February 19, 2011

Which East?

We can say without a doubt that production in the world has been shifting from the West to the East. When you analyze the details of many of the products of the West, you find out producers from the East. At this point the question to be answered is, which East we are talking about.

Many manufacturers, that have not asked this question, are not happy about where they have relocated themselves in the East. Some of them are even coming back from there. Allison Bruce,  a reporter for the Ventura County Star, writes, “Companies that once went abroad to manufacture or source materials are now starting to look closer to home as they encounter the challenge of trying to do things more cheaply abroad.”

It is not sufficient to calculate costs on paper. Facts stay where they are. The manufacturers of the West now wish to be closer to their markets and move their manufacturing in productive production sites. Consequently, East Europe is one of the optimal solutions for many manufacturers. If your company is  located in East Europe, for example in Romania, Bulgaria, Turkey, then you might have a new partner in the future as such manufacturers seek solutions concerning their place of production.

Just the other day a business owner  from the West was surprised to find out from a local competitor that he can produce cheaper in Turkey than in China due to differences in productivity.

When you will be discussing such a partnership, the business conditions of your country will also play a role on the final decision.

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