Many companies are starting to move their manufacturing from places like China back to the United States. Although the return is not as fast as some might like, it is happening. There are multiple reasons for the change.

Bringing Manufacturing Back to the United States

Why Are Companies Coming Back to the United States?

Tariffs, along with increased wages in China, have made manufacturing overseas less profitable than it once was. Companies often worry about the supply chain risk when manufacturing overseas, as well. Already, companies have faced disruption in the shipment of goods from other countries, and this has become more common in recent years.

Another reason often cited by companies that are returning to the United States is the fact that the supply chains are often far removed from the market. When they are so far away, it can cause problems with not only the satisfaction of the end customer for the product but also customer service. Companies tend to be less agile when they have their shipping out of the country, too. Some of the businesses that are starting to make this change include Caterpillar, GE, and Under Armour.

Intellectual property theft has also become a major problem with manufacturing overseas. Many products produced by US companies have been the victim of this theft, and the market has been flooded with imitation products from China. These imitations are making their way to the US market, often undercutting the original products. China has also used spyware through products from Huawei and other companies, which highlight potential cyberthreats that can come from manufacturing overseas.
Given all of these reasons, it becomes much easier to see why companies are starting to move their manufacturing back to the United States.

What Does This Mean for Warehousing?

With an increase in manufacturing in the United States on the horizon, this means that these companies will have to develop their own warehouses or utilize warehousing facilities that are already in place. Regardless, they need to be sure they are running these facilities properly. Namely, this means having a quality warehouse management system up and running. This is especially true for companies that have become accustomed to having the warehousing and shipping done out of the country.

A warehouse management system will offer a range of benefits, and it helps to ensure that the warehouse runs optimally. This is better for the customers and the company.

When using a WMS, it can help to better optimize the space that’s being used for warehousing and has the potential to lower operating expenses. It can eliminate the waste of floor space and provide better organization. This means it will be easier for employees to find the products when it comes time to ship them.

Companies will also have much better inventory visibility when using a WMS. They will have accurate, real-time information on their inventory levels. They can know their supply and avoid backorders and orders for items that are no longer available. This will lead to more satisfied customers.

By having each product in a specific place and having that place mapped out, it becomes easier for employees who are picking items. They will not have to waste time and effort trying to find what’s needed to fulfill an order. This speeds up the process and makes the warehouse staff far more efficient. Materials are easier to trace, shipment management is easier to handle, and ultimately it means better customer service.

Companies Need a Proper Warehouse Management System

Regardless of the type of company, if there’s a warehouse, there needs to be a warehouse management system in place. The old methods of managing a warehouse, which many companies returning to the US may have used in the past, are no longer feasible. Times have changed, and there is a need to utilize the best technology for managing warehouses. The days of paper warehouse management are at an end.

Of course, with all of the options available, it can often be difficult for companies to know which WMS they should choose. The system should be flexible and customizable enough for companies to “make it their own,” so it works with the type of business they are operating. There should be a robust amount of features that will help with the management of the warehouse, along with shipping.

Whether the company is returning to the US or just getting off the ground, taking the time to find and implement a WMS will make a big difference in its success.

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WiSys has re-invented how ERP systems create value for customers. To meet the business challenges of a new economy, companies need to focus on reducing reaction time to maintain customer loyalties and improve supply chain operations; from receiving through production to delivery. WiSys Agility products have been designed to achieve efficient Warehouse Management (WMS), Supply Chain Management (SCM) and Business Intelligence (BI), all from one software publisher. Contact us to learn more.