This might be an odd question but it is one that I hope there is an answer for.
I am very curious to see if there are any innovative, creative manufacturers who has been able to compete cost-wise with overseas manufacturers for manufacturing and assembly (all in one package).
I’m thinking perhaps a jail employment program or something along the lines of American Apparel…stuff made in North America (Canada and US) that is not outrageously priced. I have also heard about a jail in Maryland that has a huge, high-tech wood and metal shop that can make really good quality furniture at excellent prices.
I am working in the consumer product area and specifically looking for contacts capable of small appliance manufacturing…
I don’t think you need to go to the extreme of using jail labor to find competitive labor.
I work for a Chinese company and we’ve discovered that we needed to bring some products back to the US because the freight was too high for a low cost, high cube product. We use an injection molder in New Jersey instead of our factory in Shenzhen!!
I’m not saying your product falls into this business model, my point is each product category has it’s own unique demands and the lowest cost manufacturing location needs to be determined using multiple criteria, not just labor. You may find the reject rate may be high in a prison community, which changes the “true” labor rate.
Good luck in your search.
I don’t think I’d turn to the jails either. In a lot of industries, the problem was that companies didn’t invest in infrastructure when they had the chance. Regardless of the cost of labor, a 100 year old furniture factory in the South is never going to be able to compete with a brand new, state of the art factory in Vietnam. As the poster above pointed out, in some cases the shipping wipes out the labor advantage. As labor costs and the price of oil continue to increase, that advntage will continue to erode. It won’t happen overnight, or even in 10 years, but I don’t think the current situation where everything we buy is made in Asia is going to continue long term. Eventually those Asian factories will have their hands full making goods for their own markets.
not to mention that the labor changes are starting to equalize the overall market as well. There are only so many contries in the world where manufacturers can find a massive source of cheap labor.
Prison labor is an interesting option. I think that if it came out, you’d get a lot of consumers turned off by the idea. Obviously, waiting ten years isn’t the solution that you wanted to hear. I’d say explore the option of prison labor. Labor is labor. Maybe you’ll rehabillitate someone in the process.
At the company I work for, we are in the same situation. Most of products are made in China, but we do some in Canada too. The product entirely made here is largely empty, so shipping costs are prohibitively expensive for it. Then another product line is modular, so we import parts as-needed from China and assemble and package them here.
Note to Mulletstyle, American Apparel is a unionized shop with decent pay and benefits. Moreover, they definately charge 3x the price of Wal-Mart. Their real product is marketing and the cachet of buying Western.
As for that if I was starting a business, I would want to find a product that people would pay a premium for “made in the USA/Canada”. It would simplify the start-up and quality-control process.
Beyond the “American Apparel” model, there are alot of surprising things being made in North America. From Honda’s engine factories to plastic forks to high-end audio equipment to cast zinc wheel weights. It really depends on the business goals.