Future Directions: Outlook for Offshore Production of U.S. Print Consumption
As demonstrated above, the U.S. Print market is primarily a domestic industry with relatively small components of imports and exports.
What about the future? Will print remain primarily a domestic based industry? Let's look at some underlying factors that influence domestic versus offshore production. One factor is the weight to value ratio. Products with relatively high weight compared to the values are somewhat less conducive for shipping over long distance. Printing is typically a manufactured product with relatively high weight to value ratio, so this factor supports domestic production.
Another factor supporting domestic production is the production cycle and time to customer. The nature of most print is such that it has a relativelyshort least for much of print. Excluded in this category would be printed products with a longer shelf life such as books, calendars, and greeting cards. These 2 key product characteristic are conducive to domestic production, especially in light of the exremely large volume of print related demand in the US.S. Economy.
However, some countries like China have much lower labor cost, which translates to lower prices. Relatively lower production costs between different countries can mitigate some of the above two factors. The U.S. Printing industry is extremely efficient production for manufacturing is the percentage of cost that is composed of direct labor costs. The general rule of thumb is that those industries and products with less than 10% of total cost comprised of direct labor are well suited for domestic production.
Edity by Vikas
5 April, 2012
