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Canadian Manufacturer Outsources And Insources

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Many North American manufacturers are usually of one mind. They are either adamantly opposed to offshoring any manufacturing work to low-cost countries, or they are of the "free-trade" mindset that says it is an absolute right to pursue the best solution to manufacture their products - wherever that may be.

But Ji Wei is unique. He realizes that certain jobs and customers require different solutions. So, Jim does both.

From the article "New Ontario Injection Molding Shop Tackles Chines Competition" (www.canplastics.com):

As if it’s not enough work to keep one business going during a severe recession, Jim Wei decided to open up a second.

Superi, Inc.The owner and operator of Waterloo, Ont.-based Superi Inc., a company that helps North American firms establish automotive tooling and molding operations in China, Wei recently started a one-man injection molding shop called Victory Manufacturing.

Based out of the same Waterloo facility as Superi, Victory Manufacturing has 50,000 square feet of floor space and two injection molding machines – an Engel and a Nissei – at present. Wei’s objective is simple: to use his knowledge of Chinese manufacturers to beat them at their own game and bring some custom molding contracts back to Canada.

Victory ManufacturingYou’ve probably spotted the irony already: Superi Inc. helps companies shift production offshore, Victory Manufacturing tries to bring business back to Canada.

How can this be? Is Jim Wei a traitor, or a patriot? Is he helping to destroy the Canadian manufacturing economy, or is he trying to save it?

Wei certainly gets (the irony), but he’s more excited by the advantages that small-scale outfits such as Victory Manufacturing could offer over competing Chinese molders. "We have no custom duties to pay, no sea freight or overland shipping costs and guaranteed delivery dates," he said. "Perhaps most importantly, customers of Canadian shops don’t have to order parts in the millions – we can produce small orders economically, which is not true of Chinese outfits."

Another factor working to his benefit – as well as that of Canada’s many other smaller molders – is the recent rise in oil prices that make it harder for North American companies to justify the cost of sending small-scale machining and tooling operations overseas. "Obviously, cost is key to keeping molding contracts from going out of the country," Wei said. "If we can keep our prices competitive, then – all else being equal – I think that North American manufacturers are going to want to do business here."

So, Jim got to know the Chinese manufacturing landscape, saw where their strengths and vulnerabilities are, and took advantage.

The final pieces of the puzzle, Wei believes, involve being creative and flexible as an injection molder. Victory Manufacturing is currently involved in a project to replace metal with plastic in a popular consumer goods item. A mechanical engineering graduate, Wei has the background to serve as Victory Manufacturing’s head of research – as well as chief executive, web designer, mold set-up man and material purchaser – and also a lean, efficient operation that can adapt quickly to new technical challenges. "Having a small shop is comparable to having a small boat," he explained. "I can change direction quickly if I have to, and that flexibility is an important element in taking business away from China."

Jim didn't withdraw into a protectionist cocoon. He branched out, and took advantage of the business landscape in a way that accepted conventional trends and served diverse customer bases.

And lest you think this is about trade policies, currency manipulation or being sold down the river - it's not. This point is exclusive of whether disadvantages exist, outside of our immediate control.

This is about balance, smarts, sound business and ingenuity - something North American manufacturing has delivered over the years, in spades.

There's more than one way to skin a cat. Jim Wei gets that.

Can you make this part?

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