unclechina.org

Factors including exchange rates, transportation costs and small volumes are bringing some outsourced manufacturing back to the U.S. from China according to this report in the San Francisco Chronicle.  Labor and materials costs have risen to an extent in China that for low-volume high-value production runs many US manufacturers are pulling orders out of China and giving them to their fellow Americans.

One cost of outsourcing to China that is not mentioned in the report and is often overlooked by US outsourcers is the cost of unforseen problems such as broken contracts, poor quality, returns, stolen IPR, etc.  It’s difficult to figure these costs but they are very real.