The Real Costs of Nike Air Max. Why Companies Outsource Their Production (PDF)

Seminar paper from the year 2018 in the subject Business economics - Operations Research, grade: 1,4, , language: English, abstract: The following work deals with the topic of backgrounds of outsourced production in Asian countries at the example of Nike.
According to philosophers like Thomas Hobbes and Karl Marx, humans have a self-interested nature because they first think about their own advantages without thinking about consequences of their behaviour when they save costs. Companies like Nike save costs by outsourcing their production into Asian countries, and consumers save costs by spending as little money as possible.

The negative consequences of that are the employer's bad working conditions which include a poor place of work with too little space, too many working hours per day despite low salaries and the risk of health problems due to work with glue. Moreover, this causes a bad reputation for Nike itself. A more general disadvantage is the widening gap between rich and poor, which leads to inequality and a lack of motivation of the poorer people.

Nevertheless, there are advantages for the Asian countries. Companies and factories are created and by that, places of employment are created which means a regular income and the possibility of exportation of products. Furthermore, the factories have to pay taxes which can be invested into a social system and the infrastructure. In spite of these advantages, there is the need of improving the conditions of outsourcing the production.