The practice of offshore manufacturing is widespread across many industries – especially consumer goods, and for good reason. Manufacturing in countries like Asia allows businesses to access the necessary equipment, materials, and expertise which either don’t exist or are cost-prohibitive in the United States.
However, some products are naturally more suited to offshore manufacturing than domestic manufacturing. Manufacturers also typically produce these products in high quantities and/or have a high labor ratio to manufacture and assemble. Manufacturing such products in the U.S. would be costly which would potentially price the product out of the market for many consumers.
This article highlights some of the characteristics of ideal products that companies should consider for manufacturing offshore.
The Best Products for Offshore Manufacturing
Companies in every industry manufacture their products overseas. That being said, some products are more suited to offshore manufacturing based on their characteristics. The best products for this business strategy are the ones which:
Need Specialized Facilities or Materials
China and other Asian countries have an intensely robust manufacturing infrastructure capable of handling a widely diverse array of manufacturing needs. Infrastructure such as this would be very expensive to develop from the ground up in the United States. Companies find it expedient and cost-effective to turn to professionals who have already developed the tools and techniques necessary.
Require Production in Mass Quantities
Chinese manufacturing is all about quantity. The largest plants and machines can produce a large number of a specific item rapidly. Smaller quantities don’t offer as much of a bargain in China as many good factories are geared for larger quantities. Also, the production of smaller quantities doesn’t offer cost-effective benefits for many reasons. One reason is the Chinese factory’s material suppliers sell materials to the factories in large quantities. Smaller quantities of custom items are often better suited to domestic manufacturing where a business can take advantage of smaller machine runs and the factories have more raw material choices from which to choose.
Have Clear, Distinct Specifications
The best items for overseas manufacturing (any manufacturing actually) have clear, complete specifications. This is particularly important when attempting to communicate with people several thousand miles away who have a different language and culture. Poorly defined specifications greatly increase the chances of miscommunication and enhance confusion. For example, electronics are a prime candidate for outsourced production. Offshore factories can clearly define electronic products because companies do a great job of providing conceptual details and product specifications. Also, they usually order production in large bulk quantities.
Are Efficient and Easier to Transport
Each year, some 11 billion tons of consumer goods come across the ocean en route from manufacturers to businesses. The containers are carrying everything from vehicles to plastics – items that are not delicate and will survive transportation in freight. That’s not to say more sensitive goods cannot make the trip but greater cate and more expensive packaging must be considered for those items.
Goods Considered to Be a Necessary Item for Life
When it comes to manufacturing medical instruments and pharmaceuticals, many companies still choose outsourcing. This is due to the extra expense of domestic manufacturing. Also, this allows companies to leverage the cost-savings of outsourced manufacturing to help keep prices low.
ITI Helps Companies with Outsource Manufacturing
Offshore manufacturing is a viable business strategy that delivers significant benefits. By allowing companies to produce high quality, specialized goods less expensively, companies can pass on savings to customers and remain competitive in their market of choice. For 45 years ITI Manufacturing has been empowering US-based companies to operate with the best offshore manufacturing resources. What we’ve done for others, we can also do for you!
Contact one of our expert manufacturing liaisons today at (281) 242-7030 for information or to request a free no-obligation quote. As an added convenience freely take a moment online to discover if overseas manufacturing is right for your product today.
