| The integration of low labour cost, ex-Warsaw Pact countries into the European Union provides an unprecedented, and probably never to be repeated, opportunity to fundamentally alter your cost base.
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Analysis for other clients indicates that you can reduce your delivered conversion costs by between 30% and 50% by relocating production to Eastern European bases.
This opportunity will not last forever, because the newly integrated economies are bound to converge. But:
- the convergence will take much longer than an investment cycle (thus ensuring returns) and,
- when the convergence bites, you will be better placed to serve the growing eastern consumer base if you are located there.
This is a unique and major opportunity which needs attention now.
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