Offshore or domestic production? It’s a question we often hear from customers in regards to packaging solutions — and one we want to help answer. This is best accomplished by weighing the benefits of each option.
While we start the conversation here with the advantages of offshore production, we’ll follow up shortly with one directed at domestic production. (Stay tuned!)
6 Advantages of Using Offshore Production
Offshore production facilities are typically designed to support high-volume production. This can be attributed to the fact that overseas manufacturing is generally less expensive than domestic production. With the ability to mass-produce products, it’s possible to get large-volume orders out the door faster and keep up with industry demands.
Use of Less Expensive Raw Materials
Both offshore and domestic production facilities aim to leverage high-quality materials. Yet, from a logistical standpoint, offshore production puts you in closer proximity to the material source. While this reduces the cost of the materials, it also benefits the entire supply chain as there is one less reason for delays in production operations.
Lower Labor Costs
In combination with less expensive raw materials, skilled overseas labor also comes at a fraction of the cost of domestic facilities — without any sacrifices to the quality of the end result. While this yields cost savings from any production angle, businesses with more labor-intensive products are bound to see the biggest return on investment.
Lower Finished Product Costs
When you factor in material and labor expenses, products made offshore are likely to wind up with a reduced final cost. As production costs decrease, businesses can pass these savings onto their customers. The smallest reduction in price can lead to a higher volume of sales and a more satisfied group of customers.
There’s a lot of buzz around just-in-time (JIT) logistics, and that’s for good reason. Whereas companies tend to overspend on production materials (and wind up with waste) as well as fill their warehouses to excess, JIT logistics only focuses on the supplies you need now. Overseas manufacturers often leverage this approach to streamline the supply chain and reduce costs.
(While discussing supply chain costs, it’s worth mentioning the manufacturing tariffs in China. In an effort to evade this tariff, providers like Cases By Source are working with manufacturers in Myanmar and Vietnam.)
Quality Control Systems In Place
To effectively manage the production of large volumes of orders, offshore production facilities implement quality control systems. With proper guidelines in place to guide production efforts and built-in strategies to make revisions when needed, businesses can feel confident that the end result will meet their specifications. (As with domestic production, the quality of a product reflects the quality of the systems a manufacturer uses.)
While offshore production offers a variety of benefits, the choice between offshore and domestic production always boils down to your specific product needs. The great news is that we offer both at Cases By Source — and we can help you decide on which is the best option for your custom case needs. Connect with our team today to get started.
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