Look for Offshoring to Rip an Even Larger Hole in Your Local Economy

I hate to say that I told you so, but I did. I've been writing about the negative impact of offshoring on local economic development for the last three years.

Pay attention to this trend, please. Don't believe the distorted picture that "our friends in Washington???" have been telling us.

Your area cannot compete against offshore locations the way the "economic development game" is being played. Click here to learn about a possible alternative. If you follow the path I've outlined in this article, you stand a somewhat greater chance of repositioning your area in the global marketplace.

Now, read this latest outlook on what offshoring will mean to US companies in the next three years...

Executives at U.S. companies with sales over $1 billion annually expect income generated outside the country to grow to 42% of total annual sales over the next three years.

This is the third year of the study sponsored by Accenture, conducted by S. Radoff Associates. The survey includes responses from 160 sales and marketing and supply chain management executives at companies with large revenues. Expectations this year are for offshore revenues to represent 35% of total sales. The figure was 26% three years ago.

Of all global markets, China represents the most important emerging market and 82% of those responding indicated they intend to upgrade operations there. India is the second most important market, garnering 56% of interest from respondents, with Eastern Europe having importance for 38% of those responding indicated they intend to upgrade operations there.

While these statistics seem rosy, things could be better. Some 47% of those surveyed say that poorly designed or executed global operations strategy contributes to a failure to grow market share in these emerging markets. Further, according to the study, 40% of the companies feel they don’t have a global procurement, manufacturing and distribution network that will deliver product on time, on budget.

More here.