This article written by Al Veres, the VP of Operations at SFEG, originally appeared on the SFEG.com website on January 9, 2015
Back in the late 70’s and early 80’s, the big push was to move manufacturing to Mexico. Then in the late 80’s and early 90’s, Asia became the new home for manufacturing. In each of these phases mega companies like GE, Siemens, GM, Ford were the early pioneers making the moves to manufacture outside the US. Smaller companies lagged behind and never felt the full benefits of being able to capitalize on low labor costs and having the advantage of beating their competitors.
All this has changed with the rising labor costs in China and high shipping costs that drive extreme lead times, coupled with large inventory carrying costs. I recall my boss, President of a large corporation, telling us that one day the pendulum will swing back in our direction. Here we are in 2015 and the pendulum is here. The flood gates have not opened entirely but the trickle effect is starting to happen.