THE THOUGHT PROCESS BEHIND PRODUCT ORIGIN (NSC WHEELCASE)
Globally, textile manufacturing is hyper competitive. Driven by cost pressures, changing consumer expectations, and a myriad of other factors, organisations continually look to new markets to manage effective profit margins. A different shaped economy, but still no small market, NZ does too hold its own textile capabilities. So we knew the choice and their trade-offs were ours to ponder.
OPTION: Go local, engage those in your own wider neighbourhood, or OPTION: go offshore and support the workers of a far-flung community.
When putting ourselves through this sort of thinking, below are some of the top considerations that came to mind for us as a small business.
(Tāmaki Makaurau - NSC's spiritual home)
KEEPING IT LOCAL
Going local; the benefits
Done Kiwi – It feels good to know you are supporting local, the people and jobs in your community, also keeping the next profit margin circulating at home in NZD.
Tight feedback loop – It's terrifically easy to stay connected to the process, to make changes and oversee the project from design, through prototyping, to production.
Oversight – You can see the standards of labour and can be confident of the conditions of manufacture.
Locality – Lead times and logistical complexities are at the absolute minimum.
Going local; the concerns
Cost pressure from labour – A highly developed economy like NZ is at odds with a workforce focused on textile manufacturing. Labour becomes your greatest cost per unit, well beyond material costs.
Scale – NZ is small, and volumes for textile manufacturing at home are even more so. There are less players in the market, and less raw product enters the country, so the cost per unit for material is higher.
(yes, China, our friends who manufacture)
If you choose to offshore, it's likely you won’t pick a market that looks anything like your own. Likely you will need to choose a place your customer may never find themselves visiting, where those charged with manufacture live and work in ways you simply cannot relate to.
Going abroad; the benefits
Supporting work of those we don’t know – We know the good of supporting the livelihoods of those in far flung markets.
Maximum cost efficiency – Conversely to at home in NZ, textile manufacturing is a highly competitive market globally, with many crafty business people in many countries willing to provide to our needs. We could create and ship-in an identical product and likely both pass savings onto the customer, and keep a bigger profit margin ourselves.
Going abroad; the issues
No visibility or assurance of the production environment – We can’t easily visit the manufacturer, and we have pretty much no ability to audit processes or build our own perspective of the working conditions we would be enabling.
Logistical complexities – Long lead times, issues with borders movements and larger shipping costs.
Design disconnect – It’s much harder to engage, discuss and demonstrate requirements or make incremental improvements. Face to face interactions are off the cards.
SO WHERE DID WE LAND?
As you may well know, our carbon wheels are manufactured in Xiamen, China. You could say this is the hub of global experts on the topic of carbon fibre – Xiamen is well recognised at the world’s preeminent carbon fibre and cycling manufacturing location. For our business it’s something we couldn’t do here at home – not saying it can’t be done – but for us to make carbon truly as (price) accessible as we would like, we need to rely on the scale and expertise of those in Xiamen.
With our wheel case, we weighed up our considerations. We knew there was capability in NZ for this type of product, even as the Auckland textile industry is one that has seen significant change in the last 30 years.
The mark up on product produced internationally can be absolutely astonishing – just go research the pay of garment workers across our Asian nations. We will openly admit that the mark up / profit margin on our NZ made wheel cases is absolutely tiny – it could be arguable that it’s not even worth us having these in our portfolio while they are NZ made. But we thought, we aren’t in the game of wheel cases - we are here to make carbon more accessible, so we aren’t concerned by this aspect right now. On it all, we’re proud to be bringing an NZ made option.
Our NSC Wheel Cases are manufactured in Glen Eden, Auckland by J Wisemans and Sons, a textiles producer that has been operating in NZ for over 160 years. Materials are sourced from Industrial Textiles in Avondale, Auckland.
All images by the Author.
(NSC Wheel Case)