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The future of manufacturing & offshoring?

Tech website Ars Technica has a great article about the offshoring of manufacturing.  The article, titled Made in America: small businesses buck the offshoring trend, is specifically about tech companies, but can certainly apply to any company (e.g. pretty much every R/C company on the planet) that has sent their manufacturing to China and other nations over the last couple of decades.  The article delves into why some companies are starting to consider the cheap labor costs overseas as a liability rather than a benefit and what they’re doing about it. For some that means bringing manufacturing back to their homeland and taking a cut in their profits, while others are looking to more automation and robotics as the answer, to remove human fallibility from the equation.  Here’s a snip from the opening:

As he whiled away the airborne hours, Krywko made a mental list of all the manufacturing glitches that had nearly wrecked his company. There was the entire shipment of 10,000 earphones that Sleek Audio had to discard because they were improperly welded, a mistake that cost the company millions. Then there were the delivery delays caused by the factory’s lackadaisical approach to deadlines, which forced the Krywkos to spend a fortune air-freighting products to the US. Even when orders were produced on schedule, Krywko wasn’t too pleased with the situation: The company always had precious cash tied up in inventory that took months to arrive after the prototypes had been approved.

The headaches had finally become too exasperating to bear. And so, on that flight, he turned to Jason and said that he was done with Dongguan. “I can’t do it anymore,” he said. “Let’s bring it home.”

It is a well researched and documented article that deserves to be read in it’s entirety.

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Posted by in Industry News on Wednesday, March 9th, 2011 at 12:36 pm

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