Offshoring: Necessity, not Choice

No one enjoys offshoring. It involves inconvenient change, can be challenging to manage and has a number of inherent risks. Nevertheless, the competitive advantages gained in the form of cost-savings and increased productivity cannot be ignored.

Let's imagine two identical competing plaintiff's law firms, each with $2.5 Million in annual revenues, $2.0 Million in expenses, including a marketing budget of $225,000.

Now, envision this: one firm saves $200,000 a year in operating expenses by offshoring redundant legal support functions, as well as some document production and research. They reallocate the entire amount to marketing. This firm now has a $425,000 annual marketing budget.

Normally, the firm would dedicate 20% of the marketing budget to online marketing ($85,000 of the new budget of $425,000). The firm has also offshored part of its online marketing efforts, so instead of spending $85,000, they are now spending $40,000 for the same results. The firm chooses to reinvest the $45,000 in savings and more than double its online marketing investment. The end result is the marketing budget equivalent of $470,000, versus the original $225,000 budget.

Offshoring is here. Your competition is hoping you find it too inconvenient to act.