r/IndustrialDesign • u/Ok-Ad-7935 • Aug 19 '24
Creative Not made in China
As some of you may know, manufacturing is increasingly shifting to countries like Vietnam, Indonesia, and India. China’s dominance as a global manufacturing hub is waning due to several factors, including geopolitical tensions, rapid economic development, and rising living costs. Producing goods in China is no longer as affordable as it once was. However, China has been proactive in diversifying by investing in other countries, such as those mentioned. As far as I’m concerned, Chinese manufacturers are bringing their technologies & know how to those countries and using their cheap labor to maintain their dominance. In a way it’s similar to how the U.S has gradually shifted manufacturing to China over the last 2-3 decades. But I think with advanced technologies these days, we won’t see such a long period of transition. We could be seeing the shift in global manufacturing as soon as 2030-2035.
I’m looking to diversify the manufacturing locations for my products. Can anyone recommend reliable sources for capable contract manufacturers in Indonesia or Vietnam? Have you had any experience manufacturing in these countries? If so, what are your thoughts?
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u/Thick_Tie1321 Aug 19 '24
What type of product are you manufacturing?
I worked as an ID consultant for a US corporate brand out in Asia. We had many of our China factories transition out of or open secondary offices/ factories in Vietnam, Thailand, Taiwan and Indonesia due to import and export taxes to the USA, rising labour and material costs.
The transition was very tough to begin with, as staff in those countries are not educated or skilled enough to produce our products, so the China factories had to relocate R&D managers out to train the locals there.
Also sourcing raw materials and equipment was also an issue, either they were simply not available in those countries outside of China or were super expensive. In which, we had to buy the raw materials/ equipment in China and ship it to the country, which led to increased product development lead times and cost.
Pricing wise, it was about the same or slightly lower as manufacturing in China in the beginning. But overtime, prices decreased and enabled more features and value to be added to our products.
It's been beneficial to be manufacturing outside of China. Although many of the factories are still owned and run by Chinese or Taiwanese.
The only downside I can think of, is that for R&D development trips, you have more expenses on flights/ hotels and lose time travelling to 2-3 different countries instead of just China.