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A trade meritocracy
- By Tim Heston
- December 16, 2013
Here’s the kicker: This was just the piece-part price. It didn’t include the added inventory expenses, shipping time, and all the extra risk that comes from working with a faraway supplier (risks spelled out by Harry Moser’s Reshore Now organization). The savings came through simpler tooling, innovative heat treating, better blank shape for downstream forming—basically, smart design choices, combined with an unusual mix of machinery that gives the operation a competitive advantage (to be covered in an upcoming issue of The FABRICATOR magazine).
This week Joshua Kurlantzick of BusinessWeek wrote a column about the fact that, for the first time in decades, growth in free trade isn’t outpacing world economic growth. The column goes on to describe the fallacies of protectionist barriers—all true.
But one of the things he doesn’t mention is the inherent inefficiencies of long supply chains for various products. A global supply chain may not be an agile supply chain.
As Harry Moser has mused many times in recent years, it often makes sense to source locally to maintain quick response and flexibility. If a product has sufficiently high volumes and global demand, it may make sense to open factories (and a cluster of suppliers) close to the consumer, be it in the U.S., China, or anywhere else. For low volumes or large machines requiring massive capital equipment investment to make them, such as mining equipment, it may make sense to make in one place, then ship globally.
Put another way, free trade shouldn’t mean companies need to source globally. They should instead simply source where it makes business sense to do so.
Despite the reshoring trend, stateside manufacturers these days—including Robertson—still fight the perception that overseas is cheaper. It all comes down to price, and now, some of the best stateside manufacturers are giving the best prices. The best part: They may be just down the road, not halfway around the world.
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The Fabricator is North America's leading magazine for the metal forming and fabricating industry. The magazine delivers the news, technical articles, and case histories that enable fabricators to do their jobs more efficiently. The Fabricator has served the industry since 1970.
start your free subscriptionAbout the Author
Tim Heston
2135 Point Blvd
Elgin, IL 60123
815-381-1314
Tim Heston, The Fabricator's senior editor, has covered the metal fabrication industry since 1998, starting his career at the American Welding Society's Welding Journal. Since then he has covered the full range of metal fabrication processes, from stamping, bending, and cutting to grinding and polishing. He joined The Fabricator's staff in October 2007.
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After Ludlow Manufacturing Inc. (LMI) received The Fabricator's 2024 Industry Award, Todd Ludlow, founder and president of the...
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