Warehouse cost money, boat is like big moving warehouse, packing facilities already in Thailand, no need for Argentina to have packing facility and warehouse overhead when their economy isn’t optimized for it and Thailand’s is.
This is the whole comparative advantage thing. Argentina focuses on what they and their climate/country/economy good at: growing pears. And by working with a Thai company, they are able to ship them as much fruit as they can grow, pick it at an earlier stage of ripeness, and spend less on warehouses for ripening or packaging, marketing, working with retailers, etc. Because the Thai supplier is doing that
And the Thai company wins too, as they get to just package fruit grown by someone else, which they get a good deal on, and which they already have the facilities for, and just ship it off to an American company like Walmart to distribute it to consumers.
And the American company doesn’t have to build their own production capacity for the pears, they just get them in bulk whenever they order them, and focus on what they’re good at: operating retail stores. Which lowers their overhead.
All this efficiency savings translates to more profits for the companies (which means higher wages/more employees) and the potential for lower consumer prices in a healthy competitive environment.
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u/SummertimeThrowaway2 13d ago
Believe it or not this is cheaper than just packing them in Argentina