| Name: |
MAJ USA RET
- 
|
|
| Subject: |
Outsourcing is a Business Decision.
|
|
Date:
|
7/16/2012 5:11:11 PM
|
A person (or persons) risks their personal capital to make a profit. Employees reap the benefit of have a job based on someone’s investment.
When the business needs a widget or a service… you look around for a widget vendor who makes a quality widget for a reasonable price. If widgets are of equal quality, you go for the lower price. If widgets are of equal price, you go for the better quality. (This explanation is not intended for intelligent folks… sorry.)
If you completely buy into that “buy American” idealism… you may end up with a higher priced widget of equal or lower quality. (This is a culture issue which I will not get into in this essay.) What if there are no “best value” widgets made in America?
The prevailing union argument is that you should raise the price or lower the profit margin to cover the extra expense for the American made widget.
If I’m an investor, I am not going to appreciate your volunteering my principle for your idealistic but poor business decisions. Maybe… likely… I’ll find a better place to put my money. Investors do that you know… that’s what brokers are for.
If you raise the price, you run off your customers. At least you will whack a nick into their loyalty.
(A little tug at your memory: 1981; Chrysler K-Car versus Toyota Camry.)
Suppose you insist on this NO OUTSOURCING business strategy. Customers stop buying your product because it costs too much… or it is junk. Your investors have taken enough losses… they have lost their confidence in you.
Then along comes a group of guys… with money. They say, “Look, your business can recover… actually, you can really make some money at this. IF you follow our business model and advice, THEN we will lend you the money to turn things around. Our money, plus a reasonable share of the profit, is due in full, at the end of five years. If you do not pay us back, the business is OURS… and you walk.”
a) You take their money and their advice and you… and they… and your employees… prosper. (a la Bain Capital)
b) You DON’T take their money and they walk away. You and your employees go down the tubes. (American Motors)
Make America an offer: “You make this Widget… to these standards… for a competitive price… AND WE’LL BUY AMERICAN.”
|
| Name: |
GoneFishin
-
|
|
| Subject: |
Outsourcing is a Business Decision.
|
|
Date:
|
7/16/2012 9:33:20 PM
|
I find it interesting that while US companies ship jobs overseas to make their widgets, Japanese, Korean, and German auto manufacturers build cars in the US with US workers. This includes Subaru, Toyota, Honda, Hyndai, Kia, Volkswagen, and BMW. GE has moved some of their large appliance manufacturing back to the US including plants in Kentucky and Georgia. One of the key elements to locating a plant for these companies is a source of high school graduates that they can train in their highly productive and advanced manufacturing processes. That is why a quality education is so important going forward as the old labor intensive manufacturing jobs will never return of the US as they are replaced by skiled labor with higher productivity that require fewer workers. I am concerned that no matter who is President and which party controls congress, returning the country to full employment may well be years away.
|
| Name: |
MartiniMan
-
|
|
| Subject: |
Outsourcing is a Business Decision.
|
|
Date:
|
7/16/2012 10:18:47 PM
|
Outsourcing is a total red herring but probably buys a few votes which is why Oblamer is beating that particular drum. The real question and one that will never get answered by politicians looking for votes is why so many corporations are moving business overseas. Taxes, regulations, uncertainty, etc. all play a role but in the final analysis they do it because they think it will improve company performance. Why is that and isn't that where we need to focus out attention rather than this populist nonsense?
As for GF's point, the simple reality is that these companies find it cheaper to assemble their cars in right to work states (with some notable exceptions) versus assembly far away and shipping to the US. Makes sense to me, especially since they are so committed to this market. I could provide a long lecture about full employment but that's for another time and another post. Besides, with our current debt levels aren't we being told that 8% is the new normal? If not, then the Messiah does not deserve a 2nd term and Carter definitely does not deserve his third.
|
| Name: |
MrHodja
-
|
|
| Subject: |
Outsourcing is a Business Decision.
|
|
Date:
|
7/16/2012 10:20:26 PM
|
You forgot Mercedes in your list.
A big part of the attraction of manufacturing to certain states is that they are right-to-work states and the unions don't have a stranglehold on the businesses. At one time in our history unions were a good thing.....negotiating a fair wage, reducing unsafe conditions and practices in the workplace, etc. But the unions didn't know where to stop and began to make such ridiculous demands that they actually hurt their own cause.
I was in Charleston last week and on one of my trips from the office to the hotel I drove past the new Boeing plant. It was really nice to see four brand spanking new, gleaming 787s, bearing different airlines' logos, parked out beside their behemoth factory hangar. Of course most know the story of the unions' grip on the NLRB and their attempt to keep the Charleston plant from opening....but again they overtstepped and the right thing happened...a company was given the freedom to build its airplanes where it was most advantageous for the company. This was an especially egregious power play by the unions in that Washington state (NOT a right-to-work state) didn't lose a single existing job because of the new plant being in SC. They just didn't get MORE jobs in WA.
|
| Name: |
MrHodja
-
|
|
| Subject: |
Outsourcing is a Business Decision.
|
|
Date:
|
7/16/2012 10:34:29 PM (updated 7/16/2012 10:35:54 PM)
|
Outsourcing by the Koreans to Montgomery has all kinds of benefits in addition to the jobs. Heck, before the Hyundai plant opened we had to go to Atlanta to get a Korean meal (spent two years in Seoul while on active duty and have an adopted Korean daughter). Now we have our choice of at least a half dozen in town and several Korean markets as well.
And if anyone drives the Atlanta to Montgomery corridor on I-85 it is easy to see that the actual Hyundai and Kia plants are just the tip of the iceberg. The tier 2 and tier 3 suppliers are multiplying like rabbits. More than once I have wondered "why in the world are they putting an off-ramp HERE?" A few months after it is complete the reason becomes quite clear: more suppliers building plants and needing access to the interstate.
GF, I am not so sure it would take the time you say to get back to full employment. What it will take is for the unions to revert to some sense of sanity in their expectations and create on the part of potential new businesses the desire to locate there rather than avoiding there because it makes no business sense to do so
|
| Name: |
GoneFishin
-
|
|
| Subject: |
Outsourcing is a Business Decision.
|
|
Date:
|
7/16/2012 11:39:42 PM
|
It would be interesting to talk to Germans, S. Koreans, and Japanese and get their opinion of outsourcing to the US. We have no problem moving their jobs to the US and all the ancillary supply jobs that become available. The support for outsourcing depends on whether you are the sourcer or sourcee country.
|
| Name: |
water_watcher
-
|
|
| Subject: |
and don't forget
|
|
Date:
|
7/17/2012 7:17:08 AM
|
that states offer significant tax incentives and low cost industrial bond financing, usually with interest forgiveness for up to 5 years, to bring jobs. They get that the jobs more than offset the lost property and state income taxes they offer as incentives due to the compounding effect jobs have on the economy. Something Oblamer does not get.
We are in a global economy, other countries offer US companies incentives to come for the same reason. So the higher business taxes become, the more attractive it becomes to move jobs to where the incentive are ... including other states (ie: Boeing to SC) or other countries.
Lastly our manufactures sell in other countries, just like fishy examples of car manufactures "assembling" in the US. It costs a lot to ship assembled vehicles overseas no matter which way it goes.
I do not know why fishy thinks it is all one way. That is why Oblamers argument makes no sense. It is not always the US manufacturing in other countries and it all coming back to the US. But businesses are capitalist and look out for their shareholders and will go to where they can make the most money, no matter if it is due to labor costs, benefits, healthcare, unions, shipping, taxes, freight, etc. And the same holds true for foreign manufactures coming to the US.
|
| Name: |
water_watcher
-
|
|
| Subject: |
Outsourcing is a Business Decision.
|
|
Date:
|
7/17/2012 7:20:42 AM
|
Cum sa humida (Thank you)
Not sure I spelled it right, but I spent almost 3 years traveling back and forth to Seoul for business and was on the board of a Korean manufacturer.
|
| Name: |
water_watcher
-
|
|
| Subject: |
read my post above
|
|
Date:
|
7/17/2012 7:24:03 AM
|
and maybe you will understand. They are not manufacturing here and sending the cars back. Just like our car companies building in other countries. There are many reasons manufacturing is shifted to the US or other countries, including technology capabilities as well, that I left off my list above.
|
| Name: |
GoneFishin
-
|
|
| Subject: |
Outsourcing is a Business Decision.
|
|
Date:
|
7/17/2012 11:31:59 AM
|
Why then is it good business for foreign car manufacturers to move assembly to the US to be close to the market but bad when a US company does the same?
Name: water_watcher -
Subject: Fishy tell us who is moving jobs overseas???
Date: 6/26/2012 6:57:22 AM
This is shameful to use tax payers money and then move and grow jobs in China. Since you tried to bash Bain and Romney for this using private sector dollars ... you will joing that this goes far beyond shameful using tax payers money, then go on the campain trail being critical of the private sector for not creating more jobs or moving jobs back to the US.
http://www.youtube.com/watch_popup?v=Lvl5Gan69Wo
|
| Name: |
MartiniMan
-
|
|
| Subject: |
Easy answer GF
|
|
Date:
|
7/17/2012 11:38:17 AM
|
You see GF, it is one thing for a private company to make a decision to move jobs off shore. As a consumer we can refuse to buy their product if it bothers us so much. And as an investor, we can elect not to invest in a company that does so if we find it so objectionable.
However, the Federal government takes our money at the point of a gun and we have no direct say in participating in the off shoring of jobs other than a single vote. WIth a company I can say screw you, I'm not investing in you or buying your products. The market will dictate whether this is a good thing or a bad thing. But with the government, the screw you is going in the other direction.
And that is the difference.
|
| Name: |
GoneFishin
-
|
|
| Subject: |
Easy answer GF
|
|
Date:
|
7/17/2012 12:26:45 PM
|
Are you suggesting that GM should be producing the cars for the Asian market in the US and shipping overseas since the government bailed out GM?? You and others upset with the GM bailout can continue to buy your BMWs.
|
| Name: |
MartiniMan
-
|
|
| Subject: |
Easy answer GF
|
|
Date:
|
7/17/2012 12:39:33 PM
|
First of all I don't own a BMW. I drive a used 2006 Lexus LS430 and love it.
Second of all, I think it makes perfect sense for an auto company to build the cars it sells overseas at locations closer to the customer. What never made sense to me and what I objected to from the beginning is for the US taxpayer to be forced at the point of a gun to bail out GM and their unions at the expense of legitimate bondholders and in violation of bankruptcy law. Had they not taken the federal government in as a major investor they could anything they want. But once they did then they exposed themselves to politics ala criticism for doing something like this. Take government money and you have to live with all the crap......
|
| Name: |
water_watcher
-
|
|
| Subject: |
Outsourcing is a Business Decision.
|
|
Date:
|
7/17/2012 12:49:03 PM
|
Ask Oblamer ... I do not think it is bad. I support a global economy and Oblamer is being critical of good business decisions.
|
| Name: |
water_watcher
-
|
|
| Subject: |
Easy answer GF
|
|
Date:
|
7/17/2012 12:54:37 PM
|
Yes I bought a BMW, but I will never buy a GM car again. Oblamer did not do anything special ... if fact it WAS wrong to bail them out with tax payers dollars, give 30% of the company to the unions ... and they still filed bankruptcy.
We could have saved billions by allowing the proivate sector to deal with it through a structured bankruptcy. They would have been better off than today and the unions would not have gotten 30% of the company for no valid reason. That was the ONLY reason Oblamer used tax payers dollars.
|
| Name: |
GoneFishin
-
|
|
| Subject: |
Outsourcing is a Business Decision.
|
|
Date:
|
7/17/2012 1:37:38 PM
|
Then do you or do you not support the move by GM to manufacture cars in China for the Asian market?
|
| Name: |
GoneFishin
-
|
|
| Subject: |
Hey Producer MM
|
|
Date:
|
7/17/2012 2:02:04 PM (updated 7/17/2012 2:02:58 PM)
|
I can't imagine why a producer like you would drive a 6 year old car and actually admit it on the Forum. It is producers like you who drive 6 year old clunkers who are causing the unemployment rate to remain high. Blaming it on Obama is disingenuous. Are you the typical closet conservative just waiting for the next government sponsored clunker program and hoping it includes the 2006 year model? Do you rent a new Lexus when you have to meet a client? Man, you people are helping to keep the unemployment rate high and then blaming everyone else from Obama to me.
|
| Name: |
water_watcher
-
|
|
| Subject: |
Outsourcing is a Business Decision.
|
|
Date:
|
7/17/2012 2:27:49 PM (updated 7/17/2012 2:31:59 PM)
|
You have again missed the point. I have stated my issue with GM and Oblamer. I am not opposed to any company moving manufacturing to another country ... it is Oblamer that is creating the noise about it. The point on GM is while he is throwing stones at Romney because some of the companies he saved with private equity dollars moved some jobs overseas ... Oblamer used tax payer dollars with GM and they are also moving jobs to other countries. The man talks with fork tongue.
So the point was ... Oblamer is talking about the jobs GM is creating with tax payer dollars (and he has publically talked about how many employees GM now has) ... but many of those jobs are being created in other countries using the US payers money.
If GM had used private equity or raised private capital, I personally would not have any issue with GM or where they are growing. I do have a problem with GM taking US tax payer money and using it to invest in other countries.
|
| Name: |
water_watcher
-
|
|
| Subject: |
I don't blame MM
|
|
Date:
|
7/17/2012 2:31:05 PM
|
With all the taxes Oblamer wants to implement to bring down the country as he tries to redistribute wealth to non producers, we have to save every dime. I have a 1998 Dodge pickup that I leave at the lake and love driving when I am there. I also have a 2006 VW Passatt that I use when I need to leave a car at the airport or train station.
|
| Name: |
GoneFishin
-
|
|
| Subject: |
Hey Hob Knob
|
|
Date:
|
7/17/2012 7:11:05 PM
|
WHY DO I ALWAYS SENSE THAT YOU WILL MAKE NO SENSE WHEN YOU POST ANOTHER OF YOUR YOUR TYPICAL SENSELESSS POSTS THAT AREN’T WORTH 2 CENTS?
|
| Name: |
water_watcher
-
|
|
| Subject: |
Hey Hob Knob
|
|
Date:
|
7/17/2012 7:50:33 PM
|
What? He made perfect sense. Hob, I stand corrected. Thank you.
|
| Name: |
MartiniMan
-
|
|
| Subject: |
Hey Bottom Feeding GF
|
|
Date:
|
7/17/2012 9:33:01 PM
|
I am trying to support the common working man that services my Lexus. Heck, if I replaced it every 2-3 years like you rich libtards sucking on the gov't teet I would deny them a good living. I'm just for the common man versus you left wing nuts that spend all your time hanging around in fern bars sucking down cosmopolitans and talking about how you need to to direct the lives of them poor, dumb black folk that can't think or take care of themselves. I know, it makes you feel better about yourself and that is what liberalism and progressivism is all about anyway.........and if it actually helps the little guy....why thats just an added bonus...not that it ever does.......that was just a hypothetical.....
|
| Name: |
MrHodja
-
|
|
| Subject: |
Hey Hob Knob
|
|
Date:
|
7/17/2012 10:21:34 PM
|
You choose in your own mind for them to not make sense.
Why didn't you answer my email? Afraid I might find out who you are? We have mutual acquaintences who know. Why are you so reluctant to be known? You know who I am. Do you not find it odd that you refuse to identify yourself to me?
|
| Name: |
roswellric
-
|
|
| Subject: |
Shipping costs
|
|
Date:
|
7/18/2012 11:09:48 AM
|
|
|
New Post
Search
Off-Topic Forum
Reply
»
Georgia Lakes
»
Lake Allatoona
Login
|
Home
