Problem:
After conducting a SWOT analysis on competitors operations, the Uniform and Linen Leasing Company (U&L) discovered one of their largest and looming threats is in the area of increased operational costs. Some of these expenses are: rising labor wages, worker's compensation, an increased and aging retirement population with pensions and miscellaneous benefits, rising state unemployment insurance, and rising healthcare costs. U&L has decided to expand and open a manufacturing facility in China as part of their strategy to lower these types of expenses. The plant will be used to manufacture uniforms.
Do you agree that opening a new facility in China will alleviate increased operational costs for U&L? Describe benefits and challenges to support your answer.