Reshoring: Making sense for many

JORDAN

JORDAN

By Dennis Seid

Daily Journal

TUPELO – Bringing jobs back to the United States, also known as reshoring, makes economic sense for many companies.

And the advantages emerge not only from an expense perspective.

“According to a recent study, 78 percent of U.S. consumers in 2012 viewed ‘made in America’ products favorably, compared to 59 percent in 2010,” said Joe Jordan with InnovateMEP Mississippi.

Jordan also pointed to another study that showed 76 percent of U.S. consumers are more likely to buy a U.S.-made product, while 57 percent are less likely to buy a product made in China.

The free two-day reshoring conference at the Itawamba Community College Belden campus wraps up today.

Several business leaders gathered at the workshop on Wednesday to talk about reshoring and its many advantages.

“We want to find local sourcing and reverse the trend of producing things overseas and bringing things back to Mississippi,” said Clay Walden, director of Mississippi State University’s Center for Advanced Vehicular Systems Extension, one of the sponsors of the event. “We’re seeing more companies rethink their offshoring decisions, for many reasons. For example, the hidden costs of quality problems – those are some of the issues that end up making more sense to produce things in the U.S.”

A three-year grant to Mississippi Make It In America (MMIIA) hopes to create or save 750 jobs and make an economic impact of $40 million in the Magnolia State.

“We don’t have a cap on it though,” Walden said, “If we can do more, we want more.”

The idea of bringing jobs back to Mississippi isn’t new, but the movement has found some inertia in the furniture industry in recent years. Northeast Mississippi in particular has a strong furniture manufacturing presence, with nearly 40,000 direct and indirect jobs tied to the industry.

Jim Sneed, CEO of Affordable Furniture in Houlka, said his company has tried to keep as many jobs as possible in the state.

“I think we (the furniture industry) is realizing a lot of the jobs – cut-and-sew operations for one – have gone to China and we’d like to get them back for more than one reason,” he said. “It’s a lot more convenient for us, we have more control. Also, we’ve been too quick to jump on the first price that’s given. It’s absolutely not.”

Cut-and-sew workers are whose who, as the name implies, cut and sew the different patterns from the various fabrics used on upholstered furniture.

Sneed said using overseas labor adds cost to inventory, warehousing and delivery, among several factors.

“All of us were caught up in the value we thought we were getting, and in some instances there was value,” he said. “But I don’t think we’ve really gotten a true cost of going overseas.”

The MMIIA program has 84 teams that can go across the state to work with companies and determine if reshoring will help their business.

“It’s not for everyone, but we want to explore those opportunities that are available,” Walden said.

dennis.seid@journalinc.com