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Unformatted text preview: Answer: Possible disadvantages of outsourcing are that the supplier loses control over the quality of the product, as well as the timing of production. Also, the company exposes itself to price changes caused by changes in the value of the foreign currency. In addition, shipping large, heavy products such as tires is costly, and disruptions in shipping (due to strikes, weather, etc.) can cause delays in final assembly of vehicles. As a result of the outsourcing, the company will have to reassign, or even lay off, many skilled workers. Not only is this very disruptive to the lives of those employees, it also hurts morale of the remaining employees. As more U.S. employers begin to use robotic automation in their facilities, they are able to reduce the amount of labor required, and thus are beginning to be able to compete more favorably with foreign suppliers....
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This note was uploaded on 11/08/2011 for the course ACCOUNTING ac 202 taught by Professor - during the Fall '11 term at Montgomery.
- Fall '11