Is Overseas Manufacturing Right For Me?
Ultimately, your in business because you want to make money. You think you have a product or a service that there is a market for and people will be happy to pay you for it, great! The tricky part is, what price will they be willing to pay and how much is it going to cost you to make it? You probably want to maximize your profit margin and depending on what the product is, that means looking at cost effective manufacturing. So, with that being said, is it cheaper to manufacture your product overseas? Maybe, it depends on what you make.
That seems like an elusive answer but the reality is manufacturing overseas is not the answer for everyone. The real cost savings is in labor. If your product requires a lot of steps to assemble, lots of sub assemblies and parts, it would probably be cheaper overseas. On the other hand if you make something like plastic drink coasters, a product that comes out of the molding machine in a finished state, then no, it’s not necessarily cheaper to manufacture overseas. Plastic is basically a commodity so the raw price shouldn’t be much cheaper anywhere else than here and you only really need to pay a machine operator. The production lead time will be much shorter since you are cutting out the freight time of shipping your product to the states. A good example of this is Tervis Tumbler, insulated plastic drink glasses made in Florida since the 60’s.
I’m sorry to say that brings us back to “it depends”. If your product requires some assembly in manufacturing or needs a decent amount of labor like painting or functional adjustment then yes, you probably would be saving money by manufacturing overseas. Having said that though, it’s not uncommon to have some component of a product made overseas and have the final assembly completed in the states. A curious end note is that though there is a resurgence in “Made in America” feelings across the states, one of the most popular products ever sold is the iPhone, a product made entirely in China.