Domestic Sourcing: Why It’s Worth the Cost

Reliability, speed-to-market and quality are offered by domestic sources.

By Scott Rusch, Anomatic Corporation, Newark, OH

In many industries, including the beauty and personal care segment, competition from Asia is a growing concern. Many North American and Europe-based companies are finding this competition poses several unique challenges. The inability to match Asian manufacturers direct employment costs, where pay is well below market wages (compared to Western nations) and the lack of stringent environmental regulations in Asia, often makes the cost comparison a losing battle. To compete in today’s tough environment, cosmetic manufacturers must find a very real niche with deliverable benefits.

Retail Reality Demands Excellence

The current economic climate, combined with increased competition from international forces and shrinking profit margins, have all contributed to the national business trend toward Asian-partnered manufacturing. At the same time, as consumer tastes and preferences become more sophisticated, brand marketers are relying on increased flexibility and “stopping power” (the ability of a product’s shelf appeal to “stop” a shopper) within the retail environment to make revenue projections.

With competition for retail space and consumer attention at all-time highs, creativity (intelligent packaging) that holds and does more, is in high demand.

The best and most effective new packaging design and production will incorporate great looks, high-end materials and reliable performance with features that differentiate it from the rest.

American-made packaging suppliers can deliver what’s needed. The quality of American-made products is among the highest in the world. For while our labor costs are higher than many other nations, the quality and service provided are worth the cost. The benefits described above, set North American cosmetic packaging apart from Asian sources.

Responsible corporate citizenship is also essential. For, while today’s consumers demand value and variety, they also want a climate that conforms to rigid environmental standards. To accommodate these needs, packaging design requires tighter partnerships and flexibility at the front end of package design as well as during manufacturing. It’s the kind of partnership that requires a North American connection and commitment. It’s an issue not fully addressed by our Asian competitors.

Balance Cost with Quality

The cosmetic and beauty industry, as a group, should not simply look for manufacturing that delivers needed products at the lowest cost.

Service, quality, and environmental responsibility are issues that have to be considered. As smarter producers, we must continue to partner with clients to develop ongoing answers for not just today’s consumers, but also for future generations.