The move to reshore manufacturing to the United States has become increasingly more common in recent years. Now, it’s even more popular due to the coronavirus pandemic. Covid-19 has caused supply chain disruptions throughout the globe which have impacted countries that rely so heavily on imports–especially the U.S.
Without necessary components and materials like face masks, ventilators, and even toilet paper during the pandemic, Americans have come to realize how important it is to have our own source of domestic supplies. Now that we realize why reshoring is so important for the health of our nation, many Americans wonder how it will be possible.
While it’s a complex question, the answer can be summed up simply: self sufficiency.
Manufacturers who want to reshore production need to focus on their resilience and make sure they have the necessary skilled workers and tools to remain self sufficient.
Here are some important steps that manufacturers should take when committing to become more self sufficient.
Apprenticeship Programs and Training
A huge reason that the U.S. has fallen behind in manufacturing is the skills gap. There are plenty of people preparing to enter white collar jobs, but not enough willing to work those skilled craftsmen blue collar jobs that are still very necessary.
A recent Brookings study showed 67% of jobs require some postsecondary education or training, not necessarily a 4-year college degree. The most promising education for learners and the U.S. economy is job-focused postsecondary education and apprenticeships.
Apprenticeships would build the national talent pipeline and give younger generations the information and skills they need to compete in an economy that appears to favor white collar jobs.
On that same note, many manufacturers struggle in the U.S. because they only offer part of a service or product as opposed to overseas companies that can do it all. An important component to making it as a manufacturer in America is developing a broader scope of your industry.
The reason Chinese manufacturers are so successful is because they take a certain product and manufacture it from start to finish. The only way the U.S. can compete is to create a larger, more skilled workforce with industrial engineers and toolmakers that are flexible.
Investment in Technology
Technology is everything in this day and age. From manufacturing, to transportation, to marketing, a good business needs to stay up-to-date on emerging technology.
Consistent investment in equipment and technology, even in tough times like today, will drive competitiveness and productivity. Investing much less than our offshore competitors hinders U.S. manufacturers’ long-term growth and the growth of the U.S. economy as a whole.
A major player in manufacturers’ decision to reshore involves the favorability of products that are “made in USA”.
Once you’re making a product domestically, you have to capitalize on every detail of it–the production process, the environmental standards it’s held to, the quick turnaround and low transportation costs–there are plenty of benefits to buying American made that businesses can market to their audience.
The good news is that people want American made. A 2017 Associated Press-GFK poll found nearly 75 percent of Americans prefer to purchase American-made goods.
Quality, morality, and economic impact are amazing reasons to motivate buyers to purchase your American made product.
Even when you find yourself competing with a lower priced offshore product, the customer can compare the TCO of your offer vs. the lower priced offshore offer–most often, the American made product wins out. Contract manufacturers can use the Total Cost of Ownership Estimator® (TCO) to make a strong case when selling against offshore competitors.
All-in-all, although it’s a tough transition, reshoring will improve the quality and reputation of your brand tenfold.
For more information, visit www.reshorenow.org.