Wrinkling out the world to be ever so flat

With a vast array of large companies moving their factories to China where labor and healthcare are cheaper, its no wonder that offshoring has been so good for companies to lower the cost and in return lower their price to the consumer. But ask yourself why is it different than outsourcing, which they were doing before? It’s simple really! Outsourcing is taking something that you make and sell and paying someone else to make it for you. So they could pay less to the factories in China than the ones they owned in the US. But with offshoring its taking the factories that you own and moving all the equipment to some place overseas. The company still owns the factory instead of paying another company to do the work for them.  This allows them to still control their chain of supply. But as far as chains of supply go no one has found a better way to do it than a company that started Arkansas, and has spread all over the world. That company is Wal-Mart. This company knew the only way to sell items cheaper than their competitors was to get it cheaper. This started with them cutting out the middle man and buying direct from factories and setting up their own distribution centers. Then having the same truck that taking items from those centers to stores driving a little more to pick up the items at the factories cutting the delivery cost. Then introducing a system that shares sales with the manufacturer so they know when to up production and when to slow down so that the right amount of any given product is on the shelf. All these, plus many more have cut the cost of doing business. Which in turn Wal-Mart has used this tactic to under sell the competition and drive them out of business. This has changed how all companies are working to the point that others have even tried to mimic Wal-Mart and their chain of supply. But Wal-Mart’s supply chain is not the only factor that’s had an impact on business. Another force that made companies change is Google. The way that a consumer can look up info on anything they want in so many different languages has made the consumer an intelligent well informed buyer and able to find the product at the cheapest place, while the book doesn’t go into detail on this, many stores like Wal-Mart have to price match on-line stores found on Google. Google helps the buyer in multiple ways, you can read the reviews left by people who have purchased this product, find stores in your area that carry the product and which one has it for the best deal and finally they will even give you a map and directions on how to get there.