Wired: Made in America: Small Businesses Buck the Offshoring Trend

Looks like the pendulum is starting to swing the other way. In the recent Wired issue 19.03, Brendan I. Koerner takes a look at how smaller business are beginning to shift their attention away from Asian manufacturing and back to the good ol’ US of A for its manufacturing. With the emergence of a new middle class in China, the promise of cheap labor and ridiculously low tooling and part costs has dissolved into issues of poor, inconsistent quality and logistics headaches. For many companies, the cost-benefit is there to offset the risks:

One big reason for this growing dissatisfaction is quality. Like Sleek Audio, countless US firms have received long-awaited shipments only to discover that the products are too flawed to sell.

In addition to quality issues, the on-going problem of protecting intellectual property has been made worse as over-booked manufactures shunt smaller programs off to secondary manufacturers, exposing them to more opportunities to get ripped off.

All of this adds up to many companies deciding that, when taking into account the risks, the net advantage is no longer in Asia. Even if a product costs a few more cents domestically, troubleshooting requires a short flight or drive as opposed to 24 hours of transport to the other side of the world.

Now, let’s hope that all those North American manufacturers that went out of business half a decade ago didn’t kill the domestic brain trust of experts required to bring that business back home.

[Wired article]

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2 Responses to “Wired: Made in America: Small Businesses Buck the Offshoring Trend”


  1. 1 Kevin Shankwiler March 24, 2011 at 2:07 pm

    Warren-

    Good post. I read the same article and am encouraged to see more US firms bringing production back onshore. The hidden costs of troubleshooting (as the article points out), travel, QC, communication, etc. are beginning to be better understood vs. cheap production labor. Even large organizations, like GE Appliance, are bringing production back to the US.

    While cheap labor will still be an attraction to overseas manufacturing, I believe America’s competitive advantage in the near future will be in strategic, flexible and local-oriented manufacturing schemes. And there’s a lot of opportunity for design there…

    • 2 Warren Ginn March 24, 2011 at 5:22 pm

      I sure hope so, Kevin. I sent this article to several clients and one of them was currently in China trying to sort out another snafu. He said that this has been something he and his team had been discussing for a while. My only hope is that when they do come back, there will still be enough expertise here in the US to take on all that new work. Many of those shops that were shut down due to the loss of business aren’t going to just come back to life overnight.

      But yes, I think this is good news for the design community here in the US.

      Thanks for posting.

      ~w~


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