While a trend for the past few decades has been to turn to overseas manufacturers for packaging solutions, more and more brands are beginning to "bring it back home." For many, their initial departure was based simply on dollars and cents. Others were swept away by an outgoing tide of perception that "the grass is always greener on the other side;" and somehow, traveling halfway around the world would make their projects easier and better. But reality and perceptions have changed dramatically, leading more companies to consider (or reconsider) packaging solutions partners in U.S. For these firms, it's more than a patriotic gesture; it's very smart business.
Here are five reasons why:
1. Rising costs in overseas labor and transportation:
The substantially lower cost of labor in Asia was a key motivator for American companies to take manufacturing offshore. But the gap between U.S. and overseas labor costs is now shrinking. In fact, workers' wages in China have risen sharply in the last decade; doubling between 2003 and 2008. Some studies indicate that American and Chinese wages may converge as early as 2015. Combine that with fluctuating currency rates and the ever-present potential for political issues, and it can all add up to considerable uncertainty from a cost standpoint.
Transportation expenses are another significant â€“ and often overlooked or under-estimated â€“ factor. Jim Anderson, O.Berk's Senior Operations Manager, explains: "As anybody who drives a car knows, the cost of fuel has gone up dramatically. Rising transportation expenses, combined with increasing overseas labor costs, are offsetting any real or perceived advantages of sourcing abroad. Increased fuel prices further complicate the overseas logistics equation, which is made even more ambiguous when you factor in related issues like warehousing and pilferage."
In the meantime, here at home, American manufacturers and suppliers continue to apply numerous strategies designed to lower the cost of their goods and services through increased productivity, including use of robotics, data management, and other time saving, efficiency-driving technologies.
2. Quality assurance:
O.Berk of New England Vice President and General Manager Brenda Kursawe can attest to the fact that while everybody wants a good price, they still demand and expect high quality: "People remember the alarming headlines like 'Lead paint used on toys manufactured abroad.' Unless you can station a full-time quality assurance manager abroad who speaks the language, knows the customs, and has the clout, you stand to face a plethora of problems: non-adherence to standards, swapping of materials, and more. Not only does that mean getting stuck with product that can't be used, it also results in diminished respect for a brand in the eyes of the consumer."
Unlike manufacturers in the low-wage countries of Asia, Eastern Europe and Central America, many of the U.S. sources with whom O.Berk partners often have been in business for 40-plus years. Many, like O.Berk, are also family-owned and operated, with strong ties to their communities. They strictly adhere to U.S. product safety and consumer laws. If problems do arise, they are resolved quickly and satisfactorily.
Kursawe explains, "At O.Berk, we stake our own reputation on the quality of the solutions we provide. One of the best ways we can ensure a quality solution is to only work with manufacturers that adhere to the same high quality standards. Our U.S. manufacturer partners all understand and share our quality-driven philosophy." And what does this mean for customers? "Put simply, total peace of mind," she adds.
3. Supporting green initiatives:
Like buying American, going green is a sound business strategy and one that is better supported by sourcing U.S.-made goods. Joel Simpson, Vice President of Sales and Marketing at O.Berk, points to statistics: "Research continues to point to the fact that U.S. consumers are generally willing to pay a bit more for American made products, even in economically challenging times, and especially when the product in question is environmental friendly."
American manufacturers understand that going green can be very cost-effective. Simpson adds, "Our U.S. sources have focused their efforts on cutting waste, not cutting corners." Waste diversion and energy reduction programs all add up to green for both the environment, and in terms of cost-savings. Plus, brands also benefit from the genuine consumer appreciation for both a product that uses sustainable packaging, and the company that brings it to market.
Another benefit in buying U.S.-made goods instead of importing them from abroad is the reduced carbon footprint: Not only is fuel expensive, but transporting goods around the globe burns up considerably more energy resources.
4. Speed to market:
While it may seem like the most obvious culprit, it's not just distance that can bog down speed to market. Ray Francis, General Manager at O.Berk/Kols Containers, sees it this way: "Literally, things can get lost in translation. Cultural differences and shifts in the political landscape, plus the more recent labor issues in some offshore manufacturing countries; these are the events that can add days, weeks and even months in delays."
Missed market opportunities are costly. Infrastructure and transportation issues, as well as worker shortages in foreign countries, have meant that orders may be significantly delayed. Consider, too, the potential need to keep a greater inventory on-hand to offset late deliveries, or having to deal with production errors or sub-standard products
A study by the consulting firm Accenture further illustrates: "Managing supply operations that are separated far from where demand occurs has weakened (a company's) overall operational planning, forecasting and general flexibility; while in some cases driving up costs with the need for complex network management."
O.Berk continues to cultivate relationships with U.S. vendors that help ensure timely delivery and provide customers high confidence. Not only are these trusted resources seldom more than two time zones or 1,500 miles away (rather than 12 hours or 12,000 miles from home), they are proven, valued partners committed to customer success.
5. Providing outstanding service:
O.Berk CEO Marc Gaelen sums it up: "Among the advantages we have found in working with American manufacturers is a dedication to providing a high degree of service. This dovetails with O.Berk's service philosophy: 'Through a culture of innovation, quality, reliability and speed, we seek to provide value-added, responsive, 'win/win' turn-key solutions to help customers in getting their products to market faster, smarter, and more efficiently'."
If you've visited our recently re-launched website you know that O.Berk has been proudly offering American-made containers and closures for more then a century. From Foamer Dispensers to Wide-Mouth S Packers, we offer a wide range of domestically manufactured containers and closures of the highest quality.
Our U.S. vendor partners know that when they work with O.Berk, they are held to the same high standards we set for ourselves. Just like us, they are committed to providing quality, acting with speed and efficiency, and being solution-oriented. It's a strategic difference that distinguishes them from offshore competition. And, it's paying off in the long run for our customers.
"Home" is where the help is.
To learn more about O.Berk's "All-American" complete packaging solutions, please call us at 800.631.7392 or contact us by e-mail: firstname.lastname@example.org. We're always ready to help!