Four Advantages of Manufacturing in the United States

Choosing a manufacturer takes more than business sense. Saving on parts and labor matters, but other factors weigh more than cost. Decades ago, moving production from the United States to Mexico or China looked like a sound way to save on production and materials.

That decision carries more risk now. Cheaply made products can be too flawed to sell, and communicating and traveling across an ocean is much harder than working with a manufacturer a few hours away. Whatever an overseas manufacturer saves on labor and materials, the case for manufacturing in the United States often outweighs it.

Convenience and On-Time Delivery

A specialized product depends on reliability, on-time delivery and dependable order turnaround. Sending flawed products to your own customers is money thrown away, and a cheaply made product often ends up costing more over its life.

Products made overseas also have to ship back to the United States, which takes weeks, and any delay in manufacturing can stretch those weeks into months. One LED products company waited 60 to 90 days for each shipment before it moved its builds to Kodiak in Austin.

Quality and Labor Standards

Manufacturers in the United States work under federal labor law, from the wage and overtime rules of the Fair Labor Standards Act to OSHA’s workplace safety standards. Those rules support decent working conditions, and decent working conditions support the quality of what gets built. In some countries, factory workers are overworked and underpaid, and poor working conditions tend to show up as poorer products.

Building in the United States also invests in the U.S. labor market and economy, supporting permanent jobs at home. That matters most to a business that is itself based in the United States. The same reasoning applies to Austin tech companies choosing an electronic assembly partner close to home.

Intellectual Property Protection

IP exposure from offshore manufacturing is real. Some overseas manufacturers ignore intellectual property rights, and a design can be copied, rebuilt and sold back into your own market. Manufacturers in the United States typically work under strict IP protections, so a specialized product is much harder to copy.

Even where protections exist on paper, language barriers can leave contract terms and negotiations unclear to both sides, including what a manufacturer may and may not do with a design.

The cost is large. In its 2013 report, the IP Commission, formally the Commission on the Theft of American Intellectual Property, estimated that annual losses to the U.S. economy from international IP theft were likely over $300 billion, and put China’s share of the problem at between 50% and 80%. Innovation is what keeps U.S. companies competitive, and it is hard to protect overseas.

Buyers Value Products Built in the United States

Many consumers prefer to buy locally, and where a product is built can be part of what sells it. Given the choice between a product made in the United States and an identical import, 78% of Americans would rather buy the one made at home, a Consumer Reports survey found in 2013, so that origin can be a strong marketing point for a specialized product.

A product built at home also signals jobs and economic growth in the buyer’s own economy, and the labor and quality standards behind it give buyers confidence in it.

Choosing an overseas manufacturer puts both your money and your ideas at risk. When problems come up far from your own operations, fixing them takes your own time, and sometimes a passport. A manufacturer in the United States removes the language barriers and communication problems, and keeps your designs closer to home.

Kodiak Assembly Solutions provides electronics manufacturing services from Austin, Texas, for OEMs across a range of markets, so a customer’s design, its production and the team answering questions about it all stay in the United States.