Many UK companies that currently import components into the UK believe that they should be looking at a reshoring programme. The right incentives are definitely in place, so what exactly is stopping them?
UK plastic processors can easily demonstrate equal or superior technical competence to their overseas counterparts; the challenge is conveying to potential customers the many real benefits that reshoring can bring, despite the initial pain of the transition period.
This blog is designed to identify the pain points that are regularly used to justify leaving things well alone, then counter these arguments using knowledge gained from real-life scenarios.
Reason one – Lack of knowledge of the UK supply chain
This one might be hard to own up to, but the reality is that a lot of buyers have grown up with the idea of sourcing plastic components from lower-cost economies. They will have very few established lines of communication with potential UK suppliers, so will find it challenging to get suitable quotes.
Visiting exhibitions that focus on sub-contractors looking for new customers is one solution to this dilemma. The only negative is that relatively few such exhibitions take place, and exhibitors come from very varied backgrounds; usually, only a handful specialise in plastics.
Directories are a good starting point, but there can almost be too much choice! You will also need to match your requirements with the particular capabilities of the suppliers listed, which can involve a lot of trial and error.
ou are, however reading this blog on the PlastikCity site. PlastikCity is a procurement site explicitly designed to meet the needs of the UK’s plastics sector and companies looking to get stuff made in plastic. Within the primary Source a Moulder section, companies are listed by speciality, and their profiles provide details of their capabilities. More importantly, these companies have been pre-vetted to make sure they are financially secure, operate to the relevant quality standards and have the interest and skillsets to work with you. Our categories are limited to a number of selected, high-quality companies, and our team can also help you to narrow down your choice before you use the automated system to submit enquiries to your shortlist.
Reason two – Item cost price
Labour costs are significantly lower in some parts of the world, so UK companies won’t be competitive!
In reality, unless there is a great deal of labour-intensive assembly work involved, then by factoring in the true, real-life costs of importing goods over great distances, it is easy to counter this argument:
UK processors are leaner than ever, using the most energy-efficient production equipment and automating part handling, wherever practical to do so.
Transportation costs and the associated environmental impact are significantly reduced. You are also less susceptible to uncontrollable events such as political uprisings or severe weather at sea!
There is no requirement to ship full loads to minimise transportation costs, which leads to much lower stocking levels and reduced exposure to quality issues.
There is an option to use RTP rather than cardboard packaging, reducing long-term costs and your carbon footprint even further.
No concerns over import tariffs or a poor or fluctuating exchange rate.
Reason three – Ownership of production tooling
Ownership is a common issue. The ‘helpful’ overseas supplier offered to assist with the design of your product, then absorbed the cost of the production tooling. At the time, this seemed like a perfect solution and a lot less stressful! In reality, you now feel irreversibly tied to your current supplier, as you don’t even have the part drawings to allow the production of new tooling!
Technology can come to the rescue with this one! By using either CNC measuring or 3D scanning equipment, a current sample can be digitised and used to manufacture a new production tool. OK, so there is a cost to having new tooling manufactured, but there are ways to recover this cost:
A good UK toolmaker (even when managing overseas tooling production) can produce a tool that will produce superior components at a higher production rate. This lowers labour costs (no re-working needed), reduces scrap production, and lowers piece price at the same time as increasing the product’s appeal.
Product design changes and upgrades can be incorporated, helping to refresh your product range. Going forward, it will be much easier to make modifications, without having to worry about planning for long term disruptions to your supply chain.
The size of the tool can be optimised, allowing a smaller production machine with a lower hourly rate to be used.
Your new tooling can be put into full production when you are ready to make the switch. There is no need to worry about having to build up a buffer of stock using your probably disgruntled overseas supplier.
If you are involved with the procurement of any type of plastic product, then come and visit the PlastikCity Source a Moulder section. Here you will find over 30 of the best UK plastic processing companies, profiled by their capabilities and specialities. All these companies have invested heavily in machinery, automation and people over the last two years.
You may be surprised how competitive these companies can be, especially when the cost of logistics, cash flow, stock control, response times and resolution of quality issues are taken into account. When you also factor in the carbon footprint and the ‘Feel Good Factor’ associated with ‘Made in Britain’ on the label, you may be very pleasantly surprised.
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