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Manufacturing Is Officially Coming Home

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Rob Spiegel
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Re: MANUFACTURING COMING HOME
Rob Spiegel   12/30/2013 9:39:42 AM
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Good point on quality Bobjengr. We've seen tons and tons of items in Made by Monkeys that would indicate there has been a sharp quality drop-off with American products since manufacturing shipped to Asia. It may be anecdotal as we see the complaints flow in, but I'll bet that represents a quantifiable drop.

bobjengr
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MANUFACTURING COMING HOME
bobjengr   12/24/2013 12:10:06 PM
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Excellent Post Rob.  I can certainly attest to the fact that time zones present a big problem.  I retired from GE (Appliances).  At that time, GE contracted with Satyam in India for all drafting and CAD work.  It was a real pain for the "state-side" guys.  We would start our communication meeting at 0600 hrs Eastern Time, just as they were leaving for the day.  For me, that would mean leaving at 0515 in the morning to make the meeting on time.  This really gets old in a heartbeat.  Also, I don't want to be overly negative but, Satyam was not all that good because they simply did not understand American cooking products.  India just does not cook like we do.  The dishes are definitely different.  We really struggled with this one.

 I have one client that buys several products from China.   Quality is questionable and you really never know if the product shipped will provide yields necessary to fulfill production demands.   The very best company gives us an 82% yield.  There is a 15% "over-purchase" knowing a significant percentage will be off-quality.  This, to me, is completely unacceptable but the management is locked in to contracts that (apparently) can't be broken.  

 There is a great deal to be gained for bringing it home.

Rob Spiegel
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Re: On Shoring Trend
Rob Spiegel   12/9/2013 12:23:57 PM
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Debera, I was surprised when I found the time zones were an issue. But it makes sense. We're human. These executives didn't realize they would end up on the phone with their contract manufacturer every night.

Debera Harward
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Re: On Shoring Trend
Debera Harward   12/9/2013 6:02:26 AM
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Other than wages there are certain other reasons of manufacturing moving towards US . For the first  time economic drivers have created competitive advantage for US. Some are mentioned below ;

1. Cheap and large quantity of natural Gas

2.Innovation. In US the innovation rate is much higher than any other country maximum R&D is being done there .

3.Time Horizon Issues

4. Less wages

5.Mergers And Acquisitions

And many more .

Debera Harward
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Re: On Shoring Trend
Debera Harward   12/9/2013 5:51:40 AM
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@Rob, Yes working in different time zone is also a very important factor .I can understand the pain of working or staying in touch with the client during the night times thorugh different modes of communication. It totally disturbes your life , routine etc .

Rob Spiegel
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Re: On Shoring Trend
Rob Spiegel   12/5/2013 11:13:37 AM
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Good point Chuck. There are a lot of reasons to move manufacturing back to North America. I talked with an American executive in the electronics industry who moved manufacturing from China to Mexico so he could be in the same time zone. He hadn't anticipated spending every night on the phone with his contract manufacturer. 

Debera Harward
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Re: On Shoring Trend
Debera Harward   12/4/2013 7:17:29 AM
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US has lost its manufacturing skills to China, Bangladesh and other less developed Countries like India, Brazil . US has been accused of becooming a service community. However there are certain companies that have started supporting manufacturing some products in US. I have heard somewhere that president of Wallmart US is planning  to manufacture goods in US it would create jobs nd will boost the economy and the national pride.

Debera Harward
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Re: On Shoring Trend
Debera Harward   12/4/2013 5:39:50 AM
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Its really great that manufacturing is again comming back to US, i dont think that employees over there are not capable enough however in the past the wages in China , Bangladesh etc were less as compared to US but now there has been increase in wages and transportation cost has also rised so there is no advantage of placing the industry in Areas other than US.

Charles Murray
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Re: On Shoring Trend
Charles Murray   12/3/2013 6:45:56 PM
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Great article, Rob. I particularly like it because it shows that manufacturers of small items -- in particular, electronics -- are staying home. For a couple of years, we've been hearing that makers of big products (cars, trucks) lose their overseas cost advantages when it comes time to ship their big products back to the U.S. This shows that there are advantages to manufacturing here, even if you build small things.  

NadineJ
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Re: On Shoring Trend
NadineJ   11/29/2013 5:40:06 PM
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It's not the learning curve that I question.  I think that if the real problem isn't address, the opportunity to learn viable skills won't be present for years.

The possible delay I see is from U/S manufacturers acting like the proverbial ostrich and just sticking their heads in the sand.  Or even worse, using the excuse of lack of affordable skills in the U.S. to go or stay off-shore.

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