The other day we talked about mass-produced products being the only ones making it to the market. We stated that this was because they require high sales volumes to break-even. However, we also discussed that some manufacturing was able to be customized and more easily distributed. In the past, it required large capital investments to start up a large scale manufacturing facility.
Additionally, high labor costs encouraged many manufacturing operations to move to China and take advantage of their cheaper labor. However, the gap is narrowing as offshore labor costs are on the rise and the cost of automated production via robotics is coming down.
The recent lower fuel costs involved in the transportation of goods shipped from Asia have masked the shrinking gap in the last year. However, it will soon catch up and be amplified if and when fuel prices rise again. For example, it is still the domain of China to produce products manufactured in large batches that require tooling and labor-intensive assembly. By contrast, small batch sizes and customization are now the domain of the US.
Can you take advantage of this automation and capture a share of the returning NEW manufacturing industry?
