For many Americans seeing the words ‘Made in China’ represent not only a displeasure, but often a down right disdain.  For companies that are able to produce products in America it has become a badge of honor and pride.  Often a mistake inventors make is getting swept up in their love for America so much so that they manufacturer their product here at any cost.   Don’t get me wrong if it makes business sense (and cents), then absolutely, America should be the first option taken.   Most of the time however, the choice to produce in America leaves small independent entrepreneurs over-expensed, with a debt hole difficult to dig out of.

Take for instance my BedPost Shelf invention, like all good entrepreneurs I wanted it to say ‘Made in the U.S.A.’.  When I received the tooling price and price per unit for production in America my jaw dropped.  I knew I couldn’t afford it.  What’s maybe worse is that if I could afford it I would have had to sell 10,000+ units just to cover the cost of the tooling.  At the time China seemed so foreign and anyway I couldn’t wrap my brain around the possibility that the cost could be that much less.

With going direct to China seeming too foreign, I contacted a U.S. Sourcing company who had contacts in China.  When the price came back I thought they were kidding.  My entrepreneurial dreams were again alive!  The tooling was 1/6 the cost and the price per unit was ½ the cost it would have been to produce in America (included shipping expenses to U.S.).  Not only could I afford my invention I could also offer it to consumers and retailers at a price that wouldn’t get laughed at.  Even if I could have afforded the U.S. price I would have had such a high retail price that sales would have been slim to none.  If us as consumers while we shop look at a product and say, “That looks like a useful invention, I am willing to pay this high amount because I see it is made in America”, then maybe it could make sense to purposely pay more for U.S. manufacturing.  However, (and I have seen it with Yak About It featured inventions) what is often said by us as consumers is; “That looks like a useful invention, but it is priced too high and I’m not willing to pay that much.”

Instead of looking at manufacturing jobs lost, inventors and consumers have to look at all the jobs gained.  By being able to produce in China not only was I able to start and sustain my invention, it has also lead me on much larger entrepreneurial path.  By utilizing one piece of the equation (manufacturing) overseas I have provided income and/or jobs in customer service, accounting, finance, warehouse, freight, packaging, information technology, design, marketing, PR, engineering, and sourcing.  That doesn’t even count a host of other industries that have benefited from my entrepreneurial endeavors such as travel, food, entertainment and more.   If I chose to manufacturer in America I would not have been able to support so many industries and employees.  The point is Americans gain more by entrepreneurs seeking to source overseas.

Since my early maturation I have become such a believer in this concept that I took it upon myself to go direct to China for manufacturing, which reduced my cost another 50% by dropping the U.S. sourcing company.  I have also gone a step further and for the past 4 years I have been self teaching myself Chinese in my spare time to get a greater understanding and communication with my contacts.  This is not necessary, but it sure helps.  It helps for all the obvious reasons and for the less obvious reason of reducing risk.  All start-up entrepreneurs fear getting a container of poor product, the fear is disconnect resulting in a bad shipment.  (With the advent of testing companies this should no longer be a fear.)

For start-up entrepreneurs that have an invention made of plastic that needs to be sourced check out www.china-arun.com and / or email jeff@yakaboutit.c0m

This entry was posted on Monday, October 12th, 2009 at 8:33 am and is filed under Sourcing & Prototypes. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.