Local Sourcing

A long time ago there was a mass exodus of manufacturing from the US and many companies have been sending their orders for products to be made abroad. This has become the norm for businesses, especially using Asian vendors to get their products made. At the time, this would seem like a great way to save money and still get a good product made. Factories in places like China would jump at the chance to get into the US markets so it was a win-win situation. And international factories would use a trusted freight forwarder to ship their products to the US. Now, years later the world market has been established and many companies are beginning to look for a change once again. This change is slowly becoming a move back to the US for manufacturing.

Manufacturing does not have to be one or the other in order to work, but retailers are finding that there is more of a demand for local products than there once was. Costs can be a factor too. It was once true that an average worker’s wages in Asia were so much lower that it would offset the international logistics costs. In the end it would still be much cheaper than manufacturing locally. This is no longer always the case. While wages are still less in other countries, they are getting higher and ocean freight shipping rates are becoming higher as well. This means that the overall cost to manufacture abroad is getting closer to manufacturing domestically. Comparing the costs as well as the ship window has brought more companies back to the US. This can be a great asset for the US while the economy bounces back. The more jobs that are brought back to the US, the more growth we will see.