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Made in the USA . . . Again!?
November 29, 2007
I am anticipating a potential renaissance in US factories producing toys. The numerous quality, pricing and logistics problems emanating out of China as well as the steady decline in toys sales seem to mandate a serious reconsideration of how and where we produce toys for the world's children. So it was with interest that I watched a piece about American manufacturing last night on PBS’s News Hour with Jim Lehrer. Entitled, “Midwest Rebound,” it looks at, believe it or not, an ongoing recovery in rust belt manufacturing.
The show caused me to think about the US toy industry’s virtual abandonment of American sources of supply and the subsequent impact on the industry. In retrospect, it appears that US toy manufacturers chose to forgo investing in U.S. plant, equipment and labor and instead chose to take advantage of lower labor rates in China. This was an idea that, though probably not the best for some American workers, certainly made sense in terms of producing toys for American consumers at highly attractive retail prices. Frankly, it worked, and it worked well, for a number of years.
I wonder though, if by avoiding investing in plant and equipment, and in particularly skilled labor, we unintentionally took our industry from one of high innovation and play value to one of status quo and lowest price. Maybe this is why toy sales have generally been in decline for several years while industries with innovative products like children’s consumer electronics have soared.
The PBS show talks about “High Road Manufacturing.” This is a manufacturing concept that seeks to produce irreproducible products through the use of a highly skilled labor force and high tech, proprietary equipment. Under this concept, you don’t have to be the low cost leader if you are producing great product that no one can knock off. And if and when they can knock it off, you are already working on the next best thing.
Maybe its time for the US toy industry to take a hard look at “High Road” manufacturing as a means of not just regaining control of the supply chain but as a means of returning to an industry that is the innovation leader in play.
Posted by Richard Gottlieb on November 29, 2007 | Comments (1)
