Research Essay Example on Production of Goods

Production of goods is the most important factor in an economy; everything we buy is a result of a trade of exchanging money for a product. Companies create and sell products to a wide variety of consumers, all with different jobs and lifestyles, and each purchase improves the economy. A supply chain has many branches and paths, so I want to research the process of products from start to finish and the different jobs involved in this process. ​​Every product is the result of a supply chain, and according to Kenton W's article, Supply Chain Definition, a supply chain is an entire process of creating and selling commercial goods. There are four main types of work when it comes to the production of goods, raw materials, manufacturing, distribution, and retail.

All four steps start with an idea, someone thinks of a way to make money with a plan they create. Depending on several factors like how hard they work or how great the idea is, it could be a complete success or a complete failure. Being the person with the idea and acting on it is risky and incredibly tough, according to the article, How Many Startups Fail and Why? By Sean Bryant, as of 2021, 20% of startups failed in the first year, 50% within five years, and 65% within 10 years. This fact shows how difficult it is to thrive in a startup business; not only is it laborious to last with your business, but it can cost somewhere around 3,000 to 200,000 dollars depending on the size of the business, according to the article 14 Business Costs Owners Need to Know by Randa Kriss. Assuming that you have the funds to create a business, you would now need to go through various steps to set it up. As explained by the guide on 10 Steps to Start Your Business by the Small Business Administration, the steps to start the business are to find a location, a business structure, choose the name of the business, legally register your business with the government, acquire an employer identification number, obtain licenses and permits, and open a business bank account. After the beginning phases for all businesses, they can all take different paths and build a completely different workplace. To keep things simple, I will be talking about the long and complex process of an object we use on a day-to-day basis, which is the iPhone.

Raw materials are substances that come from the earth and can't be handmade. These materials are used to make billions of products in manufacturing, and there are numerous organizations that collect these raw materials and sell them for profit. The different types of raw materials include plant-based, animal-based, and mining-based as described in the CIN7 team’s Detailed Guide To Raw Materials. Raw materials are mined through explosions, machinery, or mining, which can damage animal environments. IPhones are created from several different mining materials, including Aluminum, Iron, Lithium, and more. Mining is carried out in open-pit or underground mining, and the specific jobs created by the mining industry include construction jobs, equipment operators, engineering, and human resources, as identified by the article Understanding The Different Type of Mining Jobs from EnergyJobShop. The pay for these jobs is excellent, with an average annual salary of $72,000 in the coal mining industry, which itself provides 500,000 jobs, as reported in the article Mining Industry Profile by Energy.Gov. After the raw materials are collected, they are sold to manufacturing companies for a profit, which is then used to pay workers and continue mining the next day.

Manufacturing is the process of transforming raw materials into a finished product mainly by machines and technology, while workers do separate jobs on the side. These companies provide us with every object we own and also greatly contribute to the economy by creating almost 12 million jobs and paying an average of $60,000 to workers according to the article Manufacturing Still Among Top Five Employers by Adam Grundy. The process of manufacturing raw materials into the final product is the most complex of all four supply chain business types, and there are several different jobs involved in the making of a product. According to the “Manufacturing Jobs” article by Indeed’s editorial team, the jobs included in creating an iPhone are assemblers, warehouse workers, quality control inspectors, technicians, welders, millwrights, packaging engineers, and plant managers. Raw materials are supplied to manufacturing factories, where they are then placed in a lengthy process that Apple claims is 24 hours long, where they are then welded into parts, made into technology, and then put together to complete the iPhone. Although these companies buy the raw materials for cheap, they will sell for much more than they cost, for example, an Apple iPhone 13 costs $570 to manufacture, but they sell them for around $999 - $1,449. 

Product distribution is the process of delivering products to a retailer by transportation, paid for by the manufacturing company. Once manufacturing has completed its job, they hand over the product to distribution so it can be sold. The biggest distribution company is W.W. Grainger, which has 25000 members and 330 locations according to the information on Industrial Distributions Big 50 list by Mike Hockett. The different ways companies can distribute their products are online through sites like Amazon and then ship by companies like FedEx, or they distribute it to retail stores which are done through distribution companies. The jobs in distribution include warehouse employees, drivers, and distribution managers. According to the article Warehouse and Storage, it has 3.4 million employees and pays the least amount of money of all the other companies with an average of $34,000. Manufactured goods are transported by truck in the country, but continental sales are moved by cargo ships. Manufactured products are held in a warehouse, where distribution vehicles can easily pick them up and then deliver them. Vehicles arrive at various retail locations and sell the products to stores, making money for the manufacturing company and also the distribution, as they get paid for the delivery. Since iPhone is a continental company, it distributes by both land and sea, and supplies its products to various third-party distribution companies, as stated in the article Apple Distribution by FourWeekMBA.

Retail is something we all know and understand, they’re the stores you can find anywhere on the street and get everything you own from. Some of the most prominent retail companies include Walmart, Target, Safeway, etc. These retail companies need to compete with each other because they all sell the same products and need to find a way to differentiate themselves or else they will go out of business. These companies differentiate themselves by lowering prices or offering special offers to loyal customers. Jobs in retail stores include managers and workers, workers take up the jobs like restocking and cashiering while managers oversee all workers. Retail provides the most jobs in the supply chain with 32 million jobs according to the NRF website article on retail jobs. Retail receives complete products like the iPhone from distribution companies and then keeps them in stock until they need to restock their shelves, people walk into the store searching to buy something and can end up buying the finished product ending the process of a product in the supply chain. Every retail store charges a price higher than what they bought it from the company for because they need to make a profit off the items, and a strategy they often use is saying there's a sale on items when it is just the same price.

In order to get some higher-paying jobs in these companies, you need degrees in a specific field and a specific degree level. These companies pay well for someone who knows how to operate technology, or a manager that knows his job well because they specifically studied those subjects. All you need to obtain the manager's position can vary for every company, but it mostly takes 2-4 years studying business administration in college for the degree. There are countless different majors or minors you can study in college, and they can define what your job will be, for example, having a major in business and a minor in music could land you a decent job at a music company.

As we saw from all the information gathered and presented, the supply chain is an incredibly complex system that relies on all other systems within itself in order to function. The supply chain greatly affects the economy and without it, millions of people wouldn't have jobs and billions of products wouldn’t be made. My essay only scratches the surface of the supply chain because there is only so much the internet can provide, but I want to continue to learn more about how these companies operate. From looking at all this research and writing this essay, I am certain that I want to go into business because I have much more understanding of the jobs and what I want to do in the future.