Amidst the storm of trade war, many US companies are pressured. However, a survey shows that 87% of the companies do not plan to move out from China. Here are why:
1/ China has been providing well trained workforce, good infrastructure, good safety & quality control. Many companies have been working hard to achieve all those in the past 30 years.
2/ It is hard to copy this in Vietnam or India within a short period of time. For example, Vietnam's population is only 7% of China. It means that Vietnam is not able to digest all the production currently operating in China. For India, even though its population is similar to China, its infrastructure is really not comparable with China. It is estimated that it takes at least 10-15 years for India to develop a good system, good infrastructure, well-trained workforce like China.
3/ It is almost impossible to bring back production to US because there is not enough workers for production. Basically there is no American wants low skill factory jobs and it will be an issue to hire enough workers in US.
4/ When most companies moved their productions to other southeast Asian countries and president Trump now wants to play the “tariff game” there, then what now?
Because of above reasons, most US companies do not plan to move. The foreseeable action is that they will gradually transfer the tariff burden to consumers and it will make the retail price increased up to 15%-30%.
Thank you for reading!
Subsrcibe newsletter
Don’t Miss Out
Runhee was established in January 2010. It is a manufacturer dedicated to making use of 100% recycled paper as a raw material to effectively replace plastic hangers.
Copyright © Dongguan Runhee Paper Products Co., Ltd. All Rights Reserved | Sitemap |