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Homework answers / question archive / Valid reasons to consider building a new plant in Latin America include the strong preference that Latin American consumers have for purchasing branded footwear with a lower S//Q rating, as compared to North American or European consumers

Valid reasons to consider building a new plant in Latin America include the strong preference that Latin American consumers have for purchasing branded footwear with a lower S//Q rating, as compared to North American or European consumers

Operations Management

Valid reasons to consider building a new plant in Latin America include the strong preference that Latin American consumers have for purchasing branded footwear with a lower S//Q rating, as compared to North American or European consumers. the much weaker competition in both the branded footwear segment and the private-label segment that prevails in Latin America, which acts to boost profits on footwear sales in Latin America. the lack of any need to pay a piecework incentive to plant workers in Latin America. being able to avoid paying import tariffs on footwear sold in Latin America when the pairs are produced at the Latin American plant and shipped to the distribution warehouse in Latin America. the fact that Latin America is the lowest cost region in the world in which to produce athletic footwear.

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the fact that Latin America is the lowest cost region in the world in which to produce athletic footwear

Owing to the prevailing lower standards of wages in Latin America, the Plan workers are paid less when compared with the other Continents, other than in Asia. Therefore the input cost of production, being less, one can consider building a new plant in Latin America to avail the advantages of the same.