Onshore vs. Offshore Electronics Manufacturing

Onshore vs. Offshore Electronics Manufacturing

Discover the differences between onshore and offshore electronics manufacturing, and what it means for your hardware startup, courtesy of this manufacturing expert panel. 

Top Takeaways

1. New Trends in Chinese Manufacturing 

Contract manufacturers in China are not immune to consolidation. This can cause confusion for your startup. The Chinese government is also encouraging companies to move inland. The Southern and Eastern portions of the country are very well developed. Further inland, though, it's not as developed, hence the new encouragement to move business to these areas. What this means for you, as a startup founder, is that it's not so easy to fly over to China and check on your manufacturing. Now, your manufacturer could be literally in the middle of nowhere, providing you with a new level of difficulty. However, other countries in Asia are coming into their own as far as being manufacturing options; these include Taiwan, Vietnam and Malaysia. Another trend, is that startups and established companies alike are beginning to take control over their most valuable components, to reduce manufacturing risks. 

2. What are Key Factors for Deciding Between Onshore and Offshore

Deciding to manufacture in the United States starts in design. If you want to make things onshore, you want to design all the minor details to be automated. Avoid handwork that can be super-expensive within the United States (such as minor sewing, gluing, etc., that can be very cheap in Asia). If your design is very detail-oriented, it may be more efficient for you to work with an offshore manufacturer. Depending on whether you're a startup or an established company, however, you'll have different needs that are fulfilled differently based on whether you're working with an onshore or offshore provider. This is especially true when it comes to delivery, transit and other issues that need to be timely, and that can be costly. 

3. When Manufacturing Offshore, What are Contributors for Total Cost of Ownership?

We all believe we will get the best price for a component in Asia, but that's not always the case. For many tech parts, suppliers will offer better pricing in the U.S. This complicates manufacturing strategy, especially if you're manufacturing boards off-shore. You also need to consider that it's not all about the lowest cost of labor. Sometimes you have to take into consideration the various associated risks. Don't just jump at the cheapest thing, and look at the long-term results and costs.

Check out photos from our event here!

About The Speakers

Jim Van Patten

Jim Van Patten

VP of Operations

Van Patten has more than 30 years of experience developing and implementing Production, Improvement and Quality systems in manufacturing, financial services, and healthcare.

Dior Wu

Dior Wu

EVP & Co-Founder, Meritronics

Co-founder of Meritronics, which is a Silicon Valley-based electronics manufacturing services company, Wu has experience in business development, time-to-market and new product introductions, bringing products to market at a low cost. Specialties include printed circuit board assembly services and turnkey PCB assembly.

Cindy Eldridge

Director of Supply Chain Services

Cindy Eldridge is the Western Area Director of Supply Chain Services at Avnet Electronics Marketing.

Shirish Joshi

Shirish Joshi

VP of Manufacturing Operations

Joshi is a highly accomplished visionary professional with extensive experience in leading initiatives that drive breakthrough business improvements across retail, peripherals, networking, computing and telecommunications industries.

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