The High Cost of Outsourcing Manufacturing

Document Type

Other

Rights

Available under a Creative Commons Attribution Non-Commercial Share Alike 4.0 International Licence

Disciplines

5.2 ECONOMICS AND BUSINESS

Publication Details

RTE Brainstorm, Updated / Thursday, 14 Jan 2021 17:05.

Abstract

A product's lifecycle originates in a concept and ends in after-sales service. Many believe that manufacturing adds least value in that lifecycle and is disposable. That's a big mistake. Companies who outsource all manufacturing production to lower cost destinations typically do so to reduce costs. Such companies concentrate resources on activities that add value and generate more profit, following a "We Think, They Sweat" model. But future generations of design engineers in their home country pay a high price for any costs saved.

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