New Growth Expected in US Manufacturing Industry
Written by Exequiel Bertaina, Vice-Managing Editor
American manufacturing is the sustainable answer to local demand. According to a survey released by the Boston Consulting Group, 1/3 of US manufacturing companies are planning to bring production back to the US. Says Paul Crawley, President of NetReturn which covers all aspects of the supply chain in the US, “we felt that it would be best to do [it] here in the U.S. and not only from [just a manufacturing] perspective but from an economic one too. It’s been wonderful.”
Manufacturing Overseas is Not What it Seems
Start-up companies are led to believe that it’s best to offshore production, but this is misleading advice. Local production allows firms to achieve a higher turnaround time at a lower transportation cost. There is also reduced risk because the firms are able to order lower quantities of each good. Let’s not forget that the American automobile industry needed to be bailed out because companies like GM and Ford relied too heavily on off-shore manufacturing.
Adjusting Consumer Perception
Consumers should not forget that production involves everything from the supplier of raw materials to the truck driver that transports products to the store. Off-shoring production completely cuts away all of these jobs and thus cripples the economy.
Harnessing the Web Revolution
What’s great about the internet is that a product which costs $2 to produce can be sold at $3 on the internet instead of $4 dollars in retail. Not only is the product of premium quality and produced locally, but it can better compete with foreign products with lower prices.
Will the trend of producing locally continue to thrive in America? Only time will tell.
- Arbitrage Magazine Exclusive Interview with Paul Crawley, President of NetReturn
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