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An American business purchasing products from foreign countries certainly creates many challenges. When working with a foreign company there can be some difficulty with achieving a positive final outcome.

A few issues that can arise include:

  • Misunderstandings due to language barriers and “lost in translation”
  • Challenges with manufacturing products
  • In addition, the difficulty of repairing products 

Communication Issues in Doing Business Abroad 

Doing BusinessWorking with other countries opens the door for communication gaps. This could be due to a simple misunderstanding. On the other hand, the gap could be caused by “lost in translation”. In other words, language barriers or translation challenges that create unwelcome errors. 

Whether the communication is happening through emails or even over the phone, barriers exist. These communication barriers can prevent the foreign company from fully understanding the needs of the American company.

They can also cost the American company more money on materials. This can happen due to different terms of products or even various means of measurement. Sometimes in these cases, the foreign company may make assumptions. However, if those assumptions are incorrect, the entire product could be wasted. It can be difficult to bridge the gap of communication which costs the company significant time and money.

Manufacturing Issues

Another issue that can go along with communication includes problems with the actual manufacturing process. If there is a gap in communication there is also a chance that there will be difficulties instructing the foreign country on how to manufacturer the product. If instructions are misunderstood or they have incorrect translations, the foreign business will have a difficult time producing the product.

When there is an issue with manufacturing, there is often a need for a representative from the American company to go on location to the foreign company. Travel costs run high. Especially when traveling abroad. In addition, traveling will also take up useful time that could be utilized for other projects.

Commonly, you can trace manufacturing issues back to communication. However, with no communication gaps, both companies would be able to achieve success through all the stages of production.   

Repair Issues

Another issue that can come from poor communication is damage. Some damage may occur during manufacturing or shipping. If the foreign company attempts repairs, the situation could become worse. Especially, if there was confusion with producing the product in the first place. Furthermore, it is difficult to troubleshoot a problem when they are not in physical proximity.

A company cannot plan for repairs on goods damaged during shipping. There will have to be replacement of pieces when damage occurs. There is no guarantee that repairs will actually fix the problem. However, even if the repairs provide a short-term solution, both parties need to focus on a long-term fix as well.  

Communication, manufacturing, and repair issues are serious concerns. These are all problems that can happen when doing business outside of America. When language barriers exist, it is difficult for everyone to understand the solutions for these problems.

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onshoring custom manufacturing

Onshoring

Falconer Electronics Inc. is seeing a strong upward trend in onshoring custom manufacturing. As a United States based contract manufacturer for over 30 years, we have witnessed many ups and downs in manufacturing.

Recently, it seems like more and more conversations revolve around bringing manufacturing back to the States. One particular reason is due to poor quality products produced in foreign countries. 

Outsourcing production to a manufacturer lends tremendous benefits. Especially for a small business or a start up. However, there are numerous challenges and threats to outsourcing manufacturing operations. Therefore, these threats increase dramatically when you outsource to foreign countries. In addition, outsourcing abroad brings many hidden costs.

These determining factors include the heavy cost of monitoring operations as well as quality control. There is also a lack of intellectual property protection as well as extending the supply chain.

Consequently, these are all reasons a company benefits when onshoring custom manufacturing their products instead of offshoring.

Check out these excellent articles:

“Small Businesses Find Overseas Factories Lead to Colossal Headaches”

“The American Onshoring Trend Is Gaining Momentum”

Benefits of Onshoring Custom Manufacturing

This positive trend with manufacturing operations returning to the U.S. holds great promise. Especially for small U.S. manufacturers. The outsourcing of production abroad to foreign countries certainly carries a negative impact on the U.S.

Therefore, terms such as onshoring, reshoring, and redesign manufacturing are generating a new buzz. Onshoring drastically improves lead times. It also cuts inventory levels. For example, at Falconer Electronics Inc., being located close to vendors narrows the supply chain.

Like Falconer Electronics, other companies in the U.S. are also realizing the many benefits to manufacturing products Stateside. However, this is after decades of losing U.S. manufacturing jobs. The majority of which went to lower cost countries such as China.

Consequently, wage gaps are shrinking between China and the United States which delivers another onshoring benefit.

In addition, the U.S. offers superior infrastructure, automation, education, information technology, and transportation. This may be arguable, but since we are biased, we certainly think we hold an edge. 

Risks with Intellectual and Proprietary Information  

Onshoring custom manufacturing  while partnering with the right company dedicated to your success delivers powerful results. 

The positive impact improves everything from strategy, supply chain, staffing, and operations.

Control over the protection of intellectual property is another one of the many benefits. Especially since there is a huge vulnerability when relying on foreign suppliers. Meanwhile, the threat of stolen proprietary information and processes decreases dramatically in the U.S. 

The loss of proprietary information to a foreign supplier brings devastation to a company. Most noteworthy, legal recourse and recovery is challenging at best. As a result, a company has more control when they choose onshoring compared to offshoring.

Quality Control in Onshoring Custom Manufacturing

Quality control is another serious issue. Separating product development and manufacturing operations can be extremely detrimental. If prototyping and product development are conducted in the States while production heads overseas, quality and consistency may suffer greatly.

Managerial focus, when operations are halfway around the world, lends  a significant disadvantage. Partnering with experts who possess vast experience places you in a position of strength. Close proximity to vendors allows site visits which in turn consistent quality inspection.

Meeting with vendors and suppliers face-to-face creates the opportunity to build long-term trusting relationships. The opportunity to see your products in production while also meeting the actual individuals producing your product delivers incredible value. 

Wrapping It Up

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Offshoring occurs when a company chooses to have their production outsourced to a country outside the United States.

This is due to the hope that their labor costs will be lower.

However, there’s something these companies don’t realize.

Their actions will have a negative effect on the country as a whole.

Offshoring

Offshoring Effects the Economy

There is an effect on the economy when production moves out of the United States.

However, it is not noticeable right away.

This is due to the manner in which a company outsources their business.

In some cases, a company does this in stages.

However, when a company begins to offshore, even just a single production line, it can affect the local economy by: 

  • Decreasing Jobs 
  • Reducing Consumer Spending
  • Negatively Impacting Local Business 

Decreasing Jobs

When companies all over the U.S. begin moving their businesses offshore, there are consequences.

Consequences such as:

  • A decrease in American jobs in favor of an overseas workforce that is cheaper.
  • Additionally, companies terminating some or all of the positions in America.
  • An increase to the unemployment rates for the U.S.
  • Furthermore, a decrease in the amount of monetary flow which will eventually affect the entire country.

Production Effects Consumer Spending 

Offshoring production heightens the economy in other countries. Meanwhile, the economy in our own country will decrease.

This is due to employees spending less caused by reduced income. 

Therefore, those funds are no longer circulating throughout the U.S.

However, this lack of circulated money doesn’t just affect the larger companies.

It makes it more difficult for small and local businesses to thrive as well.

Furthermore, individuals are less likely to spend their money on U.S. based products.

Especially, if there is less money to go around.

Eventually, money goes toward products that are lower in quality from cheap labor countries.

Furthermore, this will increase unemployment.  

Offshoring and It’s Impact on Local Businesses

Offshoring does not just affect larger businesses who move out.

When companies and jobs leave a community, it also negatively affects the businesses that are still here.

Fewer jobs lowers consumer spending. 

The flow of money connects all businesses.

The American economy is dependent on keeping businesses here as well as their employees.

Every lost manufacturing job impacts local service providers, retailers and restaurants. 

In conclusion, the entire country suffers when companies move to other countries.  

Wrapping Up

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LED vs. Incandescent lighting

  

With the changing technology, there is a lot of question as to what is the better choice when it comes to lighting. The main question is which is better; the new lighting option of LED (Light Emitting Diodes) or the well known Incandescent lighting that we all have become accustomed to. There are four main focuses in the argument of what is the better choice: the lifespan of the bulbs, the cost difference, how much power the different bulbs consume, and how much light they actually give off.

Life Span of the Lighting 

One of the strong arguments in favor of LED lighting is their longer lifespans. At just over forty times the longevity of incandescent lighting, the newer LED lights are quickly proving their worth to consumers. This longer lifespan makes it easier for consumers who would have been purchasing numerous amount of the incandescents throughout a year’s time. There is less concern by consumers that they will have to have a continuous supply of light bulbs on hand at all times.

Everyone has had that drawer or cupboard with boxes of light bulbs. They sit in waiting for the next time of darkness, that will come too soon. LED lighting can cut down on the amount of bulbs that consumers need to keep on hand by providing light for a longer amount of time. By installing the LED lighting and not have to worry about replacement for a longer time period there is a good reason to believe that LED lighting would therefore also be more cost-effective.

Price of Bulbs and Cost Lighting

The longer life of the LED bulbs implies that there will be fewer times of replacement. Over time this will save the consumer money. However, if you look at the initial cost LED lights are a noticeable amount more expensive than incandescent bulbs. Incandescent lights can usually be purchased for around $1 or even less in some stores. The $8 or more that LED lights can be found for can make consumers leery of savings.

The initial purchase can seem a frightening amount higher to consumers. However, when they break down the facts about LED bulbs they will more than willing to pay the extra amount. The lifespan of the bulbs already saves the consumer money by cutting back replacement costs. The consumer can also look at the price decrease with the decrease in their electricity use. In some cases the LED bulbs have been known to use five times less the amount of electricity than that of Incandescent bulbs. That decreased use of electricity can add up to a decrease in electricity bills.

Power of the Lighting

There is one major difference between an incandescent bulb and an LED bulb. The incandescent bulbs that everyone has become so accustomed to being purchased on their amount of wattage. While the LED bulbs are measured by their lumens. The idea is that the amount of power running through the bulb affects the brightness of the light. This, however, is only true with the incandescent lights and not the LEDs.

LED bulbs are made to use a lower wattage but have a higher output of lumens. Lumens are the more accurate way of measuring the strength of a bulb. Watts only measure the power running through a bulb, not the amount of light that is given off. LED light bulbs are able to function at a lower wattage. LEDs are able to maximize the amount of light that is given off for use. For example an Incandescent bulb that is rated to be at 150 watts would have the same amount of lumens that a LED bulb rated to be between 25 and 28 watts. The two bulbs are using very different amounts of power. They, however, are achieving the same amount of light that is being seen.

Looking at the differences between the bulbs it is easy to see the benefits of using LED over Incandescent. LED bulbs not only save money but attribute to saving energy. They do this all while doing a better job of lighting up the darkness. Comparing the two types of lighting shows the changes that technology is bringing to everyday objects.