Let's just say, we are thrilled about our partnership with UnderFit Shirts. Not only are we impressed with their quick success, but also with their dedication and support for Made in USA. Not long ago, UnderFit went through the not-so-easy process of reshoring their manufacturing. We sat down with founding partner Ben Brockland to learn a little more about what prompted them to initiate this effort.
We all know that small businesses face a serious decision when deciding where to manufacture their product. When Ben Brockland and David Palmer launched UnderFit Shirts three years ago, they initially chose to manufacture their shirts in the Dominican Republic. But as the company grew, Ben and David quickly began to reconsider this decision. Growing up in Detroit, David saw firsthand how beneficial manufacturing jobs are to everyday Americans. Combine this with the issues they were experiencing through the overseas manufacturing process, and a compelling argument began to surface. After further consideration, Ben and David decided to do their part and bring back manufacturing, a choice neither would regret -- not for a single minute.
After the first batch of USA-Made shirts was finished, Ben and David sat down and drank a few beers. Not only in celebration, but also to discuss just how much easier, less stressful, and safer it was to manufacture in the USA. In addition to the obvious reasons (create jobs, support our economy, etc), the following three reasons topped the list when asked, "why the change, why Made in USA?" More specifically, what manufacturing issues were you facing that prompted this decision?"
Here are the issues mentioned:
1. Customs. The Dominican Republic has a free trade agreement with the USA and it seemed like a lay-up to get US raw materials into the DR. Naturally, most officials you talk to will claim that the process is simple and cheap. Of course, that is before they have your goods in hand. Once they are in control of these goods, all sorts of fees begin to surface; regulations and taxes that cannot be avoided. Once in control of something you want/need, they utilize their leverage and force you to succumb to their demands.
Story: UnderFit sent 2,000 yards of fabric to the Dominican Republic for the manufacturing process. Upon arrival, customs officials informed them that they were now charging a 16% sales tax as well as another 8% fee (which could be waived with a substantial “gift”). BOOM – a 24% increase to their costs.
2. Corruption. Bribery is a way of doing business in the third world, not just a dirty word. When you manufacture abroad, corruption often takes the form of “gifts.” Unfortunately, these gifts are mandatory if you want people to do their job.
Story: UnderFit waited three days for a government official to “find” the paperwork for a shipment of fabric that was already sitting on-shore. Unfortunately without the “lost” paperwork, the official wasn’t able to release the fabric. In the end, David gave the guy a “gift” and as a result, the paperwork miraculously appeared. Within a couple of minutes, their fabric was released.
3. Government. Many third world governments have little transparency regarding their laws, regulations, and fees. If you try and learn more about them, you may find yourself spending hours in a government office waiting on officials who rarely ever show up to work. On top of that, there is seemingly no consistency to how the laws, regulations, and fees are enforced. If an official decides to break the law and take advantage of you, it’s possible there will be no real way to fight back. You may be forced to either give in to what they want, or suffer the consequences.
Story: David went to the Dominican customs office to learn more about the laws and regulations that apply to importing fabric from the US. On the first day, he arrived at 8 AM and was told the man he needed to speak to would be in at 9 or 10 AM at the latest. He took a seat and waited until noon at which point he was told that the man would not be coming in at all. He asked if he could make an appointment but was told "no." His only option was to come back the next morning and hope for a meeting. He did just that, but again found himself sitting around for four hours—only to again be told again, that the man would not be coming in. The next morning, the man finally showed up at the office for the first time all week. He told David he was busy and that he would have to wait for availability. The official then proceeded to read the newspaper. After a while, he had David come into his office, told him that he couldn't guarantee any specific amount of fees, percentage, or anything of the sort. The only advice he could give involved David going to actual port and figuring it out himself.
After these experiences, it’s easy to see why David and Ben are thrilled to be manufacturing in the USA. Ben said it best, "we love manufacturing in the USA and now have the process easily streamlined. It takes only a few phone calls to put all the wheels in motion. UnderFit Shirts arrive a few weeks later and there are no unexpected expenses along the way. If you are huge company such as Nike or Walmart and have massive resources available, and the corresponding personnel in place, these issues can be overcome. But, as a small growing business, the same kind of business that helped make America what it is today, manufacturing in the USA is the only way to go."
At William Rogue & Co, we challenge you: when considering the best manufacturing solution available, look beyond cost savings. What looks good in the form of a price quote, doesn't always translate to overall cost savings and efficiencies -- take it from UnderFit Shirts. And for the greater benefit of us all, join the movement -- support Made in USA.
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