Much buzz today about Apple’s decision to bring some Mac manufacturing and assembly back to the US from Asia. A smart move from a company that likes to take the lead, but one that is likely rooted in PR and marketing more than manufacturing. Details here from the WSJ. This will be a small test with little financial risk from an enormously wealthy company. However, it could be the beginning of a positive trend with multiple payoffs. Apple didn’t become the most valuable company on earth by being dumb or a follower. And, CEO Tim Cook’s expertise is in manufacturing/supply chain management and he appears to be leading the move.
There is clear evidence that labor costs in China are rising very quickly (17% a year, see chart below) while they remain flat in the US.
The significantly lower cost of labor was the driver to move jobs to China as the other factors such as shipping expense; language barriers, quality control and the fact you are dealing with a communist government make it less than optimal. Additionally, there is considerable political backlash and overall bad feelings about off shoring jobs while the US is in the midst of a four-year economic stagnation of low GDP, income and job growth.
The marketing and PR upside of “on-shoring” can be significant. We are a recession weary country that just came through a divisive and negative campaign. News that jobs are coming home will be seen as a breath of fresh air to US consumers. More companies should be exploring the option to bring some manufacturing back to the US for a few good reasons:
- “Made in the USA” can be differentiator against your competitors
- Bringing jobs back to the U.S. is a great PR hook for earn media placements.
- Provides a feel good story to build a content marketing/social media campaign around.
- The concept Henry Ford made famous – by creating good jobs you create a market of customers for your products.
If you are currently manufacturing in the US, your marketing should be integrating this fact into your messaging across all communications. While it may seem mundane to you, the fact may resonate with customers and prospects.
The time is right to study such a move. Ask Samsung and Google, no one ever went broke copying Apple.
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