Re: of "Made in America"

Postby NURB » January 24th, 2012, 10:57 pm

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Two quotes I saw today after Apple's enormous Q1 report:

1. #Apple nears incredible milestone, coming just shy of $100 billion in cash on hand. Hoard is worth more than all but 52 companies on Earth.

2. Apple's profits ($13 billion) exceeded Google's entire revenue ($10.6 billion).

You don't get that by overspending on ANYTHING.
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Re: of "Made in America"

Postby asango » January 25th, 2012, 11:02 am

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People always talk about paying double for something made in the good ol USA. But when I see record profits from a company like Apple, the first thing I think is "that is the difference between a living wage in the US and in China".

They are in essence taking the labor savings and applying it directly to their margin.

I'm also amazed (ok, maybe not amazed, how about ashamed) that we've built into our mfg jobs a ton of overhead regarding labor rights and environmental issues and then failed to export those ethics along with the jobs.

And per the earlier, if given the choice, I buy the most local thing I can. If you care about a local economy, the worst thing you can do is buy it off the 'net, much worse than some national retail corp. Amazon is a effective company, but it will be our downfall.

Re: of "Made in America"

Postby Mr-914 » January 25th, 2012, 12:57 pm

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Profit = Means of production + labor value

In other words, the profit derives from the surplus labor value: the exploitation of labor.

That's Marx in a nut shell.
Ray Jepson

"Our inventions are wont to be pretty toys, which distract our attention from serious things. They are but improved means to an unimproved end, an end which it was already but too easy to arrive at...." Thoreau

Re: of "Made in America"

Postby Coffee87 » January 26th, 2012, 8:44 am


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devonshire wrote:How many here own products made by companies that do exactly what this discussion is about? How many buy the more expensive domestic made product (if there is one)?

How many of us design products that will be replaced in a year or two?

How many folks here ditched their 3G phone for a 4G?

I used to think that if you did not employ the people who might actually buy your product, no one would be able to buy it. Yes they will. In west Michigan Electrolux left a plant in a small town. What an uproar it caused. They still sell that brand at the Mejiers and Wal-Mart, so locals are still buying them.

Curtis-Mathis was the last US TV manufacturer, high quality sets, no one bought them, instead we all bought the inexpensive TV.

Although I would rather have everything made here in the US, so every penny stays in the US, I am the minority. People want the new cheap thing, big companies know it, and do whatever they can to get your money out of your pocket, because they know the 99% wants the latest thing, and could care less where it is made.

Design departments exist to fulfill that end need. We are promoting all the things we see wrong, except in rare cases.
We recognize the problem, what would you suggest is done? Will you make that first step? No new computer until yours actually burns out? Fewer software upgrades? A phone that is more than 3 years old? One pair of shoes for all seasons? No toys for your pets? The less you buy from those companies and the more you buy from the US companies is the only thing that will change the market.

I doubt China will turn away all the money of the offshore markets, they will always go where the money goes.

Perhaps Made in America actually means made here, to a specific design principle, for a specific reason.

Nothing wrong with that.


Many people will gladly pay high price for products made in USA/Europe if those products carry a famous brand name and values. Take Ferrari for example, a recession-proof company that actually has to limit production to maintain brand status.

I know this example was from a niche market, but this might actually be the way to go for US and EU based companys.
Like someone said earlier, 200 factories with 100 employees each instead of 1 megafactory with 10k staff.

Trying to compete with Asia in mainstream markets where number one USP is price is nonsense.

Apple just combines both elements. Hipster design savy approach combined with cheap mass production.
There are other cheaper alternatives out there but they have still managed to achieve incredible success.

Re: of "Made in America"

Postby Scott Bennett » January 30th, 2012, 2:35 pm

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Imagine if Apple spent a paltry 5-10% of their gigantic cash horde on building a completely automated factory in the US. Intel spends about $4 billion on a chip factory, and a decent sized car factory is less than a billion. For $10 billion, you could build something epic.

Imagine what an advantage that would give them in terms of brand image, unique manufacturing capabilities that their competitors couldn't access, time to market, secrecy, and everything else. For even less money, they could try it as a pilot project with a smaller, less critical product like the iPod or AppleTV. Maybe it works, maybe it doesn't. Even building a couple million iPod Shuffles in the US would give them a huge PR boost.

What the hell else are they going to do with all that money? For how much "vision" they are credited with having, they sure seem very shortsighted sometimes.

Re: of "Made in America"

Postby NURB » January 30th, 2012, 4:14 pm

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That's a great point, Scott. Just read an article today about Apple's investors (the one's with some clout anyway) asking what they plan on doing with that bundle of $100billion. The answer was investing. And investing in production.

The article alluded to them purchasing critical components for years, rather than investing in their own factories. The comparison was Airline Fuel hedging, where you pay 2008 prices for 2012 fuels. They would do this with chips and other critical components.

Obviously, your idea, Scott, is much better than that.
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Re: of "Made in America"

Postby Mr-914 » January 31st, 2012, 8:03 am

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Tim Cook (CEO Apple) is a logistics specialist, so I completely understand why Apple wants to invest in parts sourcing. I don't know if Scott's idea is better, but it is more creative and interesting.

One problem that I see in setting up a $10 billion factory in the US is who do you hire to work there? The US has less and less experienced and up to date manufacturing specialists. A huge factory would require a lot of engineering know-how. A smaller factory would gain some good press though. Albeit, has this recent bad press hurt Apple yet? It doesn't seem so.
Ray Jepson

"Our inventions are wont to be pretty toys, which distract our attention from serious things. They are but improved means to an unimproved end, an end which it was already but too easy to arrive at...." Thoreau

Re: of "Made in America"

Postby Scott Bennett » January 31st, 2012, 10:15 am

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Mr-914 wrote:One problem that I see in setting up a $10 billion factory in the US is who do you hire to work there?


One man and a dog. The man's job is to feed the dog, and the dog's job is to make sure the man doesn't touch anything. We all know where manufacturing is heading- it's getting harder to find Chinese subsistence farmers to do repetitive, dangerous work. As labor is getting more expensive, automation is getting cheaper. Once everything is automated, it won't matter where you put your factory. I'd be curious to know how many people work in one of those Intel chip fabs. A couple hundred maybe?

The US has less and less experienced and up to date manufacturing specialists. A huge factory would require a lot of engineering know-how.


This is a good point. The easy answer: the Taiwanese can do it. Most of the biggest and best Chinese factories are actually Taiwanese owned and run, because they were the ones who went there after costs got too high in Taiwan in the late 80s/early 90s. As China has become more expensive, a lot of them have moved on to Vietnam. Now that Vietnam is getting expensive, they are looking for the next place. I know in furniture at least, some of them are kicking around the idea of opening factories in the US.

Albeit, has this recent bad press hurt Apple yet? It doesn't seem so.


It could go either way. The NYT and TAL stories are only a week or two old, and I think there are a lot more coming. The people who made Apple into a "cool" brand aren't likely to shrug this off if it gets reported more and more. Now that Apple is the biggest company in the world, they aren't the scrappy underdog going up against Microsoft. And of course Jobs is gone. It isn't hard to imagine them being seen as evil pretty quickly.

Re: of "Made in America"

Postby jada » January 31st, 2012, 10:44 am


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As long as all (most of) the vital components in electronics are made in Asia I don't think setting up a factory anywhere else would make much sense. As pointed out by others, it's not just about cost of labour and worker's rights (also a cost in the end). If it's just to be able to put "Made in the USA" on it, remember that although this might be a selling point in parts of USA, the rest of world probably couldn't care less. (I might have read you wrong here, but I didn't get the feeling it was about creating jobs in the US)
What exactly is the ‘look of buttermilk’ and why should I want it?

Re: of "Made in America"

Postby Mr-914 » January 31st, 2012, 4:11 pm

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Scott: Apple has been criticized for it's Chinese work force for at least two years. There was the Foxconn suicides in 2010. A few months ago, there was a iPhone game put out by the Yes Men talking about all of the third world exploitation involved in technology products. I think anyone who really cared, knew for years now.
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Re: of "Made in America"

Postby Scott Bennett » January 31st, 2012, 6:12 pm

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People like us knew about the Foxconn suicides at the time, but I know my wife wasn't aware of any of that until this week (she just doesn't read tech news). You're probably right though, most people really don't care.

Jada- component availability is definitely the fatal flaw in doing something like this. I still think you could make it work with something simple like an iPod, and grow it from there. That supplier base didn't pop up in Asia fully formed, it happened over years. It would take the same to get it back.

And I disagree about country of origin only mattering in the US. I think it would be an advantage in Europe, and ironically, a bigger advantage in Asia. Chinese people don't even trust Chinese made goods now. It's not ultimately about having a sales advantage though. This is just a crazy way of doing business. There's no way the outsource-all-consumer-electronics-to-Foxconn model can survive long term. It is totally dependent on a resource (poor & desperate Chinese people) that is going to evaporate eventually.

Re: of "Made in America"

Postby sanjy009 » February 1st, 2012, 12:04 am

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Two long reads from Forbes, but worth it:

"Why Amazon Can't Make A Kindle In the USA"

and

"The Dumbest Idea In The World: Maximizing Shareholder Value"

basically, manufacturing issues are management issues, caused by trying to game the system and short-sightedness.

Great analogy:

“Imagine an NFL coach,” writes Roger Martin, Dean of the Rotman School of Management at the University of Toronto, in his important new book, Fixing the Game, “holding a press conference on Wednesday to announce that he predicts a win by 9 points on Sunday, and that bettors should recognize that the current spread of 6 points is too low. Or picture the team’s quarterback standing up in the postgame press conference and apologizing for having only won by 3 points when the final betting spread was 9 points in his team’s favor. While it’s laughable to imagine coaches or quarterbacks doing so, CEOs are expected to do both of these things.”

Imagine also, to extrapolate Martin’s analogy, that the coach and his top assistants were hugely compensated, not on whether they won games, but rather by whether they covered the point spread. If they beat the point spread, they would receive massive bonuses. But if they missed covering the point spread a couple of times, the salary cap of the team could be cut and key players would have to be released, regardless of whether the team won or lost its games.


(fits into this discussion as well)

Re: of "Made in America"

Postby Mr-914 » February 1st, 2012, 8:10 am

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Scott: Agreed. My brother moved to Thailand last year. He's a big fan of gyms. In Orlando, FL, the gym was half filled with weights from China that were crappy. My brother hasn't found a gym in Thailand without US made weights. It's weird, but I think "Made in the USA" means more to foreigners than to Americans...
Ray Jepson

"Our inventions are wont to be pretty toys, which distract our attention from serious things. They are but improved means to an unimproved end, an end which it was already but too easy to arrive at...." Thoreau

Re: of "Made in America"

Postby Coffee87 » February 1st, 2012, 9:17 am


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I think the average consumer could care less about the country of origin.
If the product is cheap, people only really care about the price.
If the product is expensive, people only care about the brand image (status symbol).

*this is of course about mainstream market and a big generalization and there are markets and communities where other stuff matters.

Re: of "Made in America"

Postby Scott Bennett » December 6th, 2012, 1:42 pm

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Apple is bringing Mac production back to the US.

http://gizmodo.com/5966177/tim-cook-to- ... us-in-2013

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