Does Overseas Production Save You Money? Yes, BUT…
There are times when overseas production makes a lot of sense. We admit that this sounds odd coming from a plastic production company that’s located here in the United States but that statement is true. We believe that this article will give you a deeper understanding of things you should be considering when selecting an overseas production partner for your next project. Here are top five scenarios you should take into consideration.
Products that arrive in the United States ports must clear customs. In general this isn’t a difficult process but we have seen many occasions where hold up in customs caused serious delays in product arrival. As a manufacturer things are completely out of your hands once they are loaded onto a container. Containers may be tagged for full inspection (especially if they share space with other products). There may also be a delay if there is a large volume of containers to be inspected. Plus there are also labor uncertainties where either ships or dock workers may be on strike or severely under staffed. In other words if you are fine with any of these potential delays then you may be a good candidate to take advantage of overseas production.
You should always be aware of what the political climate is between different countries that are involved in your product shipment. As we have seen over the past few years, there has been a “trade war” that the United State and China are battling. Sometimes there may be issues that are out of your manufacturers hand that may put your delivery on indefinite hold. New taxes, tarrifs and quotas may go into place that may directly or indirectly delay or stop your shipment. Pay close attention to your sectors vulnerability to the overall political climate.
Product Change on the Fly
Some of the more sophisticated products may need a last minute change, or may need a modification and/or part replacement after the product has already left the manufacturer. This is rare, but it happens. Once your products are in a container on a two to six week journey on a ship you are essentially stuck. If this is a first time a product has been created and is a sophisticated product then be aware of the down time you may deal with if bugs have been discovered. Producing items in the U.S. allows us to send back the products to our east or west coast (if and when need be) and make corrections that take minimal down time.
What do you do when your first production sells fast and you are in need of a secondary run? Can you afford to wait for the next batch to be produced, packaged, shipped and go through customs? Is it really worth the small savings to go through this? The revenue lost due to the “paused” time may be considerably more than the savings you gained from producing overseas. If you are making a “freebie” you will be giving out during a conference then you already know your quota, but if you are selling a device that may have a heavy demand then you don’t want to lose any time.
Made in USA
More and more consumers prefer to purchase products that have been made here in the United States. A good plastic injection molding firm knows how to help you save money and give you a high quality product that was made in the States and supports the American economy. If you are in an industry where a lot of value is placed on this then you definitely cannot afford to produce your items overseas.
We hope that our article will help you better understand the uncertainties that lie when you select a more economical production partner who is overseas. We know that there are times when this is a good choice to make, but make sure you are comfortable with the above issues. They are unexpected and they do happen. JATCO has been working hard to give you the highest quality product at the best price and we would welcome the opportunity to chat with you about your next injection molding project.