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|Articles - October 2013|
|Monday, September 30, 2013|
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Though many of Oregon’s bread-and-butter manufacturers operate in hole-in-the-wall spaces most locals don’t know about, the global marketplace pits them against large overseas companies that rely on high-volume transactions and cheap labor.
As the last company in the U.S. producing whisks for restaurant suppliers and kitchen supply stores, 14-employee Best Manufacturers in Portland competes against large distributors importing from China that offer both bulk discounts and a variety of kitchen products along with the wire whippers.
“Stores and restaurant suppliers want to buy 100 different items from the same company, not each item from a different company,” says owner John Merrifield. For Best products to even make it into stores, he says, “at the corporate level, someone has to care whether they’re buying an American-made product.”
Though globalization applies constant pressure to gritty Oregon manufacturers, the forces that work against them — namely, their often diminutive size and Oregon location — can work to their advantage too.
Specializing in the harnesses that hold the engine wires of industrial or military transportation equipment, the 40-employee AmFor Electronics in Portland often finds itself beaten out by larger companies in Mexico. Still, AmFor has been able to leverage its U.S. location to win back clients.
“Our per-piece price is higher, but companies are getting more savvy to looking at the entire process from start to finish,” says Jesse Oliver, president of sales. When they consider the possibility of smaller lots, shorter lead times and quicker fixes to quality issues, they realize the total cost of a stateside manufacturer can actually be cheaper. “The challenge is finding those companies that see the value in the total landed cost methodology,” Oliver says.
Don Riddle of Applied Plastics Machining in Portland also builds his business on advantages farther-flung companies have a hard time achieving. In his 12-person machine shop on a recent afternoon, one employee attached wheels to the base of a clear plastic jeweler’s stool, a second screen-printed a logo onto a gas station snack-food holder, and a third flame-polished the edges of a Plexiglas cake riser that will eventually display Jockey underwear.
Riddle often works 60 to 70 hours a week and, if necessary, tears over to the UPS distribution center at midnight to ensure his clients prompt deliveries. “We’re too flexible for the big guys,” says Riddle. “If you need something at 3 o’clock this afternoon, I can do that. No manufacturer in China can do that.”
Pacific Overhead Door (PACDOOR), just around the corner from Applied Plastics, adjusted its business model to similarly take advantage of its edge. Years ago, the company sold $200 mass-produced garage doors, but realizing that large national corporations were better equipped to satisfy mainstream demand, it began offering $2,000-plus carriage-style doors specifically tailored to customers’ needs.
“We are constantly under assault by outside competition all over the country,” owner Steve Harris says. “They sometimes can sell commodity doors at a cheaper price, but they can’t sell custom doors and provide custom services nearly as competitively as we can sitting in our Portland home base, selling to people in the Portland metropolitan region.”
While outsourcing has long been a no-brainer for companies looking to increase profit margins, Scherer says, that is changing. ”The gap in what the true costs are of producing in the U.S. versus offshore is narrowing. For a while it was such a wide gap: Something that cost a buck here was three cents there.” But as American productivity stays high and Chinese wages increase, “it’s no longer an automatic decision,” he says. “This is affecting even the littlest guys.”
Thursday, February 27, 2014
BY ERIC FRUITS
Because they have little chance of working for someone else, today’s teens need to be entrepreneurs. But, first, we must teach our teens that entrepreneurship starts small.
Monday, March 03, 2014
Check out interviews with employees from some of the 100 Best Companies to Work For in Oregon winners and find out what makes their company a great place to work.
Tuesday, February 25, 2014
BY SOPHIA BENNETT
The coastal town of Coos Bay appears poised to land every economic development director’s dream: a single employer that will bring hundreds of family-wage jobs and millions in tax revenue.
Friday, April 04, 2014
BY ERIC FRUITS
The rapidly rising cost of higher education has left even the smartest researchers and the wonkiest of wonks wondering what’s happening and where’s all that money going. More and more, prospective students—and their families—are asking: Is college worth the cost?
Friday, March 28, 2014
BY TOM COX | OB BLOGGER
The next mysterious (or disastrous) event could be one that you or your team might suddenly need to respond to, probably under intense scrutiny.
Tuesday, February 25, 2014
BY LINDA BAKER
Les Schwab has put a premium on customer service since 1952, when legendary namesake Les Schwab founded the company with one store in Prineville. (Schwab died in 2007.) But if the corporate principles remain essentially the same, the world around this iconic Oregon business has changed dramatically.
Thursday, April 17, 2014
BY JASON NORRIS | OB BLOGGER
The “polar vortex” of 2014 seems to have finally thawed and we believe this change in weather will bring more sunshine to the U.S. economy as well.
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