iPhones and Outsourcing

What does buying an iPhone have to do with choosing an outsourcing partner? Besides the fact that both relate to technology that could be core to the operation of your business, there are other important similarities. Let me explain with a story…

Recently California was charging more in tax than the price of the iPhone (story link). Absurd you say? Of course not, the law said they could. To spoil the story in the link; the law governing sales tax on a phone sold under subsidy by a carrier states that the tax is on the unsubsidized amount of the sale. So when you buy an iPhone on Black Friday in California for $49.99 you are charged tax on the full retail price of $650, bringing your tax liability to $55.25 (8.5% sales tax). I don’t imagine they mentioned that in the newspaper ad you read while eating your turkey dinner. But what does that have to do with outsourcing? Everything

Evaluating an offshore partner is like evaluating a Black Friday deal, if it’s too good to be true then it likely is. You may have seen a 40” flat screen TV for $199 but did getting that TV require you to get up at 2am and wait in line for 10 hours? Did they mention there is only 1 per store, so that guy in front of you just bought the last one? You need to know what you’re getting into. The offshore sea is full of tatics and tricks such as,

  • Hidden fees for even slight deviations from the project
  • Bait and switch of developers, leaving you with inferior talent
  • High employee turnover, greatly impacting your efficiency

At the end of the day you are entering into a partnership with your vendor. If you really want that TV and you read all the fine print and are willing to wait in line then go ahead, just make sure you make an educated decision.

Mike Sudyk
Director of Marketing
LinkedIn page

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