Manufacturing is the foundation of economic security, environmental sustainability and a country’s standard of living. In the United States, it employs two-thirds of scientists and engineers, produces 90% of U.S. patents, and represents more than half of our country’s research and development. And perhaps most importantly today, manufacturing produces both the goods and the jobs that sustain communities.
That is why everyone from economic development agencies in communities throughout the U.S. to the White House has given manufacturing increased focus. As the Council for Competitiveness so succinctly puts it, “The perception of manufacturing as dirty, dangerous, dumb and disappearing is far from accurate. Today, manufacturing is smart, safe, sustainable and surging.” It is driving an innovation economy in the U.S.
A 2013 Boston Consulting Group survey of 213 manufacturers found 38% were considering or already had shifted production to the U.S., up from 18% in 2012. But while many American industries moved outside of the United States are now looking to return, flooring manufacturing has predominately remained in the U.S.
According to estimates from the Carpet & Rug Institute (CRI), 98% of all the carpet installed in the U.S. is manufactured in the U.S. At the same time, approximately 99% of Shaw’s wood products are manufactured in the U.S., and the company is one of a handful of manufacturers that is building a U.S.-based LVT plant—along with it announcing $300 million in investments and approximately 600 new jobs to be created for the U.S. in the past year.
Why? To best meet the demands of the local market. Manufacturing close to the customer enables companies to nimbly offer the widest array of products available immediately in the range of options that customers expect—without waiting six to 12 weeks for shipping to the U.S.
There are numerous advantages to manufacturing locally—including decreased order lead-time and increased innovation.
A vertically integrated manufacturer that produces many of its own ingredient materials, and manufacturing a product in the country in which it will be used can have significant advantages, particularly related to order lead-time.
As an example, Shaw’s distribution network includes the 40th largest privately owned transportation fleet in the U.S.—and a distribution network that delivers both ingredient materials and finished products around the country and around the clock.
Proximity to the Customer is Key
The U.S. also boasts one of the most dynamic freight rail systems in the world. The 140,000-mile system moves more freight than any other freight rail system worldwide. Because rail transportation is three times more efficient than road transport, this impressive system can help improve shipping times—in addition to decreasing fuel consumption and reducing greenhouse gas emissions when transporting products across the country.
The net result is an efficient, vertically integrated manufacturing process that significantly reduces order lead-time.
This is a critical factor in customer satisfaction. In an age when everything is at consumers’ fingertips online and businesses requiring expedited delivery in order to compete, there is little tolerance for delays. Such delays potentially impact new home and commercial construction as well as renovation timelines—and, in turn, budgets—given how central flooring is to design.
In a global economy, the shipping of goods overseas is inevitable and valuable. Like a number of flooring companies, we are proud of the vast amounts of products we manufacture and export outside the U.S. But precious time can be lost when the supply chain extends across an ocean. Local manufacturing reduces order lead-time—and it is more predictable as there is limited control on timing when products or materials must go through customs.
Innovation Through Proximity and Collaboration
Because carpet manufacturing never left the U.S., the category has the sort of manufacturing hub other industries seek to replicate today. We enjoy a trained workforce, robust infrastructure and the benefits of design, engineering, production and service collaborating in close proximity to exploit the opportunity for innovation.
While we have a global workforce that is attuned to design trends that will play well in a global marketplace and in particular geographies, there is inherent value to having design, research and development, manufacturing and sales teams in the same geography. There is a more instinctive sense of market shifts and appetites, and perhaps most importantly, a collaborative spirit that fosters the iterative process that is innovation.
Our experience creating the unique Caress by Shaw collection a couple of years ago illustrates this principle well—showcasing how fiber innovation, product development and design inspiration can come together in a winning combination.
Shaw’s fiber and R&D teams had created a prototype of an incredibly soft nylon fiber product for which we were seeking the right way to bring to market. The prototype became an ever-present part of our meetings—whether it was the focus of discussion or not. Our hands just gravitated toward it because it was so soft, and we kept coming back to the thought, “This is special, but how do we do it justice, aesthetically speaking?”
In parallel, our design team was struck by the richness of hand-woven wool rugs seen in European markets, and they began to wonder how this effect could be produced in nylon in a way that would be durable underfoot and stand up to life. Thanks to the teams working hand-in-hand, the two ideas converged and began to bloom into even more possibilities with different loops styles, color variations and even a 100-ounce product that emerged from ongoing ideation sessions. Within the collection of 20 styles, there was extensive back-and-forth between design and manufacturing to work through the 50 or more colors we were dyeing in an effort to get them all just right. With four patterns, there was extensive back-and-forth between design and manufacturing to work through the various dye differentials. It was an effort that involved myriad company teams and plants over the course of several months.
While this sort of innovation is possible across time zones, the ease of frequent impromptu hallway conversations can more easily transform a “what if” to a “let’s try it.” Proximity fosters an exchange of ideas—effectively weaving together research and development, design, prototyping and production.
All in all, manufacturing locally—in the country in which the flooring product will be installed—has significant benefits to manufacturers as well as dealers, designers and end users who expect high quality, innovatively designed products in a timely manner.
Hal Long is executive vice president of operations at Shaw Industries, a role he has held since 2006. Long is responsible for all manufacturing, quality, supply chain, sustainability, innovation, and research and development functions at Shaw. For more information, you can call (706) 278-3812, or email firstname.lastname@example.org.