Manufacturing isn't dead (It was getting an MBA in customer service)
A new breed of entrepreneur is using technology and innovation to give clients a more personal product.
Fri, Nov 22, 2013 at 03:11 PM
Photo: Snapshot from Appalatch video
When Allen Robertson, vice president of sales at Capel Rugs, got a phone call from a client who had forgotten to order a braided rug that he needed shipped to him in two days, you'd have been forgiven for assuming it was too late. Many U.S. furniture manufacturers have moved their operations overseas, meaning long lead times are the norm for any such order.
For Robertson, however, the story was different.
"It was about 2 in the afternoon, so I ran to the plant and asked if we could make an 8 by 11 rug and still get it to UPS today," Robertson recalled. "We shipped it and it went to Hilton Head. The guy called me at 2 the next afternoon and said, ‘Cancel the order, apparently we had ordered it.' He didn't realize we did it and shipped it. We do have some service advantages."
While globalization may have wreaked havoc with many manufacturers, volatile fuel prices and rising labor costs in emerging markets mean that not all the cards are stacked against the little guys. The relative advantage of being close to market is also being augmented by new technologies like 3-D printing or print-on-demand technologies, which allow small companies to circumvent the economies of scale that were previously required.
Custom-made sweaters, built to last
Asheville-based startup Appalatch, for example, plans to make 100 percent custom-fit wool sweaters that are made to order for each customer. This nimble approach makes made-in-America clothing more feasible and reduces the fabric waste of conventional techniques:
Calling their new venture a "fad-proof" sweater that will be made to endure, the designers explain that with conventional manufacturing techniques, up to 30 percent of the fabric is wasted. With the Appalatch model, each sweater is made to order with the best quality materials so that customers "buy less, but wear it longer," as in the olden days.
Distributed manufacturing through a digital cobbler
Another fashion brand, Lyf Shoes, follows a similar concept, developing a distributed model of manufacturing it calls "the Digital Cobbler." Shoes are manufactured on-demand at a local shop and, at the end of their life, disassembled and their component parts reused to make new shoes. Here's how the company pitched the concept on its Kickstarter campaign:
A traditional craft finds its feet again
Nimble manufacturing is not, however, all about fancy new manufacturing techniques. Sometimes, it's more a case of new communications technology making traditional manufacturing on a smaller scale viable again. Take U.K.-based BioRegional Charcoal Company, for instance. Faced with imports, primarily from Asia, squeezing out traditional charcoal from sustainable "coppiced" woodland, the BioRegional Charcoal Company envisioned a different approach:
BioRegional’s network production model involves the central coordination of a group of producers that allows them to act as a single supplier. The network supplies high quality-charcoal, firewood and kindling to major retailers using the most local producer to each store.
The result, says BioRegional, is a reliable revenue stream for sustainable woodland management, not to mention an 85 percent reduction in shipping emissions when compared with imported charcoal.
Volatile labor and transportation costs
While evangelists for 3-D printing may envision a mini-factory in every bedroom, it seems unlikely that nimble, micro-manufacturers will entirely replace the big guys any time soon. They are, however, proving the point that in a global economy that all-too-often means a race to the bottom, ingenuity and innovation offer a different — and more compelling — path to remaining competitive. As Rob Cotter, founder of Organic Transit, put it when describing his own nimble manufacturing vision, it's not like the global players don't have their own disadvantages to worry about:
We’re watching the cost of Chinese labor and fossil fuels going up, while unemployment in the West is at critical levels. We’re riding that wave, and aiming to build a radically different business model that will keep our costs and environmental impact down.”
It seems Cotter is not alone. The age of the nimble manufacturer may finally be upon us.
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