[genmud]

Just speaking from experience, often times offshoring isn't actually that much cheaper. The total cost of ownership often times is not calculated correctly, or because of the way financials are done, give incentives to move costs around to make stock numbers look better. For example, if a company said they reduced the cost per unit to offshore production by 50%, but don't mention shipping has tripled and quality has gone down, in addition to costing a ton of money to transition, only netting 10-20% savings, the market often only cares about the unit costs.

I would say the number one thing people do is they don't allocate overhead or things like shipping/logistics/lead times into the total costs.

Like for example, if it takes 3 months to have a product, you should store more inventory than if you were doing it in the US. You also shouldn't just look at just the raw unit price, you factor in shipping, quality assurance checks, inefficiency of engineering changes, etc. which many people don't actually do.

[rawTruthHurts]

Thanks for the insight. From my layman point of view, 10%-20% savings in the long run still looks like something to go for, taking as a reference the multinational I work for, where a 7% saving on whatever is seen as a triumph. I'd say the greed point still stands, the additional logistics involved are just how it works.