The Reasons Behind America’s Manufacturing Resurgence

induction-heat-treatment-bigThe topic of America’s manufacturing resurgence is one many have been focusing on, including us.  We’ve covered different aspects of it in recent blog posts.  But beyond just focusing on the return itself, it’s just as important and interesting to look at the how and the why? To go beyond the numbers and look for the reasons that will keep it going.

How and why is manufacturing returning to our shores?

  • The Cost of Overseas Labor Has Increased:  It used to be that outsourcing was cheaper; Chinese labor simply cost less.  But now, as U.S. labor costs have only risen 3% in the past few years, Chinese and Mexican labor costs have risen 20% and 5%, respectively. Furthermore, dealing with overseas labor is an increasingly political practice, as human rights issues are all too commonplace.
  • Natural Gas Costs: In recent years, there has been a boom in America’s natural gas; our gas reserves have increased by 50% in the past five years.  For manufacturers, this means replacing high foreign transportation costs with low domestic costs, and creates significant savings.
  • Innovation and technology:  Automation and the use of robots is no longer the wave of the future; it’s here and now, and it’s highly beneficial.  The advancement of automation technology has surged recently, creating increased productivity, better products, and lower overall costs.
  • Risky Global Supply Chains: These days, it’s simply too risky for many businesses to rely on a global supply chain. In addition to the aforementioned foreign labor risks, there are threats to security, threats of natural disasters, currency threats, long lead time threats, and intellectual property theft threats in a global supply chain. It’s simply safer to keep as much of it domestic as possible.
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You’ve most likely heard about the Manufacturing skills shortage. But, have you heard how to get around it?

In our last blog post, we discussed the return of American manufacturing, and how and why companies such as ours were able to “weather the storm” and come out ahead.  It’s true—manufacturing is finally ‘back’ in this country.  So why is it that the latest reports seem to be focused on manufacturing job hiring’s—or the lack thereof?

According to recent numbers, U.S. employers posted the largest number of job openings in five years this past February, yet actual hiring was not as high.  The reason, many people say, is because there is a skilled labor shortage.  It seems many of those who were looking for work during the economic downturn chose to retire, rather than return to the workforce.  Employers are not hiring as many people these days because there aren’t enough skills potential employees—the type of workers they need to keep manufacturing moving ahead.   Machinists, in particular, are especially hard to come by.

American manufacturers are, however, resilient.  Instead of rolling with the punches, many are choosing to come up with creative ways of adding to their workforce.  These are the ways some business owners are getting around the shortage:

  • Partnerships: Many businesses are choosing to team up with local schools and organizations, recruiting students and those new to the workforce, and training them specifically for their needs.
  • In-house Training: Those who are having difficulty finding new hires that are skilled for their vacant positions are choosing to train and hire from within, giving proven employees the opportunity to grow, while creating new openings at lower levels in their company.
  • Guerilla-Recruiting: Rather than posting one job ad, or just using word of mouth, many employers are using more aggressive methods.  They’re sending recruiters to campuses, trade shows, career fairs, and alumni offices, using numbers to their advantage.
  • Veteran Hiring: Companies are partnering up with programs such as Get Skills to Work to hire highly-trained veterans in need of civilian work, creating a win-win situation.
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By Weathering the Storm, We Came Out of it Stronger

If you’ve been following the latest manufacturing news, it will come as no surprise to you that American manufacturing is making a comeback.  In fact, do a Google search for “US” and “manufacturing”, and you’ll come up with many optimistic results.  The reasons are many, and they are good news.  In a CNBC interview with T.Boone Pickens, the founder of BP, discussing why and how the U.S. should rely on its own resources, he stated that our country’s supplies are “20 percent cheaper on oil; 75 percent cheaper on natural gas; and 50 percent cheaper on gasoline,” making manufacturing here an advantage.  In fact, the U.S. is the largest manufacturing economy in the world, and manufacturing is driving our economy.   The Manufacturers Alliance for Productivity and Innovation predicts that the manufacturing recovery will only continue upwards in the coming years.

At Ashley Ward, we’ve experienced that on a firsthand basis.  Current and potential clients who used to go overseas are now “nearshoring”, or bringing parts back to the U.S.  We also have experienced the trend of companies moving work to manufacturers that are larger in size and more stable.  During the downturn that started in 2008, many companies who were less financially stable—and less prepared—are now either struggling or out of business.  However, companies such as ours are left stronger as a result of the recent past, and are now better prepared and are ready and able to handle the new business coming back this way.

There are a number of reasons we have always been strong, and are now stronger.  Our diverse customer base and capabilities for many industries—rather than a focus on only one—means we can handle multiple types of operations.  While one type of operation for a particular industry might have been down, others were steady or up, keeping us busy and fully functional.  Whether it’s for appliances, lawn and garden, hydraulics, or any other industry, we can handle it. And while many of our competitors might have only one type of equipment, we have a diverse background that includes expertise on several different types of equipment.  So whether it’s multi-spindle machining, single-spindle machining, grinding, or gear hobbing our equipment is some of the most state-of-the-art and technology-driven in the industry.  Finally, our internet presence allows our customers to contact us and receive quotes online, making the process quick and user-friendly.

We’ve survived the worst of it, came out on top, and are now looking ahead to an exciting—and busy!—future.

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The key to good customer service: Listen. Pay attention. Follow through.

Building relationships between customers and in-house customer service representatives is a continuous effort that includes training and taking advantage of existing opportunities, and generating new ones.

Delivering quality customer service at any company is extremely important – regardless of the industry you’re working in.  In order to encourage repeat business and build a brand of excellent customer service, everyone from the receptionist to the CEO, must be good at networking and building relationships.

Ashley Ward knows the power of good customer service. Here are some tips on training your employees on good customer service practices:

  • Take messages
    • It’s important that your receptionists understand the importance of taking accurate and detailed messages that make the customers feel valued and appreciated.
  • Make sure your customers know that their concerns are being addressed
    • Even if you don’t know the answer, or lack the authority to fix the problem, find the employee who can resolve it. Provide the customer with that person’s contact information.
  • Clarify customer expectations
    • Find out if they prefer to communicate via email or phone, do they want updates along the way or simply to be notified when the problem is resolved, etc.
  • Add a personal touch to each customer you come in contact with
    • Keep notes on key customers regarding hobbies, children, or other personal matters that you can refer to during phone conversations. Something as simple as sending them an online birthday message can enhance any relationship.
  • Follow through on your commitments
    • The act of delivering on your promises plays a big role in problem-solving and strengthening relationships.
  • Tell the truth
    • Admit your mistakes, and then explain how you plan on correcting them.
  • Meet customers face-to-face
    • When customers visit your office or plant, spend a few minutes talking with them. Most people like to meet the individuals they deal with, especially if it’s on a frequent basis.

By observing these customer service do’s and don’ts, you will be on your way to creating repeat business, attracting new customers, and branding your company as one that cares. For more information on Ashley Ward, or to speak with one of our representatives, please visit www.ashleyward.com.

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We ARE the Centerless Grinding Experts!

Unlike some of our competitors, Ashley Ward offers extensive grinding service in-house, and also for other machine shops that lack grinding capabilities. Our centerless grinding services are for screw machine components such as input shafts, pump shafts, pins, and bushings.

High volume quality grinding is quickly becoming a lost art. But that is not the case at Ashley Ward. We have the skill and a knowledgeable employee base capable of getting the job done right.

At Ashley Ward, we can grind parts with diameters up to 3.5″ in both profile and through-feed centerless grinders. Our equipment is extremely versatile. So it allows for multiple grades of hot rolled and cold rolled steel, carbon steel, stainless steel, as well as aluminum parts to be machined.

We are highly trained experts in all three major types of grinding:

  • Through feed grinding
    • With this machine, the entire part can be placed through the grinder, and as a result, the part can be ground at its largest diameter.
  • Infeed grinding
    • Here we do just one portion of the part. There might be different areas that need different tolerances held, so this allows us to focus on one portion at a time.
  • Profile grinding
    • As the most complex of the grinding processes, profile grinding entails grinding multiple diameters on the same part- at the same time.

Let Ashley Ward know about the design specifications for your machine or part, and we’ll get started on creating your solution right away. Please visit our website, and request information today!

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Rolled or Cut? What’s the Best Way to Manufacture a Gear?

Manufacturing a gear can be done by rolling or cutting the application. It’s important to know that both processes have pros and cons, therefore understanding the differences will help to select which process will work best for you. By looking into factors such as the noise, heat, and tolerance levels, making an educated guess on which process to use can be much simpler.

Do you know what application the gear will be used in? That’s important to know in order to determine the sizing of the diameter. If oversized, it can result in distortion due to the intensity of the pressure. Gears are produced to mate with other gears; therefore, undersized diameters can develop functional problems. If manufactured incorrectly, performance issues can arise, thus causing problems throughout the application. When you cut a gear, you’re actually cutting and removing material.  A rolled gear forms the material into the gear shape.


When deciding which p
rocess suits your project best, it’s important to weigh the pros and cons of each process:

Rolled gears:

  • Rolling a gear involves compressing and moving materials, which makes them very durable.
  • The cycle time is much shorter, in comparison to cut gears.
  • They’re less expensive, generally half the price of cut gears.

Cut gears:

  • The American Gear Manufacturer’s Association (AGMA) sets the standards or precision between teeth for gears, which ranges between one and 14.  Anything above six requires the gears to be cut.
  • The cycle time per gear is approximately twice that of rolled gears.
  • Cut gears produce less vibration or friction, and therefore are quieter.
  • Cut gears produce less heat and offer a better fit with other mated gears.

As a service-oriented company, Ashley Ward is happy to educate you on both processes. We’ll provide alternative approaches, and recommend the most cost-effective solution. For more information on selecting the best way to manufacture a gear, please contact our Sales Tech, Larry Sutter at 513-398-1414 or email sales@ashleyward.com.

 



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Sending Work Overseas Doesn’t Pay

In the past, many manufacturing companies have sent work overseas in order to reduce labor cost. Recently, machine shops have been increasingly returning to the Midwest, due to concerns over quality and increasing total costs.  It has been realized that although it seems less expensive, outsourcing work overseas does not necessarily produce the results companies are looking for.

Companies thought that sending work overseas was less costly. But the question is: does the lower labor cost compensate for the poor quality of work that is received? When production takes place outside of the United States, companies are required to add a percentage of the overall cost to shipments. These costs compensate for quality adjustments, delivery problems, and supply chain issues.

As companies started calculating the actual cost difference, they started realizing that the savings were minimal – if at all. The economic advantage of doing business outside the US border has virtually disappeared.

Manufacturing in the US is making a comeback, and here’s why:

  • Freight: Shipping heavy parts from overseas is timely, and costly.
  • Inventory: Most companies need a high volume of machined parts, and if the parts are overseas, additional time is needed for transit.  Companies are required to increase inventory to compensate for possible delays in delivery.
  • Delayed response times: There is usually a 10 – 12 hour time difference when dealing with companies in Asia.  This makes communication difficult when there are issues.  It can sometimes take 24 hours just to get an initial response.
  • Core Competency: Machining isn’t every company’s specialty. By choosing a domestic company to machine parts, companies can close their machining facilities and outsource those functions to experts that are located nearby.
  • Expertise: Machine shops often have the necessary staffing infrastructure in place, and the engineering support is easily accessible since they are in the US.
  • Complex components: Complex parts can be sensitive to errors.  If technical issues come up, they can be dealt with in a timely manner.

Be sure to check back frequently for monthly post on industry trends, company information and more!

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We are the Production Outsourcing Experts!

If you outsource with Ashley Ward, you’ll have experts in the field producing your machined parts, and be able to focus on other important aspects of your business. We specialize in high-volume parts, but can take on any volume that your company requires.

We can transition equipment and part numbers from your facility to ours quickly and efficiently. Our history with companies like Maytag, Eaton and Whirlpool show that we know how to integrate new production, with minimal downtime. For example, a plant was being shut down and a partner was needed to run the machining in the interim; we were able to take over multiple operations.

If you’re looking for a domestic company to outsource your machining needs, it’s important to choose one who can handle the operations and volume you need.  Asking these questions can make the transition easier.

 

  • Can the machine shop handle multiple operations?
    • An agitator shaft on a washing machine must be machined, heat-treated, ground, and have a gear cut or rolled on the shaft. Can the shop handle all of these tasks?
  • Is the shop a one-stop option?
    • One-stop shops save time and money, and they prevent freight costs.
  • Does the shop do specialized work?
    • A shop’s ability to do induction heat-treating on shafts is important. In most cases, only a small area needs to be hardened, and by heat-treating only that area, the entire shaft is not subjected to the heat-treatment process.
  • What is the size of the shop?
    • Find out how many square feet and employees the shop has. Shops may not be able to take on a project that overwhelms its facility or requires it to increase the number of its employees by a large amount.
  • Does the shop have experience handling major outsourcing projects?
    • When looking for outsourcing options, make sure that the shop has successfully integrated other outsourcing projects.  Experience is essential to a smooth transition.

 

For more information please visit our website, and be sure to check back frequently for more industry-related blog topics!

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Ashley Ward: We’ll take the machining off your hands!

Founded by its namesake in 1908, Ashley Ward was the original proprietor of our well respected and well known company. In the 1930’s we began to get into machining and haven’t looked back since! However, it was the changing of the guards in the 1980s, when Ashley’s grandson Bill took over that has contributed to Ashley Ward becoming a major force within the industry. We currently employ over 200 people and have 5 locations.

We offer screw machine services including single spindle, multi-spindle, hydromat rotary transfer machine services, CNC machining, spline & thread rolling, gear hobbing & cutting, induction heat treating and centerless grinding. However, we specialize in production outsourcing.

In the case that a company is no longer interested in machining their products in-house, we are able to go in and move all of their machinery to our facilities where we can then continue production. Since we have a complete machine shop and such diverse capabilities, we are able to use our machines while we move yours! We can build a bank of inventory first and then move your machines in phases. Most other companies don’t have this capability, and as such you would lose valuable production time.

Visit the Production Outsourcing page of our website to read case studies about the work that we have done for Maytag and Eaton.

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