The business horizon for any business in the US or for that matter any company in the world anywhere has changed considerably. Initially the companies used to think the home territory as their own but that is not the case anymore.
More and more companies from outside the US are coming and doing business here and vice versa is also true.
When the foreign companies come and do business in the US they have access to cheaper pool of labor and great amount of subsidies for them by the government. Sam is not true for American companies and hence they have very high cost structure.
That said you cannot compete with that company on the cost alone if everything is the same. The playing field is likely to become uneven. So what options are you left with as a company. You will have to do the same as that company is doing and that is get into a lower cost structure. The aim for you is to reduce the cost for your for a lot of things.
The answer to that is simple. Go to the third world developing countries and outsource. The way outsourcing works is that some of the work can be done from people who are sitting far away from your location. One example being answering the phone calls for the customers. Anyone can answer the customer's phone call if she has a phone connection. Now if that person happens to be in India, Brazil or Philippines hardly makes a difference.
So make sure that you identify the services which can be pruned here and then hire a company in that country which will do the business for you. It is very true in case of information technology related where there is no customer interface and a lot of companies are doing the work from India mainly.
The other benefit of doing this apart from cutting costs to get that competitive edge is that you can use the freed up labor for more productive use here. Also the time zone difference helps because then you have people working for you 24x7.
A lot of people are against the sending of work to other countries as it reduces the amount of work US people will have but the fact is that in this competitive world you will not survive with this cost structure. So the choice is between survival as a company and the pruning of employee base here.
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