Jeffrey, that should go without saying (but I will anyway) that if the company internalized a few of the steps, the price could still come out to $310 dollars and probably much less. However if the company did not pay it's CEO and top level executives monstrous salaries, the prices could fall to under $250 dollars (and again, probably much less).
In 2006, Jobs may have taken a 1 dollar salary, however his stock options were worth 646 million (http://www.macworld.com/article/57732/2007/05/jobspay.html). If he instead used that to pay his factory workers 25 dollars a day, 5 days a week for 52 weeks, it would have more than quadrupled their pay (I think the wage is around 2-3 dollars a day, but not 100% sure) and he would have been able to employ 99,384 workers, about the same number of people who populate the city of Green Bay Wisconsin.
Kenneth M. is right on the money. You know, of course, that the price of the iPhone would only increase from $310 to about $360 if workers were paid fairly -- and that includes all sub-suppliers & sub-sub-suppliers!
It is very effective "company propaganda" to say that eliminating exploitation would more than triple the price of products produced in sweatshops...
Kenneth J McGuire - 14 years ago
The lead-in statement that ;"nobody would buy aniphone ifit was $1000.00" overstates the impact of labor cost in a product. Direct Labor is rarely more than 18% in all products and usually much less in high-tech products. That would mean under $50 in one of the products made in these sweatshop factories described. If the factory was well managed the cost could likely be much less for touch labor. In fact if the costs were traced throughout the entire value stream from 'commodity to consumer' most consumers would be surprised at "who's getting the most" cost benefit from these products.
Labor cost is just a convenient excuse that's easy to use in order to explain 'outsourcing'. The outsourcing to places where exploitation is less visible to consumers soothes Senior Management's discomfort factor for accepting poor management practice. It masks US managers inability to cope with the management of the whole business spectrum of producion to consumption. It's a shallow company that cannot master the internal talent to make it's own product.
Jeffrey, that should go without saying (but I will anyway) that if the company internalized a few of the steps, the price could still come out to $310 dollars and probably much less. However if the company did not pay it's CEO and top level executives monstrous salaries, the prices could fall to under $250 dollars (and again, probably much less).
In 2006, Jobs may have taken a 1 dollar salary, however his stock options were worth 646 million (http://www.macworld.com/article/57732/2007/05/jobspay.html). If he instead used that to pay his factory workers 25 dollars a day, 5 days a week for 52 weeks, it would have more than quadrupled their pay (I think the wage is around 2-3 dollars a day, but not 100% sure) and he would have been able to employ 99,384 workers, about the same number of people who populate the city of Green Bay Wisconsin.
I'm sure he put it to much better use.
Kenneth M. is right on the money. You know, of course, that the price of the iPhone would only increase from $310 to about $360 if workers were paid fairly -- and that includes all sub-suppliers & sub-sub-suppliers!
It is very effective "company propaganda" to say that eliminating exploitation would more than triple the price of products produced in sweatshops...
The lead-in statement that ;"nobody would buy aniphone ifit was $1000.00" overstates the impact of labor cost in a product. Direct Labor is rarely more than 18% in all products and usually much less in high-tech products. That would mean under $50 in one of the products made in these sweatshop factories described. If the factory was well managed the cost could likely be much less for touch labor. In fact if the costs were traced throughout the entire value stream from 'commodity to consumer' most consumers would be surprised at "who's getting the most" cost benefit from these products.
Labor cost is just a convenient excuse that's easy to use in order to explain 'outsourcing'. The outsourcing to places where exploitation is less visible to consumers soothes Senior Management's discomfort factor for accepting poor management practice. It masks US managers inability to cope with the management of the whole business spectrum of producion to consumption. It's a shallow company that cannot master the internal talent to make it's own product.