The trend of “reshoring” manufacturing showed up in my back yard last week, with a story in the Alva Review-Courier about local business Vantage Plane Plastics.
|Vantage Plane Plastics in my hometown,
Alva, Oklahoma, is competing with China
for manufacturing jobs.
Another Oklahoma manufacturer had planned to outsource their product to China, when a sudden increase in shipping costs derailed that plan. Vantage took on the project with a much lower minimum order, saving the original company money. Vantage saved them even more money by catching and fixing a design flaw. If the job had been done in China, the entire container load would have had to be scrapped.
Outsourcing manufacturing to China and other countries is becoming less competitive, and spells opportunity for local custom manufacturing firms. Hourly wage rates in China sound attractive, but are not the only cost factor. In this case, the shipping cost, the lower minimum order, and saving $290,000 in scrapped product, all made Oklahoma more than competitive with China.
Thanks to the Oklahoma Manufacturing Alliance for writing the original story and giving me permission to share a few excerpts here.
Tim Hartman, of PTO Productions, LLC, of Edmond, Okla., was helping Fun Sports Products, Inc. to manufacture and market The Shutout Mound, a plastic pitching mound used to train pitchers.
“We were just about to approve the manufacturing deal with China when they increased our shipping cost,” Hartman said. “The revised shipping cost for a container load caused us to hold and re-evaluate.”
Vantage General Manager Mark Seaver offered several advantages to his local production over outsourcing to China.
“Same material, same product, lower minimum-volume requirements, and no need to put all of our money out there at once,” Hartman said. “They handle the warehousing too. Mark provided us a one-stop solution.”
Oklahoma Manufacturing Alliance Extension Agent Kevin Barber said, “The less visible costs of manufacturing overseas like managing additional inventory in the shipping lanes, managing quality issues, and maintaining good relationships with your foreign manufacturers are very real and make manufacturing in Oklahoma an attractive and feasible alternative.”
New to SmallBizSurvival.com? Take the Guided Tour. Like what you see? Get our updates.
- Move Your Money and Bank Local - March 22, 2023
- Using a building as a warehouse or storage in a small town? Put up a sign - March 13, 2023
- How to get customers in the door of small town and rural retail stores - February 19, 2023
- Check your small business website for outdated pandemic changes, missing info - January 31, 2023
- Rural Tourism Trend: electric vehicle chargers can drive visitors - January 15, 2023
- 2023 trends for rural and small town businesses - December 26, 2022
- Local reviews on Google Maps drive enduring value - December 17, 2022
- Extra agritourism revenue from camping, cabins and RVs with HipCamp - December 12, 2022
- Harvest Hosts attract vanlifers and RV tourists, Boondockers Welcome - December 2, 2022
- Holiday 2022 marketing: Tell your founding story - December 1, 2022