American vs Chinese Manufacturing

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Disclaimer: This is an essay submission for the Fishbowl Supply Chain Management Scholarship and does not reflect the opinions of Fishbowl

The Way American Manufacturers Can Compete with Chinese Manufacturers – By Rae Webb

U.S. manufacturers can compete with Chinese manufacturers. These companies will have to not only analyze various components of their operation but take a risk and change these components to become better than Chinese manufacturers. Initially, we must analyze the standard manufacturing processes to determine what we could implement in the U.S. in full scope, beginning with supply all the way to delivery, as well as come up with the technology in order to expedite lengthier processes.

Chinese manufacturing is a trailblazer in the world. I believe a huge component is their supply chain, as well as limited regulation in the workforce. Additionally, their business structure prepares them to deliver on a level that supports international output. For U.S. manufacturers to be competitive they will have to develop infrastructure strategy to support international output, as well as cultivate a workforce that will stay within the parameters of U.S. laws, but increase their overall production. Given U.S. law, as well as our limited access to supply, U.S. manufacturers’ main solution will be replacing personnel with technology in order to increase output in a shorter amount of time without breaking any labor laws. So the underlying question when analyzing the steps it takes for a full production company is: at what levels of production will technology shorten the amount of time for production as well as increase overall output?

The U.S.’s largest issue would be the supply chain. Where are we getting the supply, how much, and when? Chinese, more than likely, get their supply in-house for a fraction of the price, whenever they need. If it’s not in-house, it’s likely traded for little to no cost because they have access to so many resources that other countries do not have. They have a huge bargaining chip. Considering the U.S.’s limited supply, we must analyze the supply chain and come up with solutions that ultimately lessen the overall cost while increasing the amount of supply and how often we will receive it.

Additionally, the U.S. must consider what they are manufacturing. The Chinese are versatile and are contracted to make various products because they are able to deliver large amounts in a short length of time and the product is of decent quality. The U.S. could win big in this area because if we contracted companies in the U.S., the financial stimulus could be the catalyst for substantial growth in overall manufacturing. Companies would have to vary their product output, develop a broader supply, and develop a faster production line. The only component that would be a possible deterrent is the quality of the product that determines the overall price. The Chinese have made a niche amongst manufacturing by developing decent-quality product at the lowest price in order to give a contracting company the greatest return from reselling. The U.S. would have to analyze where they could minimize their overall cost, while increasing production for a cheaper competitive price. Investing in technology would be the best solution, as well as gaining multiple contracts.

Of course, with the implementation of technology and replacing personnel with machines, many would be out of work or have their hours cut. The final assessment would be how to create jobs that would be more beneficial to the company. One suggested investment would be in sales, ingenuity, and expanding the manufacturing processes. Creating jobs where they are taken in the areas of development, operation, and analytics would result in strengthening and expanding the company. For a U.S. manufacturing company, the initial investment would be great, but the reward would be greater. Overall, assessing, investing, taking some risk, and driving change within manufacturing companies can make U.S. the leading manufacturer of the world.

Lean more about supply chain management: What Is Supply Chain Management?

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