For many of years, QTS have been producing wire mesh decks across a wide range of racking types in a range of different countries. And, we know what we do makes us one of the best, if not the best in our field of manufacturing expertise, wire mesh decks! However, we also know as good as we are some of our customers are working with the tight margins and even tighter lead times. So, we adopt the ‘Your Pain Is Our Pain’ method and do our upmost to create the best possible solution within these restraints. In some cases, our clients don’t have the pressure of lead-times which allows them to shop around. After some initially search works they usually start getting tempted by the Chinese manufacturing option.
Chinese manufacturing is unquestionable, something of a juggernaut in today’s myriad of global industries. But, has this beast become so big that it can no longer sustain its bulk? As Bob Dylan once sang, “The times they are a changing” QTS looks at 6 different key areas that are changing the landscape of Chinese manufacturing asks the end of the cheap Chinese mesh deck?
1. Shipping ( Expenses VS, Time VS, Risk)
- Expenses: The cost of shipping from a remote city in China where now most factories are placed, versus the cost of road transport from somewhere in the UK, will be drastically different. So, you will have to do the maths on the landed cost, for example, the final cost of your goods once they have arrived at your companies front door plus, the duty cost you’ll pay to the UK government to determine the final price you will pay. Then you will need to compare this to the final cost after you have paid the shipping fees of your domestic factory supplier like us here at QTS. You’ll then have an apples-to-apples analysis on how much money you’re saving manufacturing in China is any, especially if you work with small quantities … but I’ll come to that one later on.
- Time: Then there’s the time difference. Shipping by sea can take at least 30 days. Naturally, shipping domestically can literally take one day. So, depending on what your project lead time is, this may make or break a big deal with potential clients. Think about the loss of sales that you will have every time you don’t have the ability to met those ‘last minute’ projects that think nothing goes wrong between China shipping by sea and the cargo arriving at the port, such as the Janjin Shipping collapse which brings me onto…
- Risk: It’s not every day you expect the world’s 7th largest shipping line to go into bankruptcy. But, back in August 2016 that is what exactly happened to South Korean Shipping Company Hanjin. In a recent QTS article, we looked at what happened to the lead up to the collapse of Hanjin. However, since the chain of events has left many UK companies waiting for their imports whilst the ships holding the cargo are languishing just outside ports across the globe. To make things even worse, the height of the retail season is just around the corner and it looks like the same UK companies will have to pay the ports out of their own pockets if they wish to see their own imports. Now, of course, no one is suggesting this is fair but, minimising the risk is the key to the most successful business decision and there is an awful lot that can go wrong over 17,115 nautical.
2. Higher Minimum Orders
Chinese Manufacturing is known to work with far lower profit margins than their western equivalents – just ask Apple why their iPhone is manufactured over there. China can mass produce the iPhone far cheaper than any American electronics manufacturer hands down and are being able to ship massive quantities across the globe. For those of us that don’t run a corporation like Apple, what if your requirements are fir smaller quantities or one-offs? The chances are they won’t be able to accommodate your orders, or you will have to pay far higher rates than any local manufacturer and where is the sense in that? Chinese manufacturing is geared up for Mass production the trade-off producing them large numbers is the inability to stop production and reset machines to run small orders of bespoke products.
Moreover given their location from the UK it creates huge obstacles for example, what if you wish to see how the first run production has performed? And, if the fresh input is required due to there being a design floor? Working with a local manufacturer allows for a more responsive consultative approach and removes any language barriers.
Here’s a question to ask yourself, when was the last time you were in a shop or anywhere for that matter and you heard someone ask, “Excuse me, can you point me to the Made in China?”. I think it’s fair to say ‘Made in China’ has some negative connotations and for good reasons. The Rapid Exchange of Information Systems (RAPEX), the EU’s consumer protection alert system that operates across E.U countries, published its 2014 report, “Keeping European Consumers Safe,” which provides a graph ( on page 17) illustrating ‘number of notifications by country of Origin. The UK only has had 38 product notifications against the top 3 offenders which were Turkey 3rd with 66, Germany in 2nd with 75, and then China is by far the worse offender with a massive 1,462 product notifications. It’s no secret that Chinese steel is inferior against European steel. This is mainly down to the high carbon content that emerges in the smelting process that makes their steel brittle.
A recent example of the Chinese Steel failing spectacularly happened this year in New Zealand when the transport agency refused to use Chinese steel pipes in a major bridge building project. Tony Dickens, project director of the joint venture, said “Quality issues were identified shortly after the steel arrived in February and strength tests were conducted. The batch of below-strength steel forced a design rethink for two bridges along the selection”. One can only wonder how much time and money that has been lost on that project all because of the Chinese steel seemed a cheaper solution. Buy twice Is an adage that works very well here.