"The purpose of this paper is to describe and explain some highlights associated with the contemporary business practice of out-sourcing more and more of a companies’ activities in the belief that doing so will increase profitability. A strong case is made that it will not always be possible to make more and more profit out of less and less product and that, worse, there is a strong risk of going out of business directly as a result of this policy. The point is made that not only is the work out-sourced; all of the profits associated with the work are out-sourced, too. The history of the former Douglas Aircraft Company is cited as a clear indication of what these policies have done – and as a warning of what more may be done. The subcontractors on the DC-10 made all of the profits; the prime manufacturer absorbed all of the over-runs. The circumstances under which out-sourcing can be beneficial are also explained. They involve better access to improved facilities with which to make more precise detail parts to reduce the cost of final assembly. A strong warning is included about the perils of sub-optimum solutions in which individual costs are minimized in isolation."