Why Bring Manufacturing Back to U.S.?

Why Bring Manufacturing Back to U.S.?

Ray Sjolseth, president of Seesmart Technologies, Inc. points to lead times as major reason.

Seemart Technologies, Inc., designs, engineers and manufactures LED lighting products. Recently the company announced a new line of exterior LED lighting products as an “American-made line” explaining that these products were insourced back to the U.S.

IndustryWeek talked to Sjolesth to find out the reasons behind the move.

Q: If you had to choose the number one reason for bringing this line back to the U.S. from China what would that be?

A:  Our biggest challenge is to make sure that we are able to deliver the products to the customers in the time frame that they need. Our distributors, dealers and end users don’t want to wait the six to eight weeks it takes to get the products from China to the U.S.  As the LED market is basically an impulse buy, products need to be available within a three to four week time range.

Q: Are there other concerns surrounding overseas production?

A: Due to the quicker turnaround time expected we are currently having to air freight the product which is a large expense. Also, as a small company we work on a  just-in-time basis and don’t have inventory waiting around. Everything we make we sell so it’s much easier to supply from a home base in this situation.

With production in the U.S. we have better control over the manufacturing process and are able to keep a closer eye on quality. With local vendors we can manage our cash flow better and grow our business more quickly by having the ability to scale up production at a faster pace to meet increased demand. 

Q: Is “Made in America” label helping your business?

A: Yes. One of the contracts we had specifically required that the product be “Made in America.” We need to be able to satisfy those customers.

Q: What percentage of your products are manufactured in the U.S.?

A: At this point it’s 20% but we hope to have it to 75% by the end of next year. We currently have a factory in California and plan to open one in Chicago later this year.

Q:  Any advice for other companies looking to bring production back to the U.S.?

A:  Companies should have a well thought out plan with meticulous documentation. This is especially true if you are relying on a contract manufacturer. You need to make sure you know everything that is happening within that contract manufacturer’s operation to make a smoother transition.

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