While global manufacturing has traditionally been viewed as a cost saving strategy, many businesses are revising their onshoring/offshoring approach. The pandemic has exposed the vulnerabilities of global supply chains which require interdependencies between businesses and international suppliers. Varying levels of government mandated lockdowns, closed borders, and slowed productions have caused worldwide supply shortages, affecting businesses in every industry.

Here are five reasons to consider switching your manufacturing processes to onshore partners.

1. Transportation Freight Costs

Shipping costs involved in offshoring and nearshoring processes continue to rise. According to recent research by Freightos, the rapid growth of global eCommerce and the upcoming holiday peak shipping season are contributing to record freight rates. This means that the significant savings that incentivized offshoring in the late 20th century have been largely reduced or eliminated. Domestic shipping processes are easy to implement and are becoming more cost efficient.

2. Proximity to the Market

By keeping your manufacturing processes stateside, you will reward yourself with shorter shipping and turnaround times. With an offshore machine shop, production typically needs to be planned months out to account for production and delivery. With a domestic machine shop, you can place and fulfill part orders with much shorter lead times. This translates to improved product inventory management and increased responsiveness to demand for your product.

3. Superior Quality

Some large companies might have the ability to have employees stationed at overseas factories to ensure quality, but most small businesses must operate in faith that goods will be produced to quality standards.

Upon receipt of product from offshoring partners, it is not uncommon for entire batches to be inspected piece by piece upon arrival to separate defective units from quality product. This is because effective quality control is not practiced by all international manufacturers, and differing product standards. The time and expense to do this, along with the cost of either reworking or scrapping products, can quickly wipe out the savings offshoring promised and even exceed the made-in-America cost.

4. Ease of Communication

The time zone difference is one of the most obvious pain points of offshoring. Many offshoring manufacturers operate within a 5-12 hour difference from their client, meaning work schedules may need to be adjusted to accommodate timely communication.

Onshoring operations and using domestic partners often allows companies to operate in the same/similar time zones as the companies they hire. It also reduces language barriers, cultural barriers, and transportation complexities.

The ease of communication also allows you to react to fluctuations in demand more quickly.This will increase your ability to deliver quality products in a timely manner.

5. Market product as Made in the USA!

Critics of offshoring note that the level of unemployment in America increases as more jobs move overseas. Moving jobs overseas can hurt the national economy and livelihood of cities and towns across the country.

Choosing a provider in the US creates more open positions for qualified local individuals and helps to bolster our national economy, along with the other benefits mentioned above. If you’re looking for a new onshore machining partner, contact us to see how we can partner.

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