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Component Manufacturing dverti$er
Don’t Forget! You Saw it in the
Adverti$er
August 2019 #11241 Page #86
Offshoring and Outsourcing— Lessons from a Personal Journey By Andrew Carr, Platinum Global (retired)
H
ow did this Australian component manufacturer become involved in offshoring? It started with a trip to Vietnam in 2004, and it ended much differently than I would have expected!
I had been operating my company in Australia, Truss-Rite, for 16 years, selling prefabricated wall framing and roof trusses. For a point of difference, we also offered a supply and install service. Being a licensed builder, I founded Platinum Homes, specializing in custom designed and built larger homes. It was one of my housing clients who took me on that fateful tour of Vietnam. Immediately, I saw an opportunity for a light weight and fast construction solution for this large emerging economy. Their existing methods were slow and labor intensive, to name just a few of the challenges they faced which we could address. So, with great enthusiasm over the next year, I secured land, built a factory, applied for and received my business licenses, etc. Although I also had to import the treated lumber I used, I became the only component manufacturing plant in Vietnam using it, and I even developed a low-cost affordable kit home. Fast forward 3 years and I was out of cash and the business had failed (those 3 years hold a much longer story than I have space here to document). I had burned through over 2 million dollars with nothing to show for it. But, instead of taking every bit of sensible advice and leaving Vietnam, leaving me a failure and possibly going bankrupt, I was determined to prove that I was a fighter who needed to find a new opportunity.
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My former factory of 30 workers now employed only an office staff of 5, but we still knew the construction business. Using the resources we had, we started doing design work for component manufacturers in Australia. Over the next 18 months, we operated by charging on a per-job basis, sharing the work between our in-house designers. The external hurdle we faced was the negative perception of offshoring— it was not a popular thing for our clients to do. The internal hurdle, however, was equally difficult—it was hard to achieve consistent quality. Yes, our designers were all university graduates, well trained, and very motivated, but the quality would bounce around. Continued next page
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