Major supply chain issues have been witnessed across the globe over the past few years, both because of significant labor shortages due to the COVID-19 pandemic and the massive increase in demand for various goods. And that’s not even mentioning the enormous strain the distinct lack of equipment and space has put on the struggling market.
Many products are becoming much harder to obtain, from exercise equipment and computer chips to breakfast cereals and paper products. Meanwhile, the global supply chain is struggling to avoid devolving any further. Thankfully, there’s a practical solution to many of these issues; domestic production.
While the idea may leave many international corporations balking, the production of goods on a domestic basis is one of the best possible ways to help solve the current global supply chain hangups; at least until we’re finally able to get back to a state of normalcy in the wake of Coronavirus. Please continue to learn how domestic production can be a crucial solution to our current supply chain issues. Please also consider browsing through the range of educational articles provided by our experts at Plant Switch.
The Current State of The Global Supply Chain: What You Need to Know
Because of the massive problems caused by the pandemic, factories of all kinds across the world have either closed or experienced significant cuts in their workforces, resulting in a lowered ability to produce enough products to meet the rising demands of global consumers. However, the supply chain issues don’t end at the factory doors. They only represent the start of the problems that international markets are currently facing. If anything, the primary issue seems to stem from the issues popping up in the realm of product shipping and transport.
According to reports, two of the largest ports in the United States have seen a 30% increase in goods going through them regularly, yet their forced to process said goods with as much as 28% fewer workers. In addition to that, up to 77% of the world’s largest ports are still facing significant backlogs, and things are only predicted to get worse before they get better.
How is Domestic Production a Viable Solution?
While domestic production of goods won’t solve all of the problems currently wreaking havoc across the supply chain, it should at least help mitigate some of the more prominent issues, especially when it comes to the transportation of products. Goods manufactured domestically don’t have to travel nearly as far or be handled by as many people to reach their intended destination. They also provide the massive benefit of bolstering economies that can more effectively withstand global competition. These are two primary reasons the current presidential administration is endeavoring to revitalize and rebuild more vigorous domestic production efforts. However, they are far from the only benefits that domestic production provides.
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What are The Top 7 Benefits of Domestic Production?
Aside from the key points noted in the above section, domestic production of goods also allows for seven other primary advantages, including;
1. Enhanced Flexibility
International and offshore productions focus primarily on high-volume manufacturing. However, domestic production allows for smaller production runs, allowing businesses to operate at a more comfortable pace while reducing the potential for wasted inventory. It also allows them to offer more flexible financing terms for payment and shipping methods.
2. Streamlined Communications
Long-distance communication tends to be frustrating, primarily when it’s occurring on an international scale and between multiple time zones and languages. Domestic good production can allow businesses to avoid these particular challenges and prevent delays in feedback or addressing specific concerns. Working within the same or similar time zones and with a singular language also helps avoid communication breakdowns.
3. Reduced Shipping Costs
Overseas manufacturing typically comes with some hefty shipping costs, primarily to offset the losses caused by lower labor and production costs. Domestic shipping, however, is much less expensive and significantly reduces the amount of travel time the product has to undergo to reach a specific consumer or the display shelves of a particular business. Domestic shipping also removes the presence of costly international taxes and customs fees.
4. Positive Press
The well-known “Made in the U.S.A.” label is an element that’s highly appreciated in the eyes of patriotic consumers for a comprehensive list of reasons. It’s not only a sign that the product in question creates more American jobs, but it also feeds the commonly-held belief that American-made products are of superior quality. This leaves many consumers more eager and likely to purchase domestically produced products.
5. Shorter Lead Times
Speed-to-market is an important metric that can help businesses stay ahead of competitors and allow them to get their inventory into the hands of eager consumers much faster. Domestic good production allows for significantly shorter lead times that don’t leave businesses waiting for new products to arrive and cause them to put off essential sales.
6. Elevated Levels of Quality Control Standards
Domestic manufacturing facilities often pride themselves on their high-quality production and labor standards. Domestic products often feature high-quality construction with fewer design issues, which is another reason why they’re often preferred over their internationally produced counterparts.
7. Higher Environmental Sustainability
Domestic goods don’t have to traverse massive distances to reach the hands of consumers, which is a significant benefit for those looking to buy goods that are better for the environment. Customers are growing more environmentally conscious as time goes on, making domestic products’ ecological benefits much more appealing than their international alternatives.
Final Thoughts and Considerations to Keep in Mind Going Forward
The global supply chain is currently experiencing some significant issues that are not anticipated to go away at any point soon. Thankfully, the production of domestic goods may be what we need to start curbing these issues and get back on track to developing a better, more resilient economy, as well as a healthier, cleaner environment. If you’d like to access more information on other essential components of promoting a healthy environment and natural sustainability, please consider checking out the articles and products proudly offered by our experts at Plant Switch today.
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