As China’s manufacturing becomes more sophisticated and technological innovation improves moving custom manufacturing overseas may be a prudent move now more than ever. Deciding where and how to manufacture custom products is crucial.
While many manufacturers have the potential to grow and thrive with domestic production, outsourcing may be a better fit for a particular product/business.
Going offshore is not right for all companies and every product. However, the prudent business will thoroughly investigate it as part of their due diligence. There are several benefits to outsourcing. The main advantage being lower production cost. Highlighted below are three reasons why now may be a good time to seriously consider moving custom manufacturing to China.
Motive #1 Lower Labor Cost
The US ranks 14th worldwide in manufacturing wages. By comparison, Chinese workers make less than their US counterparts. There are many stories on the web touting how much labor rates have increased in China but the fact is the labor rates in China are still much less than here in the USA. Labor savings alone could significantly reduce the cost of custom manufacturing a particular item. There are other issues to consider to be sure, but labor cost is the main reason made in China items are less expensive to manufacture.
Motive #2 Unlimited Capacity
China has a huge number of factories (estimated at about 2 million), each with its own unique specialty and expertise. Virtually all of these factories have close business relationships with specialty outsourcing factories that provide highly specialized services. The US company that contracts with the right China manufacturer not only reduces time to market, they minimize their capital outlay, and have virtually unlimited production capacity at their disposal.
Motive #3 Resource / Material Proximity
Certain resources may be more readily available in China. These resources may be factories with specific expertise or unique material resources. The material resources may very well be imported, but the bottom line is that a wide variety of resources and raw materials are available to mix and match to supply the product that the US customer needs.
How ITI Manufacturing Experts Can Help
As discussed, the US-based company that contracts with the right China manufacturer stands to benefit from all of the positive aspects custom manufacturing has to offer. On the other hand, the US-based company that contracts with the wrong China manufacturer stands to suffer all of the negative situations offshore manufacturing has to offer. Choosing where to host manufacturing operations is THE most critical decision for any business.
ITI Manufacturing is a US-based company that has deep roots in China with a keen pulse on the Chinese economy and expert knowledge and understanding on how to mitigate China manufacturing services. Depending upon your business situation and product(s) that need manufacturing we know how to choose the right China manufacturers to ensure your offshore manufacturing success. If you need assistance navigating the waters of offshore manufacturing, or if you have tried to “do it yourself” and are finding out your better at running your business than being an outsourcing expert, give ITI a call at (281) 242-7030 and experience offshore manufacturing as it should be: Hassle free.