Designing for Manufacturability – Part 5: Manufacturing Location
Fifteen or twenty years ago, things were a lot different. The world was a lot smaller. Manufacturing offshore was a very foreign thing (no pun intended). The USA was the leader in manufacturing. However, the economy began to change, and manufacturing has continued to shift.
Today we are more of a consumer and service economy, rather than a manufacturing economy. Low cost regions of the world have developed. For instance, China has become a powerhouse for a variety of reasons:
- Their cost to manufacture is lower
- Their manufacturing speed is faster
- Their material availability is becoming better and better
- And their personnel and resources are extensive
Concurrently, there are also reasons individuals prefer to do business in the United States. Manufacturing in the US means faster shipping, similar time zones, and no tariffs or import/export duties.
Panova real world example: Back when Panova had a tool & die shop within our facility, we had a client with a new product that needed it very quickly. The Panova team immediately began working with our offshore partners. In the meantime, the manager in our US shop decided he would also build the tool. Ten days later, we had FA samples from our offshore partner in our hand. They were the right color and right dimensions and a full report was provided. The parts were ready to be delivered to the client. When speaking to our tool manager in our shop, he informed us that he was done with the tool design, but he still did not have the steel to begin building the tool.
As with all things, both locations have pros and cons and it is up to each company to do what is best for their business.
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