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Sourcing from low-cost countries can have advantages and disadvantages when analyzed. It is a common practice for companies to source from low-cost countries in an
Sourcing from low-cost countries can have advantages and disadvantages when analyzed. It is a common practice for companies to source from low-cost countries in an effort to save on production costs and remain competitive against other companies. Companies will source from low-cost countries because of the significant overall reduction in production and labor costs. These low-cost countries have lower wages and supply chain costs than if produced in a higher-cost area. Often the major disadvantage to sourcing from low-cost countries is the ethical concerns that arise. Many companies, like Nike, have been called out due to their unethical wages. Other issues that come from. sourcing from a low-cost country includes the lack of environmental sustainability, unstable work conditions, and lack of worker protection. These concerns can lead to company boycotts and legal reparations. Despite having significant cost benefits, companies that source from low-cost countries must weigh the lower costs against the risks of ethical concerns.
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