reshoring manufacturing

Reshoring Manufacturing Will Trend in 2021 and Beyond

That collective sigh of relief you hear is that 2020 is winding down. Let’s be honest, some words nobody ever wants to hear again include pandemic, unprecedented, protocols, and coronavirus. 2020 was a rough year for a lot of different reasons, but as always, a new year brings with it a renewed optimism and new things to look forward to. Plenty of business models were stretched to their limits in 2020, and reshoring manufacturing looks to be an obvious trend in 2021 and beyond.

Nobody was prepared for a pandemic in 2020, and one of the issues brought to light in the manufacturing world is just how many domestic brands relied heavily on China for fulfilling some, part, or nearly all of their supply chain. The economic challenges brought on by the disruption in the supply chain have forced manufacturers to change their business models in a hurry to stay competitive. What they’re learning is that reshoring manufacturing can not only help in recovery but bring about unprecedented growth.

The Reshoring Initiative was founded in 2010 and is focused on bringing manufacturing jobs back to the U.S. by helping manufacturers realize that in some cases, local production reduces their total cost of ownership of purchased parts and tooling.

Harry Moser is the founder and president of the Reshoring Initiative and is also on the Commerce Department Investment Advisory Council. Moser was recently asked what the key considerations are for reshoring pre-and-post COVID-19.

“Multi-step, multi-country manufacturing was already under stress even before the COVID-19 pandemic, which has severely disrupted the global logistics network,” Moser said. “Our intellectual understanding of trade wars during this crisis now reveals the supply chain weakness—we simply don’t make enough components on our own shores. The global supply chain as we knew it is essentially a dangerous supply chain which has lead us to the current result of death and economic disaster.”

Manufacturers Revaluate Shoring & Sourcing

The Reshoring Initiative has worked. Reshoring manufacturing—bringing imported goods or materials back to domestic production—was well on its way to becoming common practice amongst U.S.-based manufacturers before COVID-19. According to some reports, well over 700,000 jobs were brought back to the U.S. between 2010 and 2018 as a result of reshoring.

Along with the initiative, there are a number of reasons for this:

  • The cost of transportation continues to rise
  • Manufacturers now use advanced software programs and robotics to automate many of the processes that once required human work
  • Many of the go-to offshoring countries have seen their economies strengthen in recent years, leading to an increase in wages for their citizens
  • Countries in which labor remains inexpensive lack the infrastructure to support complex manufacturing operations

The pandemic of 2020 adds an exclamation point to that list.

“COVID-19 has really gotten people’s attention. It’s revealed the U.S. dependency on offshore manufacturing, especially China,” said Moser. “As the pandemic shows, we can suddenly be in the impossible position of not having enough critical supplies. That is not because we didn’t try it; it’s because we had almost no base from which to build here in the U.S.”

In addition to prompting a renewed reshoring effort, COVID-19 has also led manufacturers to reevaluate sourcing. The pandemic has caused great disruption to the global supply chain, making it more challenging for manufacturers who source from other countries to get a hold of materials.

An Uptick in Reshoring Manufacturing

Establishing solid partnerships with domestic manufacturers makes all the sense in the world heading into 2021 and beyond. As Moser says, “The supply chain math is obvious, and developing partnerships is the new reshoring. Customers, in most cases, are willing to pay a premium for on-time, as-promised delivery commitments. The goal is to convince companies to do the math and decide what to re-shore now.”

Look for both reshoring and near-sourcing (also known as local sourcing, is the process by which a business brings operations closer to where its finished product is sold; in manufacturing, it typically refers to sourcing raw materials from U.S. suppliers) to be leading trends in 2021, as manufacturers try to reduce or eliminate dependence on foreign materials. These trends will not only help manufacturers remain resilient to future COVID-related disruptions they will also provide a much-needed boost to the U.S. economy.

Cass Precision Machining has a long history as an established and trusted U.S.-based manufacturer committed to delivering on-time, high-quality machined parts. We welcome the opportunity to help your organization establish a reliable and consistent partnership. Please don’t hesitate to contact us at 763-535-0501 to see if we can service your needs!

prototype machining

Top 5 Questions to Ask When Considering Prototype Machining

Cass Precision Machining is proud to unveil Cass Rapid Prototype Machining (C-RPM), a new independent business unit operating within our five-building campus. C-RPM significantly ramps up our ability to serve you with prototype build-to-print contract machined parts services with accelerated delivery responsiveness. Operating as a business within a business, C-RPM’s “high touch” service connects you directly with our prototyping team. C-RPM continues our 75-year commitment to providing the “Best-in-Class” service.

News of the launch of our C-RPM unit was recently in the news, getting featured on websites MarketWatch, the Chicago Daily Herald, and Minnesota Metals News.

When considering outsourcing your prototype machining requirements, here are five questions you should be asking your supplier candidates:

1. Will I have access to DFM (Design for Manufacturing) resources?

When optimizing functionality and cost of new parts, the most experienced design engineers will seek to collaborate with production engineers to assure that their designs take full advantage of the lowest cost options available for the part, while still achieving desired functionality.  Your supplier should be able to provide your design team access to the right folks to review and confirm your prototype design or suggest options that assure production-ability within cost targets.

2. Are design intent, application specifics, and life cycle requirements part of the pre-order dialogue?

Best DFM practices suggest that designers collaborate with the supplier to understand the fit of the part into the overall design, the functional requirements, and the life cycle volume expectations so that your supplier comes to the table with recommendations to improve your design while optimizing your cost position.

3. Are material selection, critical tolerances, and general manufacturing standards addressed and confirmed at time of order entry?

Industry experts claim that 70 to 80% of the life cycle cost of a part is locked in once the design is finalized and released to production.  Before building that first prototype part, checking in with your supplier to confirm that your material selection is the lowest cost alternative for your application and that the critical tolerances can be achieved, but also have been reviewed and optimized with your supplier helps assure that the best starting point for cost can be delivered.  Don’t forget to compare your general drawing requirements (e.g. tolerances, finish specs, etc.) with your suppliers’ shop standards as another means of identifying areas where production costs can be minimized.

4. Can the supplier provide you with a “complete part”?

It is a challenge – particularly under design-build schedules calling for breakneck speed to market responsiveness – to choose a supplier and then have to vet, select and qualify additional suppliers for finishing services or value-added features on your part. Shop for the prototype supplier that can coordinate it all for you and relieve some of the hassles that quick turn manufacturing presents to your supply chain professionals.

5. Can the supplier support the full life cycle requirements for your parts?

There is no doubt that when working with rapid prototype machining, there is an advantage to being able to partner with the same supplier. Clearly, the costs of switching suppliers can be prohibitive and under today’s JIT supply chain pressures, logistically challenging as well. An often overlooked benefit is the ease of processing rev changes over the life cycle of the part to respond to functionality needs or to aid in cost reduction/management when your supplier remains a constant.

We encourage you to build these five questions into your prototype machining supplier selection process. We look forward to being challenged to reply to your specifics when you include Cass into the mix. We think you’ll like our answers and look forward to building strong partnerships with you for the long haul!