Wednesday, February 04, 2009

And the next China is?

Well, the general consensus last year was that the "new China" (i.e. the place where you can manufacture crap for US consumers at the lowest cost) would be China....meaning inland parts of China which are still substantially cheaper than the Yangtze and Pearl River Delta areas.

Hmmm. Well Black & Decker, while perhaps not manufacturers of crap, are reknowned as being amongst the most aggressive cost cutters and I noted, then, with interest this snippet from their Q4 conference call on Seeking Alpha:

We’ve seen cost increase recently in China and therefore we continue to look at India and Vietnam and other places. As you recall when we put those plants in these low costs areas we put them in such a way where we wouldn’t have the dramatic costs of shifting our manufacturing from one facility to another or even to lower costs countries.
I'm not yet convinced that those who think the next China is China are wrong. However, those planning the location of the next series of B2B trade fairs, web sites and other media services may want to take note and start hedging their bets a bit more. Some, I know, already have been.

Watch this space.


Anonymous said...

Good article.

We are always looking for the best products at low cost to market on he internet.

Unknown said...
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