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Running Shoes Production
In order to demonstrate how industry works, I created a tour (which can be accessed through the file provided at the bottom of the page), using the Google Earth program, of how running shoes, specifically Nike brand, are produced. I chose to use running shoes because they are such an integral part of my everyday life (since as I run cross-country, indoor track, and outdoor track). Also, I felt that running shoes are a product that, while consisting of more than two basic components, are relatively simple to make, compared to such products as a car. Therefore, it would be easier to demonstrate how industry works with running shoes than with a more complicated product, while at the same time more effective than demonstrating the phenomenon by the creation of an overly simple product. To create the tour, I began by researching what parts went into creating the shoes. After learning about the individual components of the shoe, I figured out where each was manufactured. I learned that Nike (infamously) produces shoes in factories in less developed countries such as China and Taiwan. However, the shoes are simply assembled at these factories. The individual parts, such as the gel silicone, rubber, and mesh composing the shoes are manufactured in other factories and then exported to the main Nike factory. After determining the locations of the individual parts factories, I created a Google Earth tour of the whole process. I moved from the location of each factory for each part, and ended at the Nike factory in Taiwan. However, it is important to note that this is just an example of how running shoes are made. Not all Nike shoes are made at their Taiwan factory, and not all of the parts for the shoes come from the factories featured in the tour. This is just a specific example of the process.
Site and Situation Influence on Running Shoe Components
The influence of site and situation on the selection of the components of running shoes is minimal. There are basic elements that make up running shoes. For example, rubber is necessary for the sole, plastic is necessary to retain the shape of the shoe, and silicone is necessary for the midsole. Therefore, the influence of site and situation on the selection of components is minimal, because there are basic materials that must be used. As far as site goes, Nike can choose where to buy the different components needed for the running shoe. Since it imports the different parts to a central factory, it does not have to worry about site when selecting a company from which to purchase the components. However, Nike will be sure to buy the necessary parts from a company located in a less developed country, where the price of the product will presumably be cheaper. The site would influence the individual factory from which Nike is purchasing the part – it would build a factory near the raw materials necessary for their product, because all of the components of running shoes are goods of reduced bulk in finished form. Situation can play a more critical role for Nike in deciding where to locate the overall factory. The company is less likely to locate close to the component manufacturers, because producing running shoes is more of a bulk-gaining activity. Nike will be more inclined to situate its factory closer to the market, or at least the transportation centers that provide access to the market, because the individual parts being imported into the factory are, by themselves, lighter than the finished product. Thus, the bulk-gaining nature of the product makes it more economically beneficial for Nike to locate its factory closer to market. This is important in cutting down on the cost of the products, by reducing transportation expenses. Likewise, factories providing components to Nike might be more inclined to situate nearer the Nike manufacturing site, because they are bulk-reducing industries. Thus, the roles of site and situation are minimal in selecting the actual components of the running shoe, but more important for Nike in choosing where to locate and for the factories themselves in choosing which goods to produce.
Site and Situation Influence on Industrial Location of Running Shoe Factory
The main site factor that influences the industrial location of the actual Nike factory is labor costs. It is substantially cheaper for Nike to locate in a less developed area, such as Tae Kwang Vina, Taiwan, because the wage rates for the factory workers are much lower than they would be in a more developed country. Cheaper labor, in turn, increases Nike’s profits. However, there are many less developed areas that would be suitable for a Nike factory. To choose a location, Nike must also consider certain situation factors. Most important is the relation of the site in regards to Nike’s market, because the overall product is heavier than the individual parts that are being imported into the factory. Nike does not actually make the product in the more developed regions that constitute its market because it is cheaper to use low-cost labor and then ship the product to the market then to locate in the market region and use the higher-cost labor. Thus, Nike must not only consider the cost of labor, but also to means of transportation, such as ships and airplanes, by which to export the finished products from the factory in Taiwan to the overseas markets.
Practical Uses for the Google Earth Program
Google Earth, a major component of this project, is now mostly used for recreational purposes. However, its implications extend far beyond mere entertainment. The software is a valuable tool for examining potential locations to build such large-scale projects as factories. Google Earth can be used to take a closer look at a proposed construction sites without having to actually visit them. This is highly valuable for transnational corporations and other large businesses looking to establish overseas factories. Using the tool, they will be able to tour their potential locations without having to actually visit them. Looking at the site is helpful for two main reasons. It is important to know whether it is located in a business or residential area. More significantly, it is imperative to see the situation of the proposed location. Is it close to other manufacturers or natural resources that the factory will rely upon? Is it close to market centers or transportation centers? This information can be determined or verified using Google Earth. Thus, while used recreationally, Google Earth also has practical implications.
running_shoes_tour.kmz | |
File Size: | 26 kb |
File Type: | kmz |