First off, the domestic supply chain isn’t all bad. There’s certainly something to be said for US-based service partners, local warehouses in the US (to hold your products a day away until you need them), and English-fluent support.
But beyond that, the domestic supply chain is a disaster right now.
Your Domestic Suppliers Are Short On Materials
If the worldwide disruptions of the past few years have made anything clear, it’s how much domestic suppliers and manufacturers in the US actually depend on international sources for materials. The materials stage of the supply chain has mostly been offshored over the last 30 years, and now it’s hard for suppliers to find what they need inside the US to make your products.
HBR used the example of Shawmut, a US-based maker of N-95 masks needed during the pandemic. They ran into extreme material supply issues because there are barely any domestic sources of needed parts — melt-blown fabric, moldable cup materials, elastic straps, and specially coated aluminum strips (for the nose bridge) — remaining in the states. Of those that remain, the capacity just isn’t there.
Where Are the Workers?
Domestic suppliers are also struggling to field a sufficient workforce to keep up with demand. The Great Resignation has taken a major toll on the domestic supply chain, with US-based factory workers demanding sharp increases in their wages and many choosing not to return to work at all even as the pandemic recedes. This has wreaked havoc on lead times, which we’ve seen extend 4, 8, 12 months or more for orders so simple as caps for spice jars.
Domestic Prices Are Sky High
Prices have steadily marched upwards to keep up with the higher cost of doing business in our heavily disrupted economy. Those lost margins are squeezing small and midsize brands more than anyone, as the global leaders throw their weight around and get priority pricing and delivery times with massive orders — accounts that domestic suppliers can’t afford to lose.
It’s Time to Go International
There’s a way out of the long lead times, high prices, and unreliability of the domestic supply chain. The world’s leading global suppliers are faring better with fielding a sufficient workforce, and have more access to critical materials from other suppliers local to their factories. Prices, as much as they have risen, are also still lowest overseas.
When you go global, you enjoy the many advantages of international sourcing:
- Accelerated lead times
- Recoup those lost margins
- Products more likely to be in stock
- Many supplier options to choose from
It’s not all roses, though. If you’re going it alone in the wide world, you may have to navigate common challenges of global sourcing, including:
- A lack of customer support and service
- Language barriers
- Low transparency into the supplier’s factory
- Unfamiliar purchasing processes
- Complex shipping and importing options
The reasons for global sourcing are pretty compelling, but is it worth the extra trouble?
The Best of Both Worlds
Fortunately, there’s a third way. You can go international and escape the domestic supply chain without sacrificing quality, transparency, or clarity. A strategic global supply chain partner can provide white-glove service and facilitate your connection with top global suppliers — and no hassle.
ABC Packaging Direct — The Oversea Network helps you leverage global sourcing opportunities with a local approach. We provide every partner with a dedicated oversea team and expert boots on the ground, both here in the states and abroad in your preferred international factories. Our team shepherds every project from end-to-end, from the factory to the inspection lab to your doorstep, with a 100% quality guarantee.
You’ll have benefits typically reserved for domestic supply chain partners, including a local, English-fluent main point of contact in our US-based office and domestic warehouses where we can store all of your products just a day away until you need them on-site. And we don’t charge for warehousing!
At the same time, you’ll enjoy access to a fully vetted network of leading global suppliers and expert guidance and supervision within the overseas supply chain. Stop worrying about language barriers and meeting spec. We ensure everything moves along smoothly and your products are up to par and shipped on time through the most cost-effective and reliable channels available.
It’s truly the best of both worlds.
Get in touch with the ABC Packaging team today to escape the domestic supply chain and get cost-saving, time-saving results from relationships with high-performing global suppliers.
