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Transcript

OFFSHORING

WHAT IS OFFSHORING ??

WHAT ARE THE TRUTH AND CONSEQUENCES OF OFFSHORING ?

I.THE TYPES OF OFFSHORING
II.ADVANTAGES AND DISADVANTAGES
III.SOME EXAMPLE
IV.CONCLUSION

PRODUCTION

Production offshoring is one in which company set up its production unit in a distinct country for availing benefits of cheap factors of production. It imports finished products from such country for selling them in their domestic country.

SERVICES

Actually, when a company establish its service-related operations in some other country, it is termed as services offshoring. These services comprise of accounting, information technology, marketing, customer support, sales and many more.

INNOVATION AND SOFTWARE

It is an offshoring under which high-tech companies like those in Silicon Valley offshore their innovation work to nations such as Africa, Ukraine, Mexico and Colombia. This enables companies in hiring competent human resource at cheap rate which bring down the overall cost and makes production cycle shorter.

RESHORING

Reshoring simply refers to the opposite of offshoring and is also termed as inshoring, onshoring or backshoring. It involves bringing of manufacturing operations and other types of jobs that were offshored back to the company’s original country.

TYPES OF OFFSHORING

ADVANTAGES OF OFFSHORING

LOWER LABOUR COSTS

ACCESS TO SKILLED LABOUR

INCREASE REVENUE

ADVANTAGES OF OFFSHORING

LANGUAGE BARRIER

COMMUNICATION ISSUES

SOCIO-CULTURAL PROBLEMS

UNEMPLOYMENT

DISADVANTAGES OF OFFSHORING

LANGUAGE BARRIER

COMMUNICATION ISSUES

SOCIO-CULTURAL PROBLEMS

UNEMPLOYMENT

EXAMPLES

AMAZON

The Ecommerce and technology giant, which already wielded outsize clout before the crisis, has gained more than $600 billion on its market capitalisation in 2020. Amazon reported a year-on-year revenue increase of 40%, bringing in a total of $88.9 billion in sales. Actually, Amazon earns 13,995$ per second. Amazon sales statistics for the first quarter of 2021 show that every minute Amazon earns around $837,330. This means that the company makes more than $50 million every hour.

GENERAL ELECTIRIC

The company disclosed that it is currently holding more than $108 million in various offshore accounts by the end of the year 2020. The company has offshored in Bermuda, Singapore, Ireland, and the Bahamas.

THANK YOU FOR YOUR ATTENTION

BINGOL CANSU
MADANI AHMED