Where to Manufacture Your Product: China? USA? UK

Thinking of Manufacturing a New Product? Here’s How to Decide Between the USA and China

Got a brilliant new product idea and wondering where to manufacture it? Nowadays, China often seems like the go-to option. However, before you commit, it’s worth comparing manufacturing in the USA versus China. According to the 2016 Global Manufacturing Competitiveness Index, China currently leads as the most competitive manufacturing nation. But, by the end of the decade, the USA is projected to take the top spot. The index highlights talent as the key driver of global manufacturing competitiveness, followed by cost competitiveness, productivity, and supplier networks.

Here are some compelling reasons to consider manufacturing in the USA instead of China:

• No Language or Cultural Barriers: Communication is straightforward, without the complications of language or cultural differences.
• Faster and Cheaper Shipping: Shipping within the USA is quicker and less expensive compared to international shipping from China.
• No Customs or Duties: Avoid the hassle of customs paperwork and duties.
• Easier Legal Recourse: Resolving conflicts and disputes is more manageable.
• More Payment Options: You have a broader range of payment methods available.
• In-Person Quality Checks: It’s easier and cheaper to verify the manufacturer and product quality in person.

However, manufacturing and labour costs are generally higher in the US than in China. A recent poll by the Chicago Tribune found that many Americans prefer lower-priced items over those labelled ‘Made in America.’

If you’re interested in finding American manufacturers, there are several useful websites. Maker’s Row is a platform dedicated to US manufacturing, while Thomasnet lists over 700,000 suppliers in the US and Canada. The M and A Expo Database can help you find trade shows where you can connect with US manufacturers.

When considering a Chinese manufacturer, keep these three factors in mind: quality, price, and delivery time. There are pros and cons to choosing a manufacturer in China:

Pros:

• Low Cost: Cost-effectiveness is the main advantage of manufacturing in China.
• Extensive Business Ecosystem: China boasts a vast network of suppliers, distributors, customers, competitors, and government agencies.
• Flexible Order Sizes: Manufacturers are often willing to handle orders of nearly any size.

Cons:

• Language and Cultural Barriers: These can lead to communication issues.
• Shipping Considerations: Shipping from China involves time and cost.
• Customs Hurdles: You’ll have to navigate customs procedures.
• Limited Legal Recourse: It’s challenging to seek legal redress in cases of fraud or theft.
• Quality Perceptions: Goods from China are sometimes perceived as lower quality.
• Difficult Quality Verification: The time and expense of travelling to China make it hard to personally check quality.

To find Chinese manufacturers, try websites like Alibaba, Global Sources, and Made in China. Additionally, Chinese manufacturers are often featured at trade shows such as the Asia America Trade Show in Miami. You can also check the China Exhibition website for listings of trade shows in China.

Once you’ve decided whether to manufacture domestically or offshore, follow these steps to choose the right manufacturer:

• Conduct Online Research: Look up companies by name and check their online profiles and ratings. For US companies, consult sites like Ripoff Report and the Better Business Bureau.
• Ask for References: Request references from the manufacturer and contact them.
• Check Expertise: Choose a manufacturer with proven experience in your product category.
• Assess Capacity: Select a manufacturer large enough to fulfil your order, but not so large that your order gets sidelined for bigger clients.
• Inquire About Quality Control: Understand their quality control processes and how they ensure your product meets specifications.
• Get Detailed Specs: Request comprehensive product and packaging specifications.
• Check Minimum Orders: Clarify minimum order requirements.
• Understand Shipping: Ask about their shipping process and whether they partner with a logistics company.

After selecting your manufacturer, you’ll need a contract. This is a task best handled by a lawyer experienced in this area of law. Be clear about the ownership of moulds/tooling and the protection of your intellectual property. If you haven’t already, now is the time to apply for patents.

Bringing a new product to market is an exciting journey. With thorough research and careful planning, you might just be the next big success story. Without due diligence, though, you could face costly setbacks. So, be thorough and aim high!

ThinkClever