In today’s competitive environment, OEMs are looking for opportunities to strengthen their supply chain while maintaining excellent product quality. To achieve this, many companies are relocating manufacturing closer to home – a process known as reshoring. Over the past several decades, many North American OEMs transitioned manufacturing offshore, typically to locations in Asia such as China, to take advantage of perceived lower costs and other anticipated benefits. Reshoring is the opposite of offshoring; and is simply bringing manufacturing back from overseas. While some costs such as labor may be lower with offshoring, many OEMs are realizing that reshoring is a much more competitive and attractive option when total cost of ownership and brand reputation are considered.

On-going global trade tensions, geopolitical instabilities, and the COVID-19 pandemic, have resulted in significant disruptions and strains on supply chains. To address these uncertainties, OEMs are seeking more localized suppliers to create a more robust supply chain with fewer risks – and reshoring manufacturing to the U.S. is an ideal solution.

There are many advantages to partnering with a contract manufacturer and reshoring with U.S. manufacturing. The following highlights the main benefits and makes the case for partnering with a proven and experienced contract manufacturer, like RiverSide Integrated Solutions (RIS), which has 3 state-of-the-art manufacturing facilities in the U.S. with distribution networks across the Americas. It should be noted that all of the advantages below result in production efficiencies and cost savings as well as lower supply chain risk for OEMs.

·Superior Quality: offshore manufacturing is known for its less expensive labor. However, offshoring often involves raw materials, tools, and equipment that are also cost driven, often leading to quality issues. A growing number of North American OEMs are looking for reduced quality risks and are seeking an alternative to offshore manufacturing. Reshoring with a U.S. contract manufacturer offers North American OEMs more reliable and higher-quality products, which translates to a higher value manufacturing solution with reduced risk. The U.S. has strict standards, and has earned a reputation for manufacturing very high-quality products for various industries. RIS, for example, is a contract manufacturer that is based in Minnesota and serves a wide variety of high quality products to markets worldwide.

·Excellent Proximity to U.S. and Canada: this is the most obvious benefit of reshoring to the U.S. but it cannot be overstated. OEMs must maintain control over manufacturing and it is much easier to oversee manufacturing when it is closer to home. As noted, RIS is centrally positioned within the U.S. where you can easily travel to most locations in North America in a few hours whereas most flights to Asia take a day. Additionally, the time differences across North America are very manageable, allowing similar work schedules between personnel and the manufacturing location. This is a huge advantage of partnering with a U.S. contract manufacturer, like RIS, compared to manufacturing in Asia where there is around a 14-hour time difference, especially when dealing with any urgent matters that cannot afford a delay.

Looking for a contract manufacturer that can reduce the level of risk and improve the reliability of your supply chain?

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·Streamlined Logistics: reshoring means that finished goods often only take hours to arrive in the U.S. or Canada compared to weeks from most Asian countries, resulting in transportation costs that are much lower as well as a lower risk of delays or damage during transit. This benefit has only been amplified in recent years, especially during 2020, as there have been significant travel and logistics delays with goods from Asia. Shipping costs skyrocketed in 2020, specifically container freight rates, due to logistics disruptions caused by the pandemic. Reshoring with a U.S. contract manufacturer streamlines logistics for OEMs, reducing the risk of logistics delays and cost spikes as well as securing brand reliability and consumer trust.

·Less Inventory on Water: as with all supply chains, reducing the inventory throughout the chain is key. For example, goods transported by ocean freight often have a lead time of at least 8 weeks, 6 weeks of which are spent on the water in transit. This scenario results in two big issues: 1) a discovered defect would require the recall of all the product in the supply chain, including the inventory on the water, and 2) volume adjustments due to demand fluctuations are slow and lag by around 8 weeks. A real-world example of these issues played out at ports across the globe; as a result of logistics disruptions caused during the COVID-19 pandemic, ports observed huge pile-ups of container ships that took months to resolve, resulting in massive product delays. Reshoring with a U.S. contract manufacturer, like RIS, solves the inventory on water problem by dramatically decreasing the amount of time goods spend in transit – improving speed to market and the ability to rapidly respond to changing market conditions and customer demands.

·Responsible Business: over time, companies have continued to put more emphasis on responsible and sustainable manufacturing where importance is placed on the conditions of the factory and the origin of raw materials. One of the advantages of partnering with a U.S. contract manufacturer is the value it places on its workforce and keeping them safe. Labor laws are enforced and there are limits on how many hours personnel can work each week and restrictions that ensure a safe work environment. Additionally, there are laws to ensure the quality and traceability of raw materials for manufactured products. Unfortunately, the same cannot be said for many countries in Asia. Therefore, companies can do business in the U.S. knowing the workforce is taken care of under the local laws and their reputation is not at risk.

Reshoring manufacturing to the U.S. offers many benefits and makes good business sense. The team at RIS are well-positioned and ready to serve as America’s reshoring partner. We employ more than 300 people and provide a myriad of manufacturing services to OEM’s across the world. Contact our team today to learn more about our range of contract manufacturing solutions.

About RIS

RIS is an advanced contract manufacturer providing robust solutions in circuit board assembly, product assembly, kitting, supply chain management, fulfillment, distribution, and reverse logistics. We employ more than 300 people and provide services to OEM’s across the world. We operate 3 state-of-the-art manufacturing facilities within the U.S, and as your one-stop-shop we have the capabilities, capacity, quality assurance standards, and resources to provide you with support for all of your manufacturing needs.

With all of the choices in contract manufacturers out there, we know it can be difficult to find someone that not only understands your business model but also has your best intentions in mind. RIS has proven to always be a win-win focused relationship. As your one-stop-shop, we have the capabilities, capacity, quality assurance standards, and resources to provide you with support for all of your manufacturing needs. We understand that supply chain management is difficult and very time consuming, so we urge our customers to utilize us in the fullest capacity. Our total-package solutions include:

· Extensive supply-chain network

· Purchasing and inventory management

· Dedicated Program Manager

· Warehousing and drop-shipping capabilities

· Flexible order fulfillment

· Product assembly: sub-assembly and full product

· Scalability to meet your needs

Contact us today at (507) 523-3220 to see how we can help with your manufacturing project, or click here for a quote.

Why Reshoring Manufacturing to the U.S. Makes Sense
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Why Reshoring Manufacturing to the U.S. Makes Sense
Why reshoring manufacturing to the U.S. makes sense - lower supply chain risk, superior product quality, streamlined logistics, and more responsible business.
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RiverSide Integrated Solutions
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