DECREASING TARIFFS

The emergence of trade blocs, liberalization of economies and organizations such as the WT and GATT have all contributed to decreasing tariffs worldwide. But with the liberalization of the economy, the hitherto closed market was opened to foreign companies, and the existing tariffs were either drastically cut or eliminated.

TRANSPORTATION EFFICIENCIES

The modernization of transportation methods, the emergence of air travel as a feasible method of transportation, and the plethora of options available to transport goods has greatly decreased costs and reduced lead-times.

COMMUNICATION AND INFORMATION TECHNOLOGY

The proliferation of the Internet and the modernization of worldwide communication through the use of telephones, faxes and telexes has reduced the time required to communicate information across the globe. The conveying of real time information, the use of Electronic Data Interchange and other information technology has increased the visibility across the supply chain and facilitates the management of information.

GLOBALIZATION OF PRODUCTS AND SERVICES

In order to grow, companies will have to globalize in order to achieve economies of scale, efficiencies of operation and reduce the risk incurred by dependence on certain geographic markets.

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* Contributed by -
Ashwani Singh, PGDIE XXXIV,
Karuna Ladoti, PGDIE XXXV,
NITIE, Mumbai.