Bring Your Supply Chain Closer to Home
BCEDC has been participating in a regional effort to help bring back business lost off-shore. Just as it is hard to quantify the extent of damage Bucks County companies have experienced, it is even harder to raise business leader awareness to a level they feel capable of doing something about it. The most common response to the question, “Do you want help re-shoring lost business?” was, “It’s almost impossible to get work back from Asia once it goes off shore. Even if I had a plan, I don’t have the money to finance the necessary changes.”
Digging deeper, the same leaders express the following major barriers to even considering taking action to bring off-shore business back to the region:
• Affording the technology improvements needed
• Creating a marketing plan and re-building a new supply chain
• Financing the raw material purchase and WIP build-up that their old customer has no interest in supporting because they have already incurred the cost of going off-shore.
Just one of these reasons is enough to discourage taking up the re-shoring challenge. However, even with sketchy data, the problem is so serious that taking no action is not a good option. While no easy answer exists, alternatives and potentially helpful solutions are in place.
The SE region has more advanced technology available to local businesses than almost any other region. Affordability and awareness present the biggest challenge to access it. BCEDC, Team Bucks and the Manufacturers’ Alliances of Bucks and Montgomery Counties are in place to help find the specific technology needed to address the cost cutting requirements to re-attract the old customer. These organizations are also able to suggest various cost-sharing strategies to help fund the advancements.
Developing a re-shoring business plan is critical to determining the scope and level of financing required and the extent of the supply changes needed to support the manufacturing process. The need for providing assistance with such a plan has been recognized and the region has secured grant funding to address it. The grant is called RAMP-IT-UP and the BCEDC has partnered with Team Bucks to provide an informational event highlighting the services and expertise available to businesses wishing to develop a re-shoring strategy. One of the team partners, DVIRC, has created a Total Cost of Ownership model that will help educate the company and its customers about the hidden costs of long supply chain, long-distance product change requests and a myriad of other landmines existing below the surface. Please see event details below.
Article written by Greg Olson, Director, SE SEWN Region, 215-776-0130, Sewnse@steelvalley.org, www.steelvalley.org.