Is it just a matter of marketing?

Fritz Maurer

Well-known Member
I was in Drug Mart this evening in the office supplies dept., looking at all the Chinese made stuff, most of what could be made in someone's garage. Over in the snack isle there's a bag of fried soybeans, but the bag didn't state where they were imported from. Ertl toys also come from China. I'm sure there's guys on this very forum that can run a Bridgeport well enough to carve out a mold to cast a 1/16 scale tractor. You don't need any real ingenuity to melt pop cans. What in the world makes this and all other small metal do-dads so cost prohibitive?
 
The investors want to see a ROI(Return On Investment). The greater the dividend, then more investors will want to invest much more money into your company so you can grow.

Labor costs are the issue. In China- labor costs amount to around $1.60 a day (I know Foxcomm raised their rates). So, when you get Americans to work for a Buck-Sixty per day, Then America can compete with other third world countries.

They can build it cheaper Overseas and ship the items to us cheaper than we can pay people to build the same item here.

So, until a large portion of our population decides that it is okay to live in dirt floor huts or dormitories with 10 to a room, this is why you have the problem with "Made in the U.S.A."
 
I live just 15 miles from where Ertl toys started. The real problem is the regulations requiring this and that to manufacture here in the US. The requirement you have to go through to cast anything today is terrible.

Have you ever heard of the Chinese OHSA???? There is not one. So where a US manufacture would have to have hundreds of thousands of dollars in air filters and personal protection equipment the China manufacture has ZERO cost. If some one gets sick or dies there is no law suets in China either.
 
JDSeller- Do you think the regulations put in place by the Federal Government would prevent fires like a garment-factory where a fire killed more than 110 people Saturday on the outskirts of Dhaka, Bangladesh? Just because there were no fire escapes and the managers told the workers to get back to work because there was no fire. This seems to happen quite often in places where there is no "government regulations". Just like China...They have very few laws regulating hazardous waste disposal and that aids in producing a cheaper product. Heck, they even put melamine into baby formula thus killing many infants. What about the China provided drywall to the USA? That created lots of problems for homeowners in the USA.

I guess my bottom line is...There are just as many unscrupulous people in the USA as there are anywhere in the world, when it comes to making more money over someones families health or well-being.
 
(quoted from post at 17:51:19 01/05/13) JDSeller- Do you think the regulations put in place by the Federal Government would prevent fires like a garment-factory where a fire killed more than 110 people Saturday on the outskirts of Dhaka, Bangladesh? Just because there were no fire escapes and the managers told the workers to get back to work because there was no fire. This seems to happen quite often in places where there is no "government regulations". Just like China...They have very few laws regulating hazardous waste disposal and that aids in producing a cheaper product. Heck, they even put melamine into baby formula thus killing many infants. What about the China provided drywall to the USA? That created lots of problems for homeowners in the USA.

I guess my bottom line is...There are just as many unscrupulous people in the USA as there are anywhere in the world, when it comes to making more money over someones families health or well-being.

Greg I think what JD is trying to point out is that with the cost of labor, plus the cost of meeting OSHA and EPA regs it makes things unprofitable to make here unless the consumer is willing to pay a good deal more. That's the whole problem. WE have become addicted to cheap products! And when you can import coffee cups for 10 cents delived to the dock and it cost me 20 cents to get em out the factory door in NJ, well I just can't compete because the consumer is going to buy the cheaper product at a box store.

Rick
 
Oldtanker- How about this... what do you say about stiff Tariffs on imports? I understand everything in the USA will increase. At least, we are not funneling more of our dollars to a foreign country. :)

China has undervalued their currency on purpose.
 
A lot of companies blame regulations, but even China does have some standards. I used to visit a lot of foundries, as part of my job. Iron and steel casting was the nastiest, aluminum foundries were relatively clean. What really gets the foundries are labor and matieral. Aluminmum is a pretty common element, but it takes a lot of electricity to refine it. And countries like China subsidize basic industries, to the point that a US foundry can't buy the matieral for what the chinese company sells the finished product. US managers don't want to be honest about why they outsource production. It's all about the money, and screw the workers. Ertl moved out a long time ago. I've got a couple of their tractors, and some Spec cast also. Lots of detail, lots of hand work, if you can get it done for a buck a hour, you can sell a lot more, at a higher profit margin. The lure of easy money has a very strong appeal....
 
(quoted from post at 01:32:40 01/06/13) Have you ever heard of the Chinese OHSA???? There is not one. So where a US manufacture would have to have hundreds of thousands of dollars in air filters and personal protection equipment the China manufacture has ZERO cost. If some one gets sick or dies there is no law suets in China either.

JDSeller-Did you really mean that???? That is hard to believe coming from you. After your posts of helping others in dire situations and then you post about a US company having to spend "hundreds of thousands of dollars" to protect its employees as a complaint?

Then, to add insult to injury, you say " If some one gets sick or dies there is no law suets in China either".

Dang!! That is ruthless.

Sorry JDS, I just went by your words.
 
I don't think that a lot of folks realise how much US industry has been hollowed out. It would be very difficult, if not impossible to produce anything much more complex than a shovel without using foriegn components. The corporate guys sold us out years ago. A lot of things "manufactured" here are actually just assembled, painted and packaged here. All the parts are made somewhere else. Assembly is generally the least capital intensive, low tech part of manufacturing. I don't think you could buy a car, truck, toaster, airplane, or tractor made entirely here anymore. It doesn't exist.
 
I was talking to a friend of mine at New Years. He works for a large automotive interior company. He spends a lot of time in Mexico. Says the plant in Mexico is a huge industrial park. Literally hundreds of manufacturing plants, employing anywhere from a few hundred to 10K workers each. His plant has over 1K workers, and they hire every day. People quit every day, people get fired every day. Always a bunch of folks waiting. Wages are the same everywhere, the government sets the wages thru government controlled unions. Nearby are huge government housing projects for the workers, very basic, and they have a bus system for the workers to use. They have over 1000 workers, and parking for about 100 cars. The Mexican government subsidises food, transportation, housing. If you try to buck the system down there, you might just disappear...
 
I don't think JDSeller was defending the Chinese system, just pointing out that they don't play by the same rules US companies must and therefore have much lower costs.
 
(quoted from post at 18:56:13 01/05/13) I don't think that a lot of folks realise how much US industry has been hollowed out. It would be very difficult, if not impossible to produce anything much more complex than a shovel without using foriegn components. The corporate guys sold us out years ago. A lot of things "manufactured" here are actually just assembled, painted and packaged here. All the parts are made somewhere else. Assembly is generally the least capital intensive, low tech part of manufacturing. I don't think you could buy a car, truck, toaster, airplane, or tractor made entirely here anymore. It doesn't exist.


It was a lot more than the corporate guys selling us out. A company has to make a certain amount of gross profit to stay in business. A large chunk of that gross profit goes to new material and or product say 3-6 months down the road. If they have to borrow money to buy that stuff they get in trouble quick. The company owners want some money for their pockets too as do investors. The government sold us out by imposing minimum wages. How much do you think that drives up cost every time they raise it? Unions too. Is a guy at CaseIH in Fargo really worth 18 bucks an hour putting in a couple of bolts? The union got em there. So don't just put the blame on that ole evil company. There is plenty of blame to go around.

Rick
 
How much per hour can you live on. You are making
payments and paying taxes on your house or paying
rent. You have insurance on your car and house. You
have a wife with a baby on the way. And there are so
many other expenses the list could go on and on.
Everyone needs a job to support themselves and a
family. You are most likely retired but if you were just starting out today, how much would you work for?
 
(quoted from post at 18:50:55 01/05/13)
(quoted from post at 01:32:40 01/06/13) Have you ever heard of the Chinese OHSA???? There is not one. So where a US manufacture would have to have hundreds of thousands of dollars in air filters and personal protection equipment the China manufacture has ZERO cost. If some one gets sick or dies there is no law suets in China either.

JDSeller-Did you really mean that???? That is hard to believe coming from you. After your posts of helping others in dire situations and then you post about a US company having to spend "hundreds of thousands of dollars" to protect its employees as a complaint?

Then, to add insult to injury, you say " If some one gets sick or dies there is no law suets in China either".

Dang!! That is ruthless.

Greg I don't see in JD's post where he was either condoning or condemning the labor situation in China, he was simply stating how he sees it.

Sorry JDS, I just went by your words.
 
(quoted from post at 18:50:55 01/05/13)
(quoted from post at 01:32:40 01/06/13) Have you ever heard of the Chinese OHSA???? There is not one. So where a US manufacture would have to have hundreds of thousands of dollars in air filters and personal protection equipment the China manufacture has ZERO cost. If some one gets sick or dies there is no law suets in China either.

JDSeller-Did you really mean that???? That is hard to believe coming from you. After your posts of helping others in dire situations and then you post about a US company having to spend "hundreds of thousands of dollars" to protect its employees as a complaint?

Then, to add insult to injury, you say " If some one gets sick or dies there is no law suets in China either".

Dang!! That is ruthless.

Sorry JDS, I just went by your words.


He obviously wasn't complaining in the sense you mean. It's perfectly obvious he was recognizing that outfits like OSHA, local, State and Federal taxes, healthcare, EPA regs, air quality regs, union demands, the devalued dollar, higher interest rates and other factors all contribute to why the US is lousy places to try and build anything.

You need to get off your high horse and read what the guy wrote and not try to put you spin on it.
 
(quoted from post at 04:50:39 01/06/13) How much per hour can you live on. You are making
payments and paying taxes on your house or paying
rent. You have insurance on your car and house. You
have a wife with a baby on the way. And there are so
many other expenses the list could go on and on.
Everyone needs a job to support themselves and a
family. You are most likely retired but if you were just starting out today, how much would you work for?

I think I wasn't clear enough. If a company markets a product and minimum wage goes up that company has to raise the price of the product to cover that raise. So minimum wage increases 10%, product goes up 10%, in general cost of living goes up 10% and very shortly the minimum wage worker didn't gain anything at all from the raise and may have lost it all when costs get to the point where to compete a company moves some or all of it's operation off shore.

When we were starting out we did what we had to do TO MAKE IT. We did not have a TV, fancy car, jet ski, or 4 wheeler. I came home from work and did repairs on the old POS I was driving. The kids came first. We didn't take vacations. When I did have a "vacation" it was home to dads farm where we milked cows and butchered a steer. We didn't have this "have to have it now" mentality. I joined the Army. We didn't buy a TV until I made Sgt. Didn't buy any real toys for us grown ups until I made SSG and that was a fishing boat that the entire family could enjoy. We darn sure didn't pay for baby sitters so we could go out and party at the clubs. Sure some of my peers did and they were always having money troubles. We made sure that there was always food on the table, clothing on our backs, roof over our heads first. Were there things I wanted? Sure. Funny thing is now that I can afford em I don't want em anymore.

You ask how much an hour I can live on. What is your idea of living. Is it the basic roof/food/clothing? Or is it the jetski, 4 wheeler, new car and clubbing? OH I forgot the Iphone thing too. Just gotta have the 600 buck phone.

Gee, I'm sounding just like my dad!

Rick
 
I did not mention anything fancy, except the house
you should be living in does not have a dirt floor.
You could have put out a number unless you could not
live on the $18.00 per hour. Some places in this
country cost more to live in than others.
 
The difference between then and now is that when you had the equivalent of that $18.00 an hour job and needed more money you went out and got a second and 3rd job to make ends meet. Right now if someone offered me an $18.00 and hour job in the evenings I'd snap it up in a heart beat. Both my older kids work for under $12.00 a hour, one under $9.00 and get by with help. If I wasn't helping them they'd either not have car payments or they'd be driving beaters like I did and eating road kill like I did. I'm soft on them and it's my fault.

Anyway, this sense of entitlement to a high dollar job is garbage. You work and earn your way in life, no one hands you anything unless it's family. It's always been that way.
 
(quoted from post at 07:50:39 01/06/13) How much per hour can you live on. You are making
payments and paying taxes on your house or paying
rent. You have insurance on your car and house. You
have a wife with a baby on the way. And there are so
many other expenses the list could go on and on.
Everyone needs a job to support themselves and a
family. You are most likely retired but if you were just starting out today, how much would you work for?

Your post implies that a company "owes" their employee a wage that they can live on. In truth, a company owes an employee what it feels is the value of their labor and what the employee agrees to work for. If you can't make it on your salary, don't blame your employer. Maybe you should have gotten more education or a skill instead of playing video games. Maybe you shouldn't be having babies if you can't afford it. Maybe your wife should get a job. If you don't like it, quit and go find a better job. (I'm using the rhetorical "you").

I've taken pay cuts, shorter hours all the while the owners of the company lived a pretty good life. I didn't complain, I didn't begrudge the owners what they worked for. I just bided my time, kept looking for a different job and even at over 60 was able to find one that improved my salary.
As I've told many people, either do something about your situation or shut up.

As others have said, it's just not the proverbial "greedy CEOs" who have caused US manufacturing to move offshore. It's a combination of higher onshore costs due to govt regulation, countries that want to improve their economies and subsidize their industries, efficiency in transfer of goods (container ships) and technology (computerization), people who want to make $18/hr for unskilled labor and don't understand they're competing with foreign labor that have ALL contributed to the trend.

And to answer your question, I would work for whatever I could get. When I was on a short work week, I took a part-time job for 1/3 of what I was making in my regular job and was happy to do it.
 

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