What is a benefit to an Australian clothing company of outsourcing its manufacturing overseas?
A - HSC - SSCE Business Studies - Question 15 - 2018 - Paper 1
Question 15
What is a benefit to an Australian clothing company of outsourcing its manufacturing overseas?
A. It can control the production costs.
B. It can lower human resour... show full transcript
Worked Solution & Example Answer:What is a benefit to an Australian clothing company of outsourcing its manufacturing overseas?
A - HSC - SSCE Business Studies - Question 15 - 2018 - Paper 1
Step 1
A. It can control the production costs.
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Answer
While controlling production costs is important, outsourcing often provides a fixed cost alternative rather than direct control over the manufacturing process.
Step 2
B. It can lower human resource compliance costs.
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Answer
This option highlights a significant benefit of outsourcing. By outsourcing manufacturing to countries with lower labor laws, an Australian clothing company can reduce its own human resource compliance costs significantly.
Step 3
C. It can decide which particular employees manufacture its products.
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Outsourcing usually limits the ability to choose specific employees, as production is handed over to a third-party manufacturer.
Step 4
D. It can consider the foreign manufacturer’s workers as its own employees.
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This is not typically accurate. The foreign workers would remain employees of the overseas manufacturer and would not be considered employees of the Australian company.
