

The Myth of China’s Manufacturing Prowess - cwan
http://helenhwang.net/2010/03/myth-of-manufacturing/

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bokonist
She is comparing the manufacturing output of the U.S. and China in dollars,
not actual quantity of stuff. But China is engaging in a policy of actively
devaluing the yuan relative to the dollar precisely in order to prop up
manufacturing and exports. Thus the quantity of China's output may actually be
considerably greater than America's, but the _price_ of the output may be
lower due to China's weak currency policy.

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Perceval
True, but on the flip side, demand for China's goods might be significantly
lower if they weren't manipulating their currency. If their goods had a higher
valuation from being priced in a more valuable yuan, the demand would probably
fall. I guess we have to wonder whether it's _politically_ more important for
China to sell high volume/low price or eventually more to medium volume/medium
price.

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fnid2
The difference between the US and China is _automation_. Same is true of
India. I've sent designs overseas that can be made by hand cheaper than they
can be made in the U.S. with machines.

In this respect, off shoring manufacturing enables a greater range of
innovation at much lower risk. I can build 1000 widgets overseas for $1 each,
but I can't even _get_ 1000 widgets in the u.s. due to the cost of the
machines to make them.

The reason the US is still the powerhouse of manufacturing is because they
manufacture simple and common devices like screws, springs, etc with machines.
These devices have been used for decades and a market has been established for
them.

The devices, many of them anyway, made in china are on the edge of innovation,
whereas the items from the U.S. are older commodity items used in many
devices, that is, components of complex devices, rather than the complex
device itself.

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iskander
>In this respect, off shoring manufacturing enables a greater range of
innovation at much lower risk. I can build 1000 widgets overseas for $1 each,
but I can't even get 1000 widgets in the u.s. due to the cost of the machines
to make them. >The reason the US is still the powerhouse of manufacturing is
because they manufacture simple and common devices like screws, springs, etc
with machines.

Your claims strongly contradict my experience. I worked for a manufacturing
school in Chicago and learned a bit about the machining/manufacturing market.
In the Chicago area alone there are thousands of computerized manufacturing
shops on all scales. The smaller shops are often a dozen Polish guys, some CAD
software and a few CNC machines. They will happily make your 1000 widgets.

These shops survive specifically because Chinese manufacturing only deals with
massive volume and is not nearly as reliable. They _don't_ make "simple and
common devices" but rather complicated parts for cars, airplanes, consumer
devices, pieces of larger scale manufacturing equipment, etc...

edit: I see from your other post that you work with textiles-- that's probably
a very different market than the precision parts manufacturing I'm familiar
with.

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lfgmikujhygfv
>I see from your other post that you work with textiles

There is a Spanish high st fashion chain that specialize in very lean
manufacturing, if an item becomes unpopular they don't sell it the next week.
An new item takes a couple of weeks from design to the stores. Rather than the
annual cycle in most textiles

They manufacture in europe, but make money from never making an item that
doesn't sell.

~~~
blrgeek
<http://hbswk.hbs.edu/archive/4652.html>

Zara supply chain ---> mass-manufacturing * lead-time Vs lean manufacturing *
cost

Applies to almost all industries. Difference is if you want a million of the
same thing, or thousand of a thousand things.

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aresant
This blog post, recently on HN, does a great job showing the Chinese approach
to manufacturing including videos of some of the high-skill workers:

<http://www.bunniestudios.com/blog/?p=185>

