers engaging in the manufacturing industry that bring diversity and productivity, however, on the other hand, Temporary workers also bring inconsistency and instabilities to the workplace and therefore interrupt the normal business operations. Ever since the financial crisis in 2008, goverment and related regulatory depatments have placed rigid regulations and policies in every industry including manufacturing, as a result, more and more regulations have been put into places to regulate the safety of the products as well as the welfare of employees, but the wage for manufacturers are still relatively low that may lower workers’ incentives to work hard and produce high qualities of products. In terms of echnology, an introduction of varieties of innovated tevhonology helps increase the productivities and lower the production costs. For economic factor, GDP, CPI,etc are all economic measurements to evalute the overall performanee of the indudtry from economic perspective. As more and more production costs and labor cost being reduced along the way of manufaturing, economic of scale, which accounts for a large portion of GDP, kcould be achineved as well as the efficiency of manufacturing. Finally, for global factor, outsoursing and globalized free trades have been a trends for most of the manufacturing companies. comapnies outsourced some uniportant activities to the third party, that ways, companies are able to focus on key activities and lower the cost otherwise occurs if manufacturing by themselves. however, this approach has brought threats as well in the sense that qulitiies and high standards might be sacrificed and companies may loss control over suppiers and as a result, negetively affect the business in the long run.
Competitive Environment Force | Threat Analysis | What are...