The Reshoring trend is gathering momentum.
Manufacturing is a key element in solving our nation’s economic problems.
The positive effects of a robust manufacturing sector are measured well beyond manufacturing.
Reports from the National Association of Manufacturing (NAM) indicate every dollar that’s created in manufacturing, has a 1.4 multiplier effect on the entire economy.
Also, two thirds of U.S. research and development is concentrated in manufacturing making it a high-powered economic sector.
The manufacturing multiplier effect drives other sectors, creating jobs and investment in non-manufacturing sectors.
Reshoring U.S. manufacturing is becoming more attractive and a good strategic move for many companies due to rising wages, sourcing risks along complicated supply chains, flexibility to respond to customers changing needs, intellectual property risks, the benefits to innovation and cheap, abundant natural gas.
The not-for-profit Reshoring Initiative’s free Total Cost of Ownership software can help corporations calculate the real P&L impact of reshoring or offshoring.
TCO Estimator http://www.reshorenow.org/TCO_Estimator.cfm
In many cases companies will find that, although the production cost is lower offshore, the total cost is higher.
Current research shows many companies can reshore about 25% of what they have offshored and improve their profitability if they used TCO instead of price to make their decision.
The Reshoring Initiative www.reshorenow.org tracks all reported and some private cases of reshoring and concludes that about 100,000 manufacturing jobs have been reshored since Jan. 1, 2010.
I also recommend reading “ReMaking America” the AAM’s new book on the wealth and growth opportunities of manufacturing in the U.S. Harry Moser, founder of The Reshoring Initiative wrote an excellent chapter on Reshoring. http://americanmanufacturing.org/remake-america/
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