The Rodon Blog - A Focus on Plastic Injection Molding and American Manufacturing

There are many risks involved in selecting an OEM suppliers. Understanding them is essential to running a successful business. In our white paper "Hidden Risks in Your Offshore Supply Chain", we’ll examine three strategic areas to include in your supplier selection process: Cost, Scheduling, and Compliance.

Cost

Cost is not just the final price you pay for a part. Cost also includes shipping, time to market delays, quality control checks as well as labor. Cheap foreign labor is becoming more expensive.  Offshore suppliers face a more demanding workforce. And, today’s consumers are demanding that suppliers provide improved working conditions and pay. All of this is driving up the unit cost of goods sold.

Regulatory compliance has become a focus in recent years.  Products from other countries, particularly China, face additional scrutiny.  From car seats to dog treats, there have been numerous safety problems. 

There are many risks when it comes to selecting OEM suppliers. Understanding them is essential to running a successful business.  In this article, we’ll examine the factors that impact scheduling and time-to-market when using an offshore supplier.

There are many factors that impact the total cost of goods purchased.  On the surface, some offshore suppliers may seem cheaper.  However, the true delivered cost is impacted by many variables.  Using this overview, you should be able to better compare all of your supplier choices.

Shipping - This cost must be calculated accurately to determine the true “Cost of Ownership”.

Many companies fail to understand the full cost of shipping from China and other low wage countries.  Depending on the contract, importers may be responsible for picking the goods up at the factory door.  Many foreign manufacturers will include FOB (Free on board) shipping.

In the past, many businesses operated on the assumption that their vendors were in compliance with the latest rules and regulations regarding their industry.Technology and materials were limited, so buyers worked with manufacturers who could produce the best product often without clearly defined quality guidelines or parameters.

This article written by the Reshoring Initiative Editorial Team originally appeared on the Reshore Now blog on October 15, 2014

It is no secret that the last decade has brought a surge in demand for products made in the USA. But it was only recently we realized how much the “Buy American” movement has evolved.

In a recent survey conducted by American Certified, 1500 people across the nation were asked the question, “Other than price/ quality, what factor is most important to you when purchasing a product?”

A few weeks ago in our blog, we introduced our newest white paper "Hidden Risks in Your Offshore Supply Chain".  In the infographic below, we highlight the 3 primary areas we focus on throughout the white paper that should be included in your strategic decision making process.  When you take all of the factors into account that can impact the cost, scheduling and quality of your manufactured part, you can make a more informed decision about your supplier selection.