As we look back on the first few months of 2013 we are seeing impressive upward trending in manufacturing. The overseas supply chain is more costly then it was just a few years ago. Disruptions in this supply chain impact domestic manufacturing and cause global tensions. Customers also talk to us about product compliance and the increased regulations which when not taken into account have litigious implications.
With so many factors to calculate the cost of producing a product it is easy for company’s to be enamored with low price parts. What is ignored is analyzing the ancillary costs and figuring out the total cost calculation. With major investments in technology and automation the gains in efficiency and quality outweigh the overseas competitors. Looking forward the tickle of new re-shore manufacturing continues but without supporting industries, expertise and ultimately capacity it is going to be difficult to ramp up. Skilled workforce is going to increasingly become more and more sparse as this trend continues without investments in education and training. Luckily we do have a few tricks up our sleeves.
In 2012 40% of manufacturing companies indicated that new projects were won from previously off-shored accounts. With the life expectancy of products shrinking and iterations happening faster it has become easier to work within the local market. The weakening U.S. dollar, increased oil and labor costs strike at the hear the competitive advantage for offshore manufacturing. Local supply chain that is modernized and agile reduces the total cost for your products. With a positive trend, sound business decisions and all factors considered, manufacturing is trending back in the United States.