15 Apr Reshoring Manufacturing Makes Cents
The reshoring initiative is still something not many people are aware of . To understand these terms better, we had our talk today.
In this week’s Manufacturing Ecommerce Success Series, our guest speaker was none other than Harry Moser. Harry is a renowned name in US and global manufacturing. Harry is the founder of the reshoring initiative. He has even worked with the President of the US to help get manufacturing jobs back into the US.
The conversation started with Curt Anderson introducing the guest to the show. After this, Harry shared a bit about his past and from did he start his career. He told how he worked at General Electronics and then paved his way up to Acme Cleveland.
After this, Curt asked Harry how he started the reshoring initiative. Answering this question Harry shared a story. He said that his father was working in the factory of singer sewing machines when he was a child.
He said that at this time this company was doing in-house manufacturing for everything. But when he visited the same factory after 20 years, everything was imported from somewhere. This is when Harry realized that he should take an initiative on his own to promote manufacturing in US.
Talking about reshoring manufacturing, Harry said that he was lucky enough to get sufficient investments. He further elaborated that his mission for reshoring manufacturing is to balance the trade deficit around US manufacturing.
Moreover, Harry also said that their target is to have a decent industrial policy for the US. After this, he shared some stats regarding the US reshoring manufacturing. Harry said that they have to work more on the manufacturing side of the industries too, instead of imports. Because according to Harry, this is what the competitive nations are doing including China.
Moving on, Harry talked about the calculator tool that he has on his website for manufacturers to calculate. He said that it’s simple to use. All you have to do is get on the website and answer a series of questions which are around 29.
He said that once you answer those questions it calculates the duty freight carrying cost of inventory, travel cost, and things like that. Adding more to the reshoring manufacturing conversation, Harry said that they have a feature on their website, where they show how many jobs are available in which major industry.
By the end of the conversation, Harry shared some more stats to elaborate on his concept. The conversation ended with Curt and Damon thanking the guest for his presence.
Harry Moser is the Founder of the Reshoring Initiative. Before this, Harry has worked as a President/Chairman at Agie Charmilles LLC. Moreover, Harry has also worked as the President of Charmilles Technologies Corporation.
He was also the President of the Manufacturing Department of the same company. Apart from this, Harry was the President of Roto-Finish, a company that produces vibratory finishing machinery.
Before this, he also worked at Acme-Cleveland and Disamatic. Moreover, Harry also holds the experience of working with the Massachusetts Institute of Technology and General Electric.
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Reshoring Manufacturing Makes Cents
harry, manufacturing, reshoring, company, manufacturers, industry, product, people, kurt, country, factory, ecommerce, china, years, offshore, tcl, dan, imports, price, cost
Damon Pistulka, Curt Anderson, Harry Moser
Damon Pistulka 00:01
Let’s see. We got Harry. He’s going to turn on his camera and then we’ll be ready to go.
Curt Anderson 00:06
Happy Friday, Damon. Hey,
Damon Pistulka 00:09
how’s it going? All right, Harry. So I’m gonna get us live on LinkedIn here, and then we’ll get started. Sam, let the video play in the background on LinkedIn while we’re doing this. Hello, everyone. Welcome once again to the manufacturing ecommerce Success Series. I’m one of your hosts, Damon Pistulka. And your other co host, Kurt Anderson, we’ve got another special guest here today to talk about an important subject for manufacturers that are interested in e commerce. So Kurt Anderson, take it away my friend, I’ll be monitoring the chat on LinkedIn. And if you’re on LinkedIn, go ahead and let us know where you’re
from what’s going on.
Damon Pistulka 00:54
And we’ll be we’ll be monitoring that Kurt is going to be hitting the chat here on on Remo. If you want to join us on remote but you’re on LinkedIn now. Don’t fret, just go to my profile. And you can click the remote link in there and get over to see us. Kurt Anderson. Friend. I don’t even know what else you want to say. But it’s
Curt Anderson 01:14
all good. Take it over man, Damon brother from another mother. So man I am I’ve been looking forward to this for months. I am so excited. so fired up. This is our we have a celebrity in a virtual house. Yep. Two guys, I’m on remote here, drop your links, got their LinkedIn connection in there. Happy to have everybody on here. I’ve dropped Harry mosers LinkedIn profile. So guys a quick introduction on Harry Moser.
So Harry, welcome to our program. I’m going to give a quick little introduction here. I don’t think Harry even needs an intro. So Harry Moser is the founder of the restoring initiative. He is a rock star celebrity advocate and Ambassador for us manufacturing. So Harry, welcome. Thank you for joining us today. Happy Friday
Harry Moser 02:04
my screen. It’s great to be here. You guys have done such a good job promoting this. You’ve been all over the internet. And you’re like any exact example of how to do e commerce. So it’s wonderful.
Curt Anderson 02:18
Thank you. Thank you. So I want that. So for folks that aren’t maybe I don’t know who on earth isn’t familiar with Harry. Let me give you a quick little background game. And I don’t know if you know some of these facts here. So Harry is an MIT grad. And so Mariana, I, I applied to MIT and I didn’t get in because I spelled it incorrectly. So he has an MBA from University of Chicago. He is an amazing, incredible manufacturing career that we’re going to dig into. But let me share some of the awards that he has won over the years as the ambassador for us manufacturing. So he is the one he’s in the industry week Hall of Fame, which is a huge honor.
He was quality magazine quality professional year, I believe in 2012. He was added up on President Obama’s insure ensuring forum. He’s he was on the he won the manufacturing leadership councils industry advocacy award. He’s been in Wall Street, Forbes, The New Yorker, USA Today, Fox Business. So Harry is all over the place. Harry again, I don’t know how you do it. But we’re so honored to have you today. Thank you.
Harry Moser 03:27
Thank you, Kurt. Part of the key is, I work almost as hard as those Goldman Sachs people we’ve been hearing about on the news that the supposedly the new ones the first 1020 years they work an average of 98 hours a week.
Curt Anderson 03:43
Oh, wow. Well imagine night. That’s a lot. Well, let’s, let’s dig in. You’ve had an amazing incredible manufacturing career. So before we dig into our program, we’re gonna we’re here to talk about reshoring. How and how critically important it is for our country. Our economy manufacturing, let’s let’s go back in time. So you graduated from MIT engineering, you great MBA from University Chicago, how did you find your and I believe you started your first job. It looked like General Electric is that we started?
Harry Moser 04:12
Yeah, I started in the manufacturing management program at GE at the large steam turbine generator in Schenectady. And then shift shifted out to San Jose, not bad for nuclear power, came back and worked at MIT, and was called industrial Liaison Office keeping companies up on MIT’s technology and then a variety of companies, but it’s almost always in manufacturing foundry equipment.
Great, no longer existing us machine tool company called Acme Cleveland that own national Acme, like Acme Gridley screw machines, and a variety of companies and eventually I was the president of roto finished and then the president of shermie EDM machines Five axis milling machines, which is now George Fisher are gf machining solutions. So it’s a great career. I had a wonderful time love the industry,
Curt Anderson 05:11
right but worked relentlessly for years dedicated yourself to manufacturing 1000s and 1000s of jobs that you’ve had a fingerprint on as far as helping create an establish. And and then of course you you know most people go into retirement, maybe they’re not. I know you’re an avid tennis player, you go off and play tennis, you play golf, what do you decide to do? We’re going to roll up my sleeves and start this incredible, wonderful nonprofit called the reshoring. initiative. How, how did that come about? What was what was the aha, where you’re like, Okay, I’m retiring. And guess what I’m plunging. Right? And how did that work out?
Harry Moser 05:46
Well, I think it’ll be easier for me than playing golf.
Harry Moser 05:52
so the background on that I grew up in, in New Jersey, Elizabeth, New Jersey, right across the river from New York City. And the biggest thing in town was singer sewing machine. So that the main factory for the world, the place where the whole thing got started, was there. And that factory 100 120 years ago, was the largest factory of any kind in the world. It was 2.5 million square feet, 5000 workers in a day when most places were small. And my grandfather was a farmer. And my dad ran about a third of the factory. I worked there summers in high school in college. And I went past 20 years ago, and nothing of singers made there anymore. Everything’s important.
Everything comes from somewhere kind of thing. And I, I cried when I thought what had been lost by the city, the family, the, you know, the state country, and enjoy my career selling machine tool selling foundry equipment. I came across company after company, industry after industry that I wanted to sell something to, and they weren’t there, or they were shrinking so fast.
And why were they shrinking because of the imports that are our industries decline? The other guys came in, and therefore I since I only sold in North America, there was nobody who sells stuff. So So eventually, when all that was done, I said, I’m retired, I could sit on the beach, but much more fun to bring 5 million manufacturing jobs back.
Curt Anderson 07:23
Wow. Yeah. Right there virtual applause. We’ve got we’re not done yet,
Harry Moser 07:29
though. So got a few more of those to get well.
Curt Anderson 07:33
We have a lot of great friends in the crowd. I read Bowman and Dan bigger, you know, we have mutual friendship with Dan bigger, and more. So what an advocate he is for, for us manufacturing. So what a great emotional story, you know, it hit close to home, close to your heart. Talk about how so you start a nonprofit how you know, and again, you’re in retirement, you’re like, I’m rolling up my sleeves. How did how did that process go?
Harry Moser 07:59
Well, I was I was blessed when I was leaving George Fisher, that they are instead of instead of like, they fire me on Friday, we agreed to a three year transition like this, I became chairman chairman emeritus, whatever. And so I was able to still have the connection still be able to travel and and make, you know, take advantage of all my contacts, the the media, the companies, etc. And, and get the thing started. The one complication I had I, I started to get some companies or associations that wanted to be sponsors. And they sent me they sent me checks. And, ah, I’ve got to incorporate so I can get a bank account so I can cash the check.
From an app, right,
Harry Moser 08:47
yeah, that would make sense. Anyway, so we were blessed to have very active support from AMT, the cook that puts on imts 130,000 person machine tool show in Chicago, AMT ntma National tooling and machining Association, PMA, the Swiss machine tool society, which I happen to be president and American foundry society and groups like that, that that came on board George George Fisher, my old company, they came on board helped us help this they sometimes just gave us money other times they asked us to do articles and presentations and all kinds of stuff so just just I’ve been blessed to have the support of all these people in the industry that made it possible
Curt Anderson 09:32
and just confirmation of the mission and just everything you’re behind. And again, we’ve got some great friends on here like gal john. Course mentioned Jan, bigger Val, you’re winning my hire Valerie says manufacturing ecommerce success workshops are the best part of my Friday’s value right here, right? No doubt No, no. Big Hairy why we’re here why we’re doing it. Can we show off our T shirts right now brother.
Okay, here we go.
Curt Anderson 09:57
Here we go. Manufacturing is full. So we plan just a little bit. We played our haircuts with our team.
Harry Moser 10:08
So one of the keys curd on the manufacturing is cool t shirt. Anybody who submits on our website or emails me on new reshoring case that we didn’t already know about, they get a free manufacturer’s cool t shirt made in the US out of us cotton,
Curt Anderson 10:27
that errand. It’s our friend Aaron and Madison just asked Nice work, where can we get those? So there we go, don’t get me,
Harry Moser 10:34
here, here it is, find me a case has already happened. And you get a T shirt. Let me help you make something significant happen in terms of reshoring. And you get two t shirts
Curt Anderson 10:47
that, hey, why don’t want as many t shirts as possible. Cool. So this is an Dan says maybe we need to get the USA made manufacturing t shirt business. Amen. I agree. So Eric, I know we want to dig right into, you know, we want to dig right into the reshoring initiative, I think you’ve got a little presentation that you want to dig into, you want to pull that up.
Harry Moser 11:08
I think I can tell you a couple things first, before then please. The that’s our mission is to balance the trade deficit, you eliminate the trade deficit, which would be an increase of 5 million US manufacturing jobs. That’s a 40% increase. So imagine all of those of you who are in manufacturing, imagine if your business was 40%. Bigger, that’s where we’d be if we’re when we balanced trade deficit, the and then the reason we have this trade deficit, which has grown from nothing, we have, we have surplus back until 1980. And it’s grown to it now averages about 800 to 900 billion with a B per year. So are our imports exceed our exports by 800 to 900 billion.
And the reason for that is the US just is not price competitive. Now we’ve got good people, they work hard, etc. But a combination of the dollars 20 30% too high. We don’t have the skilled workforce training that the say the Germans and the Swiss have, right? We don’t have a value added tax to protect our borders. We’re stuff coming in. For years, our corporate income tax was the highest in the world. And so companies when they made the decision to Where should I put the factory? Where should I put in the new equipment? Where should I train the people, too often, it wasn’t us it was somewhere else.
And so our data shows that, that the US is about 15 to 20% higher in fob price Ex Works price than say Germany. And we’re 40% higher than China probably 50% higher than India if the product can be made in India. And so, and companies look at that. And they say, I gotta go. Because my competitor is going to go if I don’t go there, I’m out of business. So they go. So it’s a for the US. Almost all the other countries have an industrial policy, they say, like you see China, they’re going to be good at chips, they’re going to be good at military at a solar at, you know, 5g, you name it name and name, all the important things are working on.
And the US has just fat, sad, fat and sloppy. And just whatever happens, it happens, you know, laissez faire, blah, blah, and I’m a conservative, I believe in laissez faire. But But when the when the, when you’ve allowed the field to be tilted against you, it just it doesn’t work doesn’t work for us. So so we we advocate very strongly for the US to have industrial policy. And we don’t think you should pick companies as winners. We think sometimes it makes sense to pick industry. So I think right now chips, solar electric batteries for cars.
So you make sense. But most most important, we should pick not industries, but industry, we should say the US cannot survive, unless as strong manufacturing, and will change the level the playing field, by currency by tax rates by skilled workforce by value added tax or whatever it takes, until we’ve eliminated the trade deficit because imagine 40% more people working in manufacturing, and then the kind of the rewarding, wonderful career that manufacturing gives, you know, with training opportunities, apprentice programs, credentials, chance to go on, get a bachelor’s, master’s degree, whatever.
And, you know, we see that as the as the best solution to most of the country’s biggest problems. And you know, unemployment, the all this like the opioid crisis, the inner city problems of pollution, budget deficits, you bring back those 5 million people and a lot of those problems get a lot smaller. So so I’m you know, so we’re always advocating Government to get its act together and make that happen.
Curt Anderson 15:02
That’s a fantastic point. And it’s been hasn’t happened overnight. It’s been a very slow kind of death by 1000 cuts, or, you know, if you will watching manufacturing in that decline since 1980. Now, the numbers that I know you just put out an article recently, was it 12 12 million jobs is that we’re looking at and manufacturing currently,
Harry Moser 15:22
currently about 12 and a half.
Curt Anderson 15:25
Yeah, yes. And so with that, 40%. So let’s talk a little bit about trends, favorable trends that you’re starting to see. We’re starting to turn the ship around.
Harry Moser 15:37
Yeah. So now you’ve got a
Damon Pistulka 15:40
let me Yeah, well, let you let you get this shared again,
Harry Moser 15:43
figured out how to do okay, share
and hit share.
Harry Moser 15:48
application window application share, there should be coming up,
boom, awesome. There we go. How’s that good.
Harry Moser 15:56
It’s your train me three or four times. And I can remember as
Harry Moser 16:03
shows the Guru’s. So we track a combination of reshoring by US companies, think General Motors, for example, foreign direct investment, FDI by foreign companies, Toyota, Siemens, something like that. And the total of the two of them in 2010, was about 6000 jobs. And that got up to 190,000. Total, in 2017, is driven by the tat corporate tax and regulatory reductions, everything was looking really good. And then we came up with a trade war. And companies got into a condition of business uncertainty, they didn’t know what the tariffs what tariff rate was going to apply to what product from what country for how many years, as they said, well, let’s just not invest.
Let’s wait and see, let’s let’s see how this whole thing plays out. chuffer, 2018 2019, went down still good, you know, still much better than back here, but not as good as here. And then in 20, foreign direct investment continued down as companies probably same, probably the same thing in other countries, companies focused on their home market. So you can see this came up here.
And actually, I’ve got a later version of this and shows it coming up to about 100,000 reshoring. Jobs announced last year, so a record for reshoring. itself. And, and that was driven significantly by COVID. So in the cases of reshoring, from March of 2020, to the end of the year, about 66% of the cases mentioned, COVID is one of the causes, and maybe maybe half of them were directly related. So there’s dozens and dozens of companies that have started making masks and gowns and gloves and all that all that material that that is that we ran out of that we didn’t almost didn’t make. We were so dependent on China and others.
And then the other half were companies that said, Hmm, I see what’s happened in the medical industry. But we make something else widgets, electronics, you know, something, and that could happen to us. We can’t get our product from from China from somewhere when this goes bad. So why don’t we pull back and make more of it here and be self sufficient and more reliable. So So between those those two factors, COVID has has been, obviously a disaster, a horrible thing. But it has accelerated the reshoring trend.
Curt Anderson 18:35
That that what you don’t realize what a huge vulnerability You have until like vulnerabilities in your face. And it just really hit us hard this this past year, you know, realizing that supply chain, and there’s been a lot of us on the call today. And Harry our mutual friend Laurie was constantly here.
He was just on Lori’s podcast, we could go fantastic interview, strongly encourage you to check that out. Guys drop your LinkedIn profile in the chat box. You know, for manufacturers, you know, you work with a lot of manufacturers, you work with a lot of MEPs around the country. So and for anybody not familiar with the MEP sector manufacturing extension, partnerships? Here we can you talk a little bit about what what what, what’s your role? What do you do with the MEP s? I know you do a lot with imacon. Illinois, correct.
Harry Moser 19:23
kubek they’ve been the most aggressive they’ve had the biggest program. So what Kurt’s talking about, we offer the total cost of ownership estimator, which companies used to reevaluate their offshoring and see if it makes sense to bring it back by understanding all the costs and risks that most procurement people ignore. And then we offer the import substitution program so the companies can come to us, either directly or through an MVP, or an economic developer and the company can say We’re really good at making widgets, or whatever it is shafts, bearings, housing, something, we’re really good at making these.
And then we tell them who the biggest importers are of widgets. The biggest importers are what that company makes really well. And then we identify the company, the importer, where the located address, what they’re bringing, in what tonnage roughly what they’re paying for whom they’re buying it from, or Sure. And then we train the US company like in Illinois company, through iMac, we train the the US company, to use total cost to go to that company and convince it that when it shifts and buys from the US company, instead, it will actually be 510 15%. lower costs, lower total cost, even though the fob price might be higher.
Curt Anderson 20:57
Okay, perfect. And that’s fantastic. Laurie, thanks. Lori dropped her, her podcasts and her LinkedIn profile guys, I just in Harry’s LinkedIn profile, and the restoring initiative. So the TPO, you actually have a calculator tool that manufacturers can go on your website and use that calculator.
Harry Moser 21:19
And I’m going to take you down one slide. Okay, so you, anybody who wants to, it’s free online,
Harry Moser 21:32
you go to it, and sign up, sign in. And you do a calculation, you answer a series of questions, maybe 29. And the foreign source, and, and it calculates the duty freight carrying cost of inventory, travel cost, all kinds of stuff like that. And, and it makes a huge difference when you do that. So I’ve, I took the first 180 cases where users compared China to the US. So you can see the blue line here is a distribution of those cases, the horizontal axis is the Chinese price as a percentage of the US price.
So at 100, they’re equal because, you know, two over two is one, which is 100%. So and the average or the mode of the price ratio is around 70%. So the Chinese price across a whole range of industries, is about on average, 70% of the US price, but not too bad. And 8% of the cases, the Chinese price was higher than our suit, because the ratio was above 100%. But 8% isn’t very much. But when you take the same cases, and you look at the TCL, with a total cost of ownership, the 8% goes up to 32%.
And if there happens to be a 15% Trump tariff in place, then it goes up to 46%. And so so just by doing the math correctly, by recognizing all the costs, all the risks that are relevant, the the percentage of the work that makes sense to come back to the US and be done here, more profitably goes from 8% to 32, or even to 46%. So So we, we, if I if I meet somebody here, what’s the opportunity I say, maybe 20 or 30% of what you’re importing, you’d be more profitable if report back either either in your own factory, or outsource to a machine shop, a foundry, you know, somebody on the outside.
Curt Anderson 23:35
That is so Wow, this is just so powerful, what great information and it’s really, there’s a little bit, you know, black and white, as far as numbers and cents go. But there’s also an emotional, you know, again, we realize the vulnerability this past year, and when you start breaking down these numbers, we’re starting to see like, hey, there’s incredible opportunities, bringing products back here. Are there certain industries, you know, like, you know, say like wood chips, circuit boards, you know, all the little parts that you know, capacitors, diodes, all those things, you know, we’ve lost all that. Are there certain industries that you feel that could be should be coming back sooner than later.
Harry Moser 24:18
If you go to our website, or when you go to our website, and look under, there’s a blue bar at the top resources, recent data 2019 data report, you’ll have 2020 there pretty soon. And you open that up and you will see that excuse me, that we we actually show the number of jobs coming back in each major industry.
And automotive has been number one. Excuse me, again, to automotive has been number one, and I think number two is electronics and then maybe appliances and maybe chemicals and then machinery something like that chemicals driven significantly by fracking Because the shale gas gave us a cost advantage in, in chemicals far off setting the the little bit of labor that you have in a at a refinery. So So that tells you what is coming back, we would say, in general, that things should come back would have the following characteristics, the the say the freight cost is high relative to the labor content.
So, perhaps the, the demand is volatile, it’s either very seasonal, like Christmas shopping kind of thing, or it’s just unpredictable. And therefore, there’s a significant advantage to having a local source instead of an offshore source that takes maybe two or three months to replenish supply. So we’ve identified a series of characteristics like that of the product, that intellectual property, if you’re worried about having your intellectual property stolen, China’s probably not your first choice, you know, us would be a good choice.
Curt Anderson 26:01
We could have a whole session just on intellectual property. Yeah. But the threat of losing, you know, gain bigger just time to chimed in, you know, intellectual property is a huge one. And, you know, that’s a constant constant threat. And Dan also said, you know, he could use a class on how to use your tool more effectively. And I think it’s just such powerful results. Powerful answer for folks that are just so adamant. Well, I have to go abroad, I have to go abroad. What? Go ahead.
Damon Pistulka 26:31
I’ve got one, I’ve got one thing to add here that I think that is, especially when we’re talking about manufacturing and e commerce in the in, in the demand is that when you have a local source or a source as closer to you, that’s not the two three month lead time, you can react so much faster to customer demand, and not have these large chunks of inventory that you’ve committed to that’s that’s in transit in production ready to go. And I mean, in Dan’s industry in injection molding is a great example. You look at a pure cost basis for for small plastic parts, those things can, you know, you can there’s cheaper places in the world to do it.
But when you caught and when you put the cost of transport, the cost of the order sizes you got to do you cannot react to customer demand. And if your customer demand is changing, this, this onshoring of your production gives you a better advantage. And that’s that’s really some of the things that I’ve seen that even in projects that the the some of the latest products project I worked on with some very, very, very, very large companies, where it was a combination of offshore source and onshore source just because of that very fact. So that it we just covered a little bit of it. But it really makes a big difference in the US consumers desire to get what they want when they want it. Right.
Harry Moser 27:57
Let me comment on two things that came up in the last couple of minutes. First, I think Dan said he’d like to learn more about TCL if you go to our website, again, the blue bar at the top, I think his videos drop down the menu, and there’s maybe a snooze you drop down the menu menu do two videos. And there’s one or two webinars one our free webinars just just solely on TCL how to use it takes you on their website, takes you around gives you ideas on how to get started. Now not enough for enough to be dangerous. And and if you need help, then email me and your call me. Another thing I think Kurt mentioned printed circuit boards.
So my favorite case of reshoring is a company called Mori cork, there are large printed circuit board, popular later and they make the complete finished board and other products from that. And outside of Chicago. And they came to me about five years ago, they were about to lose a big order, a Chinese competitor recommend with a lower price. And so I worked with Tony the VP sales. I helped him do the TCL calculation. He showed the customer that even though morish price was higher, the total cost for the customer was lower. ever have a quote from Tony, saying that was key to winning a 60? That six $0 million dollar order?
Round of applause? Yep.
Damon Pistulka 29:33
Yeah, good stuff.
Curt Anderson 29:34
Well, that so and I just want to chime in real quick. There’s four manufacturers out there that are maybe facing that or you’ve you’ve been hit negatively with imports. And that’s, unfortunately, a vast majority of us manufacturers, if not all in some capacity. There is an agency that is a federal agency called tac, t a c and I believe it’s trade agreement.
Harry Moser 30:01
Trade job aid adjustment agreement center, trade adjustment assistance
Curt Anderson 30:08
So they’re spread out throughout the country, I think there are regions, like you’re in New York that covers New York, New Jersey, Midwest, I
Harry Moser 30:17
think, I think there’s five of them.
Curt Anderson 30:18
Though, if you are a manufacturer or you’re you’re a marketer, working with manufacturers, check out the tech program in your, in your area. And what it is, it’s federal funds, that helps manufacturers it’s a it’s a grant, I don’t I don’t want to get too deep. I want to take away from Harry’s time, but just checked it out. So here, let’s dig into that,
Harry Moser 30:39
let me correct just Just let me clarify on that the tacks are helpful. But there they are reactive. In others, they only come in place when a company has lost orders because of imports. Okay, whereas we I’ve tried to get them to become proactive, so that when a company is thinking of laying off people and building a factory in China, instead, the attack would help them understand total cost. So they wouldn’t do that, or would help them take advantage of our import substitution program. So it’s a good program to be a better program that was proactive, instead of just reacting.
Curt Anderson 31:18
And you’re making a great point, it’s almost like putting a bandaid on the cut the injury after the injury happened. So a fantastic point, let’s talk a little bit about what company what can companies be doing on their end, to help us make make ourselves more competitive?
Harry Moser 31:36
I differentiate between the OEMs and the supply chain companies, the people who sell to the OEMs. And some some companies are obviously both. But first thing you use total cost. Now, to stop deciding on the basis of just price. But look at all the costs, all the risks that are that are involved. And if you do that, again, 20 30% of what you offshore, you’ll decide to bring back,
you we set
Harry Moser 32:03
priorities. Now, for example, we recommend priorities first priority, if anything that is not now offshored, don’t go offshore without doing TCL. Because it because once you get it off there, it’s relatively harder to bring it back. A second would be bring back work that you’ve outsourced offshore and others you’re having a contract of a foundry, China daughter Turkey, and bring it back to one here doesn’t cost you very much, because it’s not your building over there. Third would be you’ve got a you’ve got a your own facility in that other country.
And it may be it’s making 50% of its output for the US 50% for the local market, like Asia, repurpose it over five years, and haven’t make 90% for Asia, and put your incremental investments in the US take up for that supply. And the toughest thing is to shut the found factory over there and build one here. I know most people aren’t going to do that. So that’s that’s the least likely the lowest ROI priorities. So there’s thing things like that you can do if you’re trying to pick work in a company and decide what to reassure, look at the products that cause pain.
So walk around, talk to the people talk to quality and say, Where are you having quality issues with offshored product? To talk to inventory control? Where are you stocking out? Or sales? Where you’re stocking out? Or inventory? Or where do you have too much, you know, work your way through the various departments in the country company and look for allies who will help you eliminate the pain that they have. A lot of this is to avoid ilos because the the procurement people tend to be maximizing their bonuses by cutting price rather than maximizing profitability by reducing total costs. And
Curt Anderson 34:04
you have a nice customer here from Pierre saying I’ve utilized the TCL spreadsheets to evaluate several components for reshoring. A couple of years ago, excellent tool to drive data driven decision versus opinion, what a great response. And that’s the thing is like, we you know, trying to change that mindset of like, you know, cheaper is better, you know, being so focused on quote what the bottom line is Damon’s bringing up supply chain, what we’ve encountered this past year, you know, how many intellectual property Dan broad language barriers, so many benefits? So, Harry, here’s a big question for you.
Who is President Harry Houser of the United States? What changes would you be making on a broader scale and what are things that the country overall that we could be going on our little show as we’re trying to be ambassadors, Dan would vote for you I would definitely vote. So what are what are steps that you recommend that as a country We could be doing a buyer seller seat more competitive.
Harry Moser 35:03
I’d be a first those things that I talked about in the beginning, I would get the dollar down by 20 or 30%. I wouldn’t do it one day. because it’d be too disruptive. But over five years, maybe, but but Treasurer Yellen has said, No, we want a strong dollar. Well, she’s wrong. And why was wrong on that? The I would shift a third of what we spend now on student loans, and turn them into apprentice loans.
Right now, maybe 3% 5% of our high school kids go into apprenticeships in Germany and Switzerland, it’s 60%. So I get many, I just probably a third of the kids that go away to college now instead would be going into apprenticeships. And they’d be given the data that shows them that proves that that in most cases is going to be a more profitable career for them than having a lot of student debt. And working in Starbucks, which happens too often to too many of them.
Harry Moser 36:07
I have a value added tax like all the other country countries do, which makes imports more expensive. Undoubtedly, more spent, I keep the corporate tax rate at 21% not have a go up back up to 28% is some some more spending on innovation. Pick certain industries. I don’t like picking industries.
But I think you have to do it now because it’s gone too far. With chips, and solar and electric batteries and rare earth minerals and things like that, that we we can’t let ourselves be dropped from the race. And so we have to subsidize those areas. But if we put if we do the things I said first if we level the playing field, then the amount of subsidy you have to give to the chip factory or to the electric vehicle batteries comes down dramatically because their cost difference relative to offshore has come down dramatically.
Curt Anderson 37:02
Yep. That’s the question. So are you have a big fan out here. Gail, a dear friend Gail, she’s talking about your podcast with Lori. So guys, if you get a chance, check out Lori’s podcast. I think she’s put that link in the chat box. It’s a wonderful interview that Harry just did recently. So Harry’s man time just flies, man it does it does send after to Eastern time. So every our program is you know, we caught manufacturing ecommerce success. So what reshoring in e commerce where do you see centered synergies? Or were there opportunities for manufacturing?
Harry Moser 37:39
And in a very strange way, at first, it was almost negative. Because recently, or maybe still true. Chinese companies can ship products like through the mail to us customers, cheaper than you in the US, US Customs. So to have some kind of a strange agreement our Postal Service had, so that we were actually you might say subsidizing Chinese e commerce into the United States. I think that i think that’s being handled.
But But in general, no, as a general rule, the good when you like, I think was pointed out before with e commerce you need, everybody expects quick delivery, and you need immediate replenishment of the distribution center. And you can’t cannot get that by surface freight from China or from anywhere outside of North America. And therefore that gives an advantage to the local supplier.
So I’d say that e commerce helps reshoring and in many ways reshoring helps e commerce because e commerce one of the key advantages I think of ecommerce is customization is producing a product you know the the one off this unit like a pair of running shoes for Harry with Harry on it or something like that. And and that’s tough to do from way offshore. But it’s relatively easy to do from a local local factory. So So to me, ecommerce supports reshoring reshoring supports ecommerce is a great future for right now.
Curt Anderson 39:17
Music pioneers. I couldn’t agree with you more Harry. And so anybody comes to these shows or you know, anybody that’s willing to listen to me preach that that word customization is just so critical. And as I’ve been kind of pounding the pavement or beating the drum for the past 10 years or so trying to help manufacturers, that’s my preaches always then when you get when you can get manufacturer direct to that end user, not necessarily consumer.
And now with Amazon, now you can get closer to that consumer with Amazon but when you said configurator our dear friend Kevin’s on the program today with Gen alpha great company in Wisconsin. You know, cutting edge software they do configurators and daymond. I are preaching anybody Everybody that’s want to do a configurators Jeffrey Stern’s on the call today, we just helped him configurator just just last week, and when somebody can land on your website, and now can customize that product, what a great competitive advantage for us manufacturer. So, to
Harry Moser 40:16
Kurt, I just pulled up one slide, there’s a very good friend of mine, Greg Owens, and he and Matt put out the Oneida flatware with a stainless steel flatware factory up in New York State. And he tried to compete against China etc, couldn’t as quickly just couldn’t get the cost low enough to sell through retail.
And instead he’s he’s he’s selling almost exclusively direct. And because he’s cut out that 50% or whatever that the middleman and the retailer take, he can sell a better product made in USA at a prices competitive with a Chinese product in the retail store. So now this doesn’t work for everybody not gonna sell steel this way, probably. But but but but for many things. Sell selling direct selling ecommerce can make you efficient enough to make us manufacture. Right?
Curt Anderson 41:07
Yep. Yeah, I couldn’t get that. That’s our preach every week, then. Going. Ecommerce just opens up so many opportunities for the manufacturers. You know, and again, I know and we talk a lot, I attract manufacturers. We’re like, man, we don’t have a proprietary product or that finished good, what do we do, but they have preparatory processes. And there’s great opportunities there. So Harry, what I want to do, I want to be mindful and respectful. I want everybody to get a chance. Everybody’s trying to talk to you as a table.
One on One little hairy time. So Harry, as we kind of as we wrap up, first off, thank you, my friend, thank you for what you’re doing for our country. Thank you for what you’re doing with pounding the pavement for restoring you have a lot of fans you have a lot of people supporting, supporting you. And I feel there’s a lot of momentum. We had a young man, Mike Womack, who I think’s a mutual friend, with the New Jersey MEP.
He was on our program two weeks ago, 27 years old, and he’s so fired up for manufacturing, there’s, I feel that there’s a lot of momentum coming in. What do we always like to close out our program with this question? So our dear friend Allison of Ford says, she always preaches how do we help our clients? How do we help our customers be the hero of their story? How are you? And you’ve kind of answered this for the past half hour, 45 minutes? How are you out there helping your customers, your clients, your manufacturers, being the hero of the story?
Harry Moser 42:40
The best way we we give them an opportunity to tell their stories? If they reported us, like you didn’t get your shirt.
Harry Moser 42:55
And we’ll we’ll promote it on our website. We can if a company has a couple of good stories, we’ll we’ll do an article for industry week and get them you know, national fame so they can sell more. No, no, we love to make them the focus of
Curt Anderson 43:13
bottom line what it does for the community. So our friend, Ray, Laurie, Kevin, john Jean, everybody, Jake, thank you guys. Jeffrey, your friend, Gail. Thank you guys for being here on remote. Everybody on LinkedIn. Thank you so much, Aaron. God bless you, dude, you’re just such an expert, to go into retirement and to build this wonderful nonprofit. Such an admirable cause. You have a lot of fans a lot of love. A lot of support going out there for you. So thank you my Yeah.
Harry Moser 43:44
You’re so kind, but it’s a supportive people like you knowledgeable, enthusiastic people like you that did make it worth getting up every day and fighting the fight and looking for another Hunter. Nice
Curt Anderson 43:55
job. Nice. Thanks so much. Hey, real quick, Damon. I just met Brian this morning. So Brian’s on the call today, Aaron, of course, my dear friend of Madison. AJ is where those IRA was on the line. So guys, thank you. Thank I tell you, I just want to close on this. We look around. We have a great time. We can’t thank you guys enough for joining us every week. We are just so enthusiastic. We just really like what Harry just said for the past half hour. We’re just so relentlessly trying to drive us manufacturing. So we really appreciate you taking the time to join us every week. So thank you.
Damon Pistulka 44:31
Yes, yes. And thank you, all of you that were joining us on LinkedIn live. appreciate the comments. We had tons of good interaction there today as well. But yeah, we are we are here to help manufacturers in the US really understand their their opportunities. And Harry just a great example of day. So we’re dropping off a LinkedIn live we’re going back to the tables on remote to talk to Harry. But thanks everyone for joining us.
And bye Everybody back to the floor. We go