The credit crunch has dominated the headlines throughout 2008 but for procurement a crunch of another kind could be just around the corner.

A recent survey by consultancy firm, the Everest Group, has found that a ‘talent crunch’ in India’s seven major outsourcing locations – Bangalore, NCR, Mumbai, Pune, Chennai, Hyderabad and Kolkata – is forcing a rethink in the BPO industry.

And as the talent pool in these cities shrinks (at the same rate that costs increase), it seems that more and more firms will be moving out to the business equivalent of the suburbs.

"It is difficult to sustain the growth in Tier I cities because of the rising real estate prices and talent crunch. There is no option but to move to Tier II cities," Everest Group's Country Head (India) Gaurav Gupta said.

 "Movement to lower-cost cities within India is likely to result in additional 15-30 per cent reduction in operating cost despite lower employability and higher management costs," Head of Global Services at Everest Research Institute, Nikhil Rajpal, said.

The shift away from India’s traditional BPO hubs towards places such as Jaipur, appears inevitable, and these new ‘low cost cities’, could do much to alleviate the increasing issue of talent shortages.

How long it will take them to get up to speed remains to be seen but, if you were thinking of investing in a map, now might be a good time to get one.