The current COVID-19 crisis has revealed that now, more than ever, the United States must not rely so heavily on production in other countries. U.S. supply chains should rely more on improving domestic warehousing and manufacturing rather than outsourcing in order to have their own resources and to be a competitor in the global marketplace.
Supply Chains Should Move From China to the US
The most reasonable and effective way forward for the United States would be to move Chinese supply chains to the U.S. Doing so would expand and preserve domestic manufacturing capacity, and in turn would create the need for increased warehousing. By focusing too much on outsourcing, with the main priority being to lower costs, serious commercial and strategic risks can be created. Bringing back more warehouses and manufacturing to the United States could help fight issues brought on by the current coronavirus pandemic, while maintaining competitiveness on a global scale in industries like artificial intelligence, semiconductors, and advanced technologies. Although it may be difficult in the short-term to completely move production of a company from another country to the United States, in the long run it will be beneficial to companies in terms of reducing costs.
The Need for Warehouses in America
The COVID-19 pandemic has revealed an extreme need for medical equipment and PPE in the United States. Most products associated with fighting the crisis, such as masks, respirators, antibiotics, and over-the-counter pain medications, are all manufactured in American-owned factories and warehouses that outsource low-wage labor from China. Even prior to the pandemic, various products including children’s toys, Apple iPhones, clothing, and many other items have been outsourced from China due to decreased cost of production. At the very beginning of the pandemic, shelves in grocery stores across the country were cleared of non-perishable goods and essential household items like toilet paper. The pandemic has brought on unprecedented supply chain shortages. This goes to show that the United States, along with many other countries, is highly dependent on China to provide products to them including essential medical supplies and PPE, despite the fact that the U.S. and China are currently in a trade war. If China were to retaliate against the U.S. further by cutting the supply of exports, the results could be even more detrimental to the United States’ supply chain and its imports.
Looking for Warehousing?
The current trade war between the US and China, with the additional crisis of the COVID-19 pandemic, has led to increased difficulty in manufacturing and producing overseas. Now is the best time for companies to relocate back to the United States, to start using more warehouses domestically, and to keep an open line of communication with manufacturers and suppliers. To learn more about the warehouse industry and creating more warehouses, contact Brown West Logistics today and speak with one of our team members.