What are the true costs of offshoring?

Companies are realizing that costs, risks and the business impacts of offshoring are great enough to take a closer look at reshoring many of their manufacturing practices. The United States remains the world’s largest manufacturing market and there are many advantages to producing here at home.

The top business reasons companies decide to reshore are to:

  • improve lead times,
  • gain higher product quality and consistency,
  • control the costs of rising offshore wages and freight,
  • utilize a more skilled workforce,
  • decrease inventory levels,
  • improve responsiveness to ever-changing customer demands,
  • minimize risks to intellectual property and regulatory compliance,
  • benefit from improved innovation and product differentiation, and
  • capitalize on local tax incentives.

According to the Reshoring Initiative, most companies make sourcing decisions based solely on price, oftentimes resulting in a 20 to 30 percent miscalculation of actual offshoring costs. To truly determine the total cost of ownership, companies need to account for all relevant factors associated with their business operations. Some of these factors may include company overhead, financials, risks, corporate strategies and other various individual business considerations. By carefully analyzing this information as a whole, companies will be able to better evaluate their sourcing, identify alternatives and use it as a differentiator when selling against offshore competitors.

There are many resources available to companies who have a desire to evaluate their reshoring benefits. Our Badger Alloys team is ready to help. As a Badger Alloys customer, you will receive the highest quality product, service and support. We strive to create and maintain a partnership with each and every customer.

Meeting your aggressive delivery requirements and providing exceptional service are at the core of our company’s mission. This mission is understood and embraced by every member of the Badger Alloys team. Contact us for more information on how we can help with your next project.