It truly is amazing to watch how small the world has become. The rapid developments in telecommunications have provided a big push this movement. The entire world is slowly turning into a common market, with the Internet playing quite a big role in this development. The progress in e-commerce is an example of how people from Canada can just as easily sell goods to those in Australia as they might to people a few buildings away. Businesses, both big and small, have not been slow to respond to the need to reach out to far wider markets than one could have thought of in past generations.



One of the outcomes of this coming together of the world is seen in the growth of off-shoring. Why should a company decide to take to off-shoring? The primary reason for this is that companies want to reduce their expenditure as far as possible. If this means having a setup on a different continent so that the costs may reduce considerably, so be it. Transportation is certainly not a problem in the world of today. So China and India have emerged as top off-shoring destinations for countries from all parts of the globe.





A familiar mistake that we all make is to assume that off-shoring is the same as outsourcing. Well, here is some information for you. The two are quite different. Outsourcing generally means giving out a contract to do a piece of work to an external company. However, off-shoring refers the transferring of a part of the operations to a different unit (either of the same company or a different one) but which is situated on different shores. Outsourcing could be done within the same country, but not off-shoring. The latter necessarily refers to a geographical distance.



Off-shoring is generally of two main types. These are production off-shoring and services off-shoring. The prime example of production off-shoring can be seen in the case of China, where production costs are quite low. Thus, companies that want to save on their production costs usually take advantage of Chinese locations to produce their goods.



As far as services off-shoring is concerned, one great instance is that of India. Thanks to the amazing expansion of the telecom industry and thanks to the great Internet boom, after the 1990s, there was an opening for regions which would incur lower costs to enter the services field. Thus, India, with her pool of English-speaking people turned out to be just what the doctor ordered.



Of course, off-shoring is a worldwide phenomenon which is extending its influence, and it continues to intensify its influence on the world stage.