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BPO Journal

Monday, March 20, 2006

Ask the markets - the global economy is a good thing

Dell announced today that it plans to double its head count in India to 20,000 in three years. Many of the new hires would be in sales and support positions. Dell also plans to hire more Indian workers for research and development and product testing. The company is also looking for a site to establish a manufacturing plant in India. The PCs Dell sells in India today are built at its factory in Penang, Malaysia. A computer factory in India would help Dell avoid import taxes and improve its current position in the Indian PC market.

Ditto with Wal-Mart which announced its plans to hire up to 150,000 employees in China over the next five years. A response to the significant growth in Wal-Mart's international division which is growing faster than its larger U.S. operations. In 2005, the international business saw net sales and operating income rise 11.4 percent, compared to 9.4 percent for sales and 8.2 percent for operating income at the U.S. division minus Sam's Clubs.

India and China are gaining firms' attention not just as low cost service providers and manufacturers but as developing markets that fuel sales and profit growth. More and more firms are strategically building assets in these countries to improve their positions and accelerate market share gains.

And the markets only affirm firm beliefs. Dell shares rose 0.68, or 2.3%, to close at 29.76. Wal-Mart shares rose $1.07, or 2.3 percent, to close at $47.76 on the New York Stock Exchange. The global economy is a good thing.

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