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Shipping Costs Impact Globalization
August 4, 2008
Yesterday's Sunday New York Times had a front page, above the fold article about how shipping costs are impacting globalization. In some cases companies are bring manufacturing work back to the U.S. due to these costs. And some international companies, strong in the U.S. market, are opening manufacturing facilities in the U.S. to satisfy the domestic market due to high shipping costs. Home furnishing manufacturer Ikea was given as one example.
Granted, global outsourcing is not going away. It makes sense…..in some cases. But it doesn't make sense in all cases. Astute readers may remember a recent post where a friend of mine said that the cost of shipping from Asia exceed the cost of materials in the boxes, and his company was about to recalculate the global sourcing equation. Seems like others are doing so as well.
Posted by Richard G. Weissman on August 4, 2008 | Comments (1)
In response to: Shipping Costs Impact Globalization
Ravi Nilakantan commented:
Unfortunately we cannot please everyone. Our loyalty is always to our employer and to our country the United States of America. Bottom line cannot be ignored in taking major decisions. We have to factor in shipping costs in the equation before we move forward in manufacturing decisions. Best thing is to develop a templet or an electronic form that needs to be filled in and then make sure that all the costs are taken into account before we sign on any dotted line. Countries that do not support Human Rights need to be addressed with adequate cooperation of management of course. Business ethics/Fairness is very important as members of a civilized world that we need to follow when we do something of such importance. I hope that my input is useful to someone. Ravi