As manufacturing continues to make a comeback in the U.S., more and more companies are rethinking why they continue to have a portion, or all, of their manufacturing overseas. As business continues to evolve into a customer-driven, produce-on-demand product offering with many options, these companies are looking to reduce their investment in inventory and still meet the growing need for customization. A solution that is gaining in popularity these days is to find a local, or at least U.S.-based, vendor/supplier that can support their needs.
A not-for-profit group, Reshoring Initiative, was established to help provide support, including case studies and a total cost calculator (TCO), for companies debating between bringing production back to the U.S. or leaving it overseas. The TCO tool is especially useful as it allows each company to understand the total cost of having their product manufactured and shipped from overseas.
As manufacturers and distributors today are realizing that with overseas price increases, continued quality issues and a lack of intellectual property protection, they should consider taking another hard look at whether there is any real benefit to offshoring production. Using the TCO tool provides a good opportunity to understand the total cost of offshoring –and then, if applicable – finding a U.S.-based source or manufacturer.
By necessity, companies have become more efficient over the past several years and are finding more internal capacity for production, often with technology improvements, process changes or investment in equipment. Finding the right vendors and suppliers is just another key component of this process, allowing these manufacturers to bring more and more offshore production back home and further supporting the U.S. economy.
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