Any business that manufactures a product needs to consider whether or not it is a smart move to manufacturer the product or parts overseas. While there are some benefits to making a product domestically, you will find that there are a handful of advantages to overseas manufacturing such as reduced costs, greater variability, and high-volume capability. Additionally, in today’s day and age it is easier than ever to do business abroad, so it is something that is not restricted to large, multinational businesses. While it is something that should be considered, you must also make sure that you are aware of and comply with overseas manufacturing laws.
Research & Visit The Factory
Much like you would if you were going to outsource manufacturing to a domestic company, the first step should be to fully research any manufacturing companies that you consider to make sure that they are legit and above board. You should also visit the factory and meet the people that will be making your product – this is helpful for building relationships but also checking that everything is legal.
Learn Local Manufacturing Laws
Once you have decided on an overseas manufacturing plant, you will then need to familiarize yourself with their own national laws in regards to manufacturing and make sure sure that you set your own environmental and safety standards that are within these laws. This will help to ensure that the product is being manufactured legally and to your own set required standards back home.
Maquiladora Factory
One good option to consider is maquiladoras in Mexico – this is a factory which is able to operate under preferential tariff programs established by the US and Mexico. This enables you to bring in production materials, machinery and components into Mexico duty-free, plus labor in Mexico is affordable with custom fees, taxes and tariffs all much lower. Additionally, Mexico’s close proximity to the US is beneficial and allows you to easily visit and keep a closer eye on operations with a shorter distance to send the product or part.
Use Qualified Advisors
Manufacturing a product or part overseas can be an intelligent move for a business, but it will always bring complications especially when first starting out. It is for this reason why it is a smart idea to hire a qualified advisor who will be able to oversee the operation and help you to deal with issues which you might not have considered, such as operational or cultural challenges in the particular country. These advisers will also ensure that everything is legal and above board so that you have peace of mind knowing that you are operating legally.
There are many perks to manufacturing a product or parts overseas, and this is easier than ever in today’s day and age. While there are many advantages and it is certainly something that is worth considering, it is also important that you make sure that you are abiding by overseas manufacturing laws while still meeting your own required standards. This is a unique challenge, but the above tips should help any business to abide by the law and enjoy the perks of overseas manufacturing.
