Challenges Faced by Small Producers Due to Globalisation

Globalisation refers to the process of interconnectedness and integration of different economies, societies, and cultures across the world. This process has led to an increase in the movement of goods, services, capital, and people across borders. While globalisation has brought about various benefits, it has also posed major challenges for small producers. Here are a few reasons why:

1. Competition from large corporations

Globalisation has led to the emergence of large multinational corporations, which have significant advantages over small producers. These large corporations have access to more resources, technology, and economies of scale, which enable them to produce goods and services at lower costs. This puts small producers at a disadvantage as they cannot compete with the lower prices offered by large corporations.

2. Limited access to markets

Small producers often have limited access to global markets due to various barriers such as tariffs, quotas, and regulatory requirements. These barriers make it difficult for small producers to sell their products in foreign markets, which reduces their market opportunities and revenue potential.

3. Dependence on local markets

Small producers are often dependent on local markets for their revenue, which limits their growth potential. This dependence on local markets also exposes them to local economic fluctuations and risks.

4. Lack of resources

Small producers often lack the resources such as capital, technology, and skilled labor needed to compete in the global market. This restricts their ability to innovate, improve their quality, and reduce their costs.

Conclusion

In conclusion, globalisation has posed major challenges for small producers due to increased competition, limited access to markets, dependence on local markets, and lack of resources. To address these challenges, small producers need to adapt to the changing global market by improving their competitiveness, accessing new markets, and innovating to reduce their costs and improve their quality.

Globalization means taking your business to the global (international) level by means of expansion , modernization , and the very famous - Use of technology like internet and company sites. There are many examples of companies which grew manifold using best and hi-tech marketing techniques like Amazon , flipkart, snapdeal and so on. These companies also start their own production process once they have enough capital to invest. But ,the small scale producers and traders which deal in the same commodities suffer a huge impact as the same goods are demand by the consumers but they prefer to buy them from the global companies as the companies provide various facilities like home delivery, cashback, festive sales, quality products , money back guarantee, warantee period and so on. Thus globalization has posed a major challenge to the small scale traders having low capital investment and poor strategies to develop.