LONDON--(BUSINESS WIRE)--A well-known market intelligence company, Infiniti Research, has announced the completion of their recent article on critical challenges facing small manufacturing companies in the U.S. This blog identifies the key issues facing small manufacturing companies in America and also discusses strategies to overcome them.
The U.S. manufacturing industry stands at a critical point in its long history wherein the future of the big and small manufacturing companies will largely depend on how effectively industry leaders formulate and implement strategies to adapt to the changing landscape. Small manufacturers in particular face a fair number of challenges such as competition from large domestic businesses in the U.S. as well as from other global players. With significant shifts in the technological, demographic, and economic landscape, small manufacturing companies must innovate themselves in order to stay competitive.
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Challenges faced by small manufacturing companies
Competition from foreign companies
American manufacturing companies are currently facing steady competition from several players around the globe. The competitive pressure is particularly high from Asian countries such as China, where equivalent products can be produced at a much lower cost when compared to the U.S. The low labor costs in countries like China also enables manufacturers to produce and sell at extremely low prices.
Regulations and compliance issues
Labor costs and stringent government regulations are making it tougher for small manufacturers in the U.S. to compete with the offshore counterparts. As the U.S. government is also constantly changing their regulatory and compliance policies, it can force small manufacturing companies to spend even more on monitoring compliance.
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Increasing quality of offshore manufacturing
A decade or two ago, the foreign quality of production was poor when compared to the U.S. However, now not only are the products manufactured outside the U.S. cheaper but over the years the quality of these products has also risen drastically. This has resulted in intense competition for small manufacturing companies.
Shortage of skilled labor
There has been a tremendous decline in the number of people enrolling for skilled courses in universities over the past couple of years. Furthermore, a major portion of the existing workforce in the U.S. manufacturing industry is almost on the verge of retirement. Consequently, there is a shortage of skilled workforce across large and small manufacturing companies.
Competition from on-shoring
Small manufacturers are also facing increased competition due to the growing trend of on-shoring. Foreign companies that primarily cater to U.S. customers are finding it more cost effective to manufacture in the states because of the cost of storage, transportation, and tariffs. This acts as an added competition for small manufacturing companies in the already difficult market.
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About Infiniti Research
Established in 2003, Infiniti Research is a leading market intelligence company providing smart solutions to address your business challenges. Infiniti Research studies markets in more than 100 countries to help analyze competitive activity, see beyond market disruptions, and develop intelligent business strategies. To know more, visit: https://www.infinitiresearch.com/about-us