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Made in the USA – NOT!
By Jim Stavis
The decline of manufacturing in North
America is often discussed in terms of lost
jobs. What is equally troubling is how many
traditional American products are now being
manufactured in other corners of the globe.
The Metal Service Center Institute (MSCI)
compiled 12 such products that were American
based icons for many years before finding them
better suited for offshore production.
Nearly half of manufacturing plants—45
percent—now source components and
materials from China. Talk about your China
syndrome. Of those, 74 percent indicate the
dollar volume of components and raw materials
has increased over the past three years. 45
percent of primary metal manufacturers and
41 percent of fabricated metal plants indicate
that Chinese competitors have caused their
plant’s profitability to decrease. Fabricated
metal products accounted for $23 billion in
U.S. exports in 2004 while U.S. manufacturing
contributed a hefty $11.74 trillion to the
nation’s GDP in 2004 (13 percent of the total).
These statistics reflect how important American manufacturing is to the well being of our
country.
I once listened to a speaker of
British origin who lamented how Great
Britain used to be a manufacturing power
in the world, but now is merely a “service
provider” of products made elsewhere. He
warned us not to allow in this country
what has occurred in his homeland,
“because once you lose your manufacturing
base, you will never get it back.” We see
examples of this all around. Here are the
12 products MSCI has determined are no
longer made in America:
Gym Shoes: Nike / Converse – Founded
in 1962 in Oregon, Nike Inc. operates 109
apparel contract factories and 12 equipment
factories around the globe. Nike estimatesonly 14 percent of their entire apparel line
is made in America, while the rest is made
in 33 countries worldwide.
Gun Trigger Locks: Master Locks – More
than 90 percent of all trigger locks today
are manufactured in Asia.
Bicycles: Huffy Bicycle – Huffy now
produces a bicycle made in China for less
than half of what it cost when it was made
in Celina, Ohio. China now produces 80
percent of the world’s bicycles (79 million
in 2004 and exports 51 million to the
U.S., Japan, Australia, South Korea and
Indonesia).
Bras: Maidenform – The largest bra
maker manufacturers 56 percent of its
product in China, 36 percent in Thailand
and 8 percent in the Phillipines
Golf Clubs: Titleist, Cobra & TaylorMade – Nearly 70 percent of golf clubs have some
components that are made in China. This
includes a list of U.S. makers such as Titleist,
Cobra and
Taylormade.
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Radios: Motorola & RCA – The vast
majority of AM/FM radios are made
overseas, including those made under the
U.S. brands of Motorola and RCA.
Musical Instruments: Fender – In
1990, Fender Musical Instruments began
producing guitars in a plant in Ensenada,
Mexico while other entry level models are
produced in Korea.
Blue Jeans: Levi Strauss – In 1990, Levi
Strauss, an American icon, began sending
its trademark jeans production overseas.
By 2002, the company had closed virtually
all domestic production and increased
production to countries such as China and
Costa Rica. In 2004, Levi closed its last two
sewing plants in the U.S.
Toys: Mattel – Mattel makes about half of
its products in Asia and most of its popular
Barbie dolls in China. Last year the company exported $7.58 billion worth of toys made
from 8,000 toy factories (estimated to be
70 percent of the world’s toys).
Automobiles: Ford Motor Company – Ford manufacturers their American
classics with 65 percent U.S. / Canadian
parts, with transmissions made in Mexico
and engines from Germany. It also operates
plants in Thailand, Malaysia, Philippines,
Mexico and India.
Film: Eastman Kodak – Kodak is one
of the largest manufacturers of cameras
and film and has moved its production to
Mexico and China.
Baseballs: Rawlings – The great American
game has seen Rawlings, the only supplier to
Major League Baseball, shift its hand-sewn balls
to a 450 person factory located in Costa Rica.
If you were raised in America, these
are pretty sobering examples of what is
happening within the new global economy.
And yet due to the need to stay competitive,
companies are doing what is necessary to
keep their businesses profitable. It makes
you wonder, at what cost?
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Stay Flexible – Be Prepared to Change
By Jim Stavis
One thing we know: things never stay
the same. Because of this fact, it behooves
us to prepare for the uncertain future,
to anticipate and react accordingly.
When we started in the steel
business back in 1988, the industry
landscape looked entirely different
than it currently does today. Back
then, service was rarely discussed and
customer bought products in the
manner that distributors sold them.
Rarely did distributors ask their
customers what their needs were,
because it really didn’t matter. It was
like Ford selling Model Ts in any
color—as long as it was black.
As the service economy took hold, soon distributors had to sell products
to the specific desires of its customers.
This required special packaging, cutting,
processing, shorter lead times, etc.
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For
the distributor, this required wholesale
changes within their operations. We
would like to think that Paragon
Steel was a leader in this industry
transformation. We looked at the
industry around us and asked why— or
rather why not—do things differently?
We still ask the same questions
today as to how we can better serve our
customers. Our key has been to maintain
our flexibility and not get too entrenched
with a single product line or customer
niche. Because we understand change
and know that today’s hot product will
be on tomorrow’s discount rack. |
