Commodity chains Essay Example | Topics and Well Written Essays - 1250 words

Commodity chains - Essay ExampleProduction and demand of shoes by consumers are the cardinal main elements focused by companies in the industry. The production factors that include land, capital and labor influence the manufacturing of these commodities. Before globalization, many companies were unable to take advantage of cheaper investment funds and labor costs in other countries. Luckily, it has now become a norm for shoe companies to invest in other countries due to trade agreements and frugal integration.The materials utilized in making of shoes poses a threat to the environment as production is characterized by use of energy, chemical, greenhouse gas discharge, water and strong waste. In the past ten years, however, the company has strived at utilizing environmental friendly alternatives to various resources that are incorporated in the production of shoes, such as cotton fiber, leather, polyester and rubber. This has significantly reduced environmental implications of the materials (Michie 268).The production of footwear is handled by contract factories situated in various countries notably in Asia due to the available raw materials and dispirited production cost. The production of shoes is conducted in two stages as the primary level involves the extraction of raw materials vital in the production process. A couple of shoes incorporates various materials including rubber, leather, plastics, adhesives and conventional cotton. In the production process, some of the raw materials come from close proximity with the firm or from other countries. This is because the raw materials including cotton and rubber are often imported from counties oversees. Leather is a product of farm animals, as rawhide is purchased by companies from farmers and is eventually transformed into leather that is vital in the production of shoes (Michie 268). Many companies own facilities in Indonesia, Thailand and Netherlands where the production of leather is