Low
production cost countries would have led to lower prices and we are all
very quick to take advantage of them but apart from the cost of
purchase, a shift in how we meet the market also need to change the way
that the market served.
My
particular area of interest is a barbecue manufacturing because many
of these products have gone abroad in recent years and I love grilling
and smoking. The point that I make is more general but as an example I will refer to a gas grill for demonstration purposes.
Supply ChainLow
production cost countries would mean that the distance from point of
manufacture to point of sale and which in turn means that the demand
forecast must be beautiful in places. Barbecue season is very seasonal and fairly easy to forecast high in summer low in winter, but we will buy smoker? Are we going to buy a grill? Weber or Meco?
At
the end of the season there will be a lot of unsold stock which needs
to be moved to make way for Christmas decorations and that means a great
opportunity for you and me to pick up cheap in the Fall. If you want to buy a grill, and do not mind to keep it for the winter before you use it, you really can save a lot of money.
QualityIt
could be a significant cost for any business especially if you do not
get it right and if you consider the length of the supply chain becomes
immediately clear that if you have a manufacturing problem and the error
is found only in point of sale, there may be three months or more items
damaged by supply chain presents a nightmare to complete.
Low
cost country sourcing is very risky if you do quality control closer to
the point of sale is not close to the point of manufacture. Many
companies have got their fingers burned and learned the hard way but in
my opinion there is no alternative - if you choose to produce and take
advantage of low cost country sourcing you still have to invest in
quality control facilities at the point of manufacture.
For consumers generally means fewer damaged item reaches the retailer. Can you remember the last time you take something back because it is corrupted? And if you do, I'm sure the product is replaced rather than sent for repair. It's
actually better and cheaper for manufacturers to release just another
BBQ of the supply chain and replace your goods rather than to consider
improvements.
EthicsEthical
dilemma of immediate local manufacturing move overseas have a direct
impact on the local economy where businesses are based and this can
cause significant adverse pressure. It is also possible that the countries from which the new manufacturing place have dubious human rights records.
This is a consumer dilemma, low-cost or ethically made in America. Unfortunately it would appear that the low cost is winning this argument.
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