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On December 1, 2017, TOM2017 commented on Steel Tariffs: Making America Competitive Again? :

Thank you for the interesting essay! Foreign practices such as dumping are certainly harmful to American steel companies. However, I think it’s also worth investigating the consequences of dumping for the consumer. When China and other countries dump steel into the US, they reduce the price for US consumers to below market rates. In other words, US consumers essentially receive a discount. Therefore, the public policy case for combatting dumping has to depend on more than just the cost for US steel companies.

One reason to ban the subsidies would be to protect US jobs and businesses. If that is our objective, how do we weigh the cost to consumers against the benefit to US steel producers? Another reason to combat dumping could be the long-run implications. If Chinese companies providing cheap steel drive American firms out of business and raise prices tomorrow, we are worse off.[1] But if there is a competitive international market for steel, Chinese companies may never be in a position to raise prices above market rates.

Thank you for the interesting essay! I think it will be challenging for Bombardier to maintain confidence in the program, but there are a few steps they can take. First, Bombardier should try to enlist the airline industry as an ally in combatting these tariffs. Increasing the costs of airplanes hurts Delta and other carriers’ bottom lines. The airline industry may have the lobbying clout to help reverse this ruling. Second, Bombardier should try to utilize the Airbus partnership to keep the program running. For example, the two companies could offer discounts to airlines that order both the Bombardier C-Series and Airbus aircraft. By providing these sorts of incentives, Bombardier can keep the C-Series alive while they work to start up US-based production.

On December 1, 2017, TOM2017 commented on Gap: Making Supply Chain Fashionable :

Thank you for the interesting essay! One challenge fast fashion will face as it moves to more upscale market segments is maintaining quality. A customer may be willing to forgive a certain level of defects from Zara but expect more from a pricier purchase from the Banana Republic. While achieving both speed and quality is not be impossible, it will undoubtedly be a substantial operational challenge.

Additionally, speed may be more of a competitive advantage for Zara than it is for Gap. Zara’s brand image is closely tied to fashion – consumers come to Zara seeking the cheap but cutting edge. On the other hand, Gap’s brands are more closely associated with reusable basics rather than high fashion. Given these two very different brand images and strategies, I worry that speed is more beneficial for Zara than it is for Gap.

On December 1, 2017, TOM2017 commented on Let’s Get Digital, Digital! :

Thank you for the interesting essay! As children turn to digital entertainment, one question for Mattel is whether the company can build solutions on third-party platforms or whether they should focus on developing original devices. For example, would Mattel be better off licensing its intellectual property for a PC or Nintendo game or building digitally-enabled devices internally? Utilizing other companies’ platforms seems easiest in the short-term, but it may also jeopardize the company’s long-term value proposition.

Additionally, I think digitalization of the supply chain has unique advantages in a seasonal business like toys. There is a relatively narrow window for Mattel to meet retail demand. A digital supply chain and closer integration with retail partners could help Mattel keep the shelves stocked during the busy season, ultimately driving incremental sales.

On December 1, 2017, TOM2017 commented on Climate change, food security, and General Mills :

Thank you for the interesting essay! General Mills might strengthen its effort to combat climate change by launching a consumer marketing and education effort. With a marketing campaign, General Mills could build consumer awareness about their investments in water conservation and environmental protection. This would have two benefits. First, General Mills may need to increase prices to offset its investments in environmental protection; educating consumers could make them more likely to accept these pricing changes. Second, advertising may lead consumers to pressure General Mills’ competitors to increase their own investments in environmental protection, which would help reduce the competitive disadvantage of incurring these costs.

Ultimately, I think General Mills should invest in mitigating climate change because it is the right thing to do – not because consumers demand it. However, with the right marketing strategy, General Mills might be able to align consumer preferences with doing what is right.

On December 1, 2017, TOM2017 commented on Climate Change: An Existential Threat for AB InBev? :

Thank you for the interesting essay! I think investing in technological development has the potential for tremendous impact, but it may also be difficult for AB InBev. Genetically modified crops seem like one of the largest areas of opportunity. If AB InBev and its partners develop and deploy drought resistant-seeds, they could maintain much of their current supply chain despite the consequences of climate change. However, the company faces substantial barriers to introducing GMO crops. InBev is a truly international company that sources raw materials and sells beet from around the globe. Many consumers are wary of GMOs, and 17 European countries have even imposed bans on cultivating GMO crops, citing health concerns.[1] Before GMOs can be used to combat climate change, InBev may need to overcome substantial consumer and political opposition.