Quote Originally Posted by $tandaman View Post
What you speak of could have been true 5 years ago, when such drastic price difference was possible (but you are way off on the numbers).
Actually I'm not off at all. We currently employ several offshore designers and I know exactly what we pay them. It is of course more (in USD) than it was a year ago because of our crappy economy, but I'm quite aware of the going rates for designers in India, Phillipines, Pakistan, and a couple of Eastern European countries... and I mean the rates the designers actually get paid, not the highly inflated rates all of the middlemen charge their US customers, or the rates that the freelance designers charge American webmasters. We've also used offshore coders and I have a pretty good idea of those rates as well.

We also have a good relationship with several US-based design firms (and yes, there are many wonderful American firms with American-trained designers, which, with few exceptions, do much better work than any offshore designer I've used.) Plus, I actually know who is doing my work, whether offshore or in the US, so instead of wondering if my job is being given to the brand-new guy or the guy with the 10 years experience, I know for sure... and I can talk to that person directly, instead of going through an intermediary who translates, which often leads to miscommunication.

I'll also point out that anyone who can afford to absorb a 50% increase in costs without passing any of it on, has got to be working on enormous margin. Basic economics tells us that a 50% devaluation in currency would eat up the margin in practically any labor-based business unless the labor is being marked up hundreds of percent, which is I'm sure what the case is here.

At this point we have 25 full time in-house designers & flashers, and with some people bitching and moaning, we are doing more business then ever. People try us, and they keep coming back
There are a lot of people for whom convenience is worth a lot more than money. For those people, paying a middleman 5 or 6 times the actual labor rate may make sense if they want to avoid hassle and always have someone they can count on. The sad thing is, these same people, if they're willing to pay those rates, could easily afford an outstanding American designer with better skills and training, without having to deal with the hassles of offshore communications, time zone differences, payment via unstable services like Epassporte, and so forth.

As I said, I congratulate anyone who can market a product at such an enormous margin, be it design services, software development application software, or anything else. I don't have any problem with someone saying "We're amazing, we charge a fortune because we're worth it, and people pay it." What annoys me is when someone tells me their costs are a bazillion times higher than they actually are, and uses that as an excuse to justify the price.