Board Buying
Made in America is Great – If You Can Do It
American manufacturers are throwing away business opportunities. Are you?
According to a recent statement by US Undersecretary of Defense for Acquisition and Sustainment Ellen Lord, national electronics procurement is at a crossroads.

“[America] can no longer clearly identify the pedigree of its microelectronics,” she said. “Therefore, we can no longer ensure that backdoors, malicious code, or data exfiltration commands aren’t embedded in our code.”

According to Lord, a variety of price pressures – ranging from government regulations to labor costs – have driven manufacturing of electronics offshore and created not only an economic imbalance but a security threat as well. “That’s what we need to reverse,” she said.

Like the Defense Department, American consumers also support bringing manufacturing back onshore. They believe the “Made in USA” slogan means saving American jobs and, often, superior quality of goods. They support “reshoring” – bringing the manufacturing and assembly of goods – back to the US.

But would that actually work? Would US PCB customers receive the same service from domestic sources they get from offshore assembly houses and manufacturers? Can domestic PCB suppliers keep up with demand and provide timely delivery?

The answer, unfortunately, is no, unless domestic firms make some critical changes.

Since the onslaught of tariffs and the Covid-19 pandemic, my firm has received many inquiries for new projects to be fabricated or assembled domestically, along with possibly reshoring ongoing work. It’s a noble intention, and we’ve been trying to help. We’ve reached out to more than a dozen North American PCB assembly houses and manufacturers to get work placed.

The experience has been a mixed bag, to say the least. Here is what we have encountered in our search for domestic shops:

  • Inflexible order sizes. Domestic companies with huge assembly operations seek large-volume orders and won’t quote a job less than about $2 million annually in revenue. On the other hand, most domestic fabricators prefer small to midrange run orders. They won’t take on customers with the mid-to-higher-volume business typically made offshore. Plenty of customers with orders in that range couldn’t place their business domestically even if they wanted to.

    That’s a shame. Offshore companies are aggressively quoting NPI programs. If China can compete on small lots, then the US should at least try to compete on big ones.

  • Inefficient quoting. I can’t tell you how many times after I have submitted an RFQ that I have to either follow up to confirm the RFQ receipt, or call weeks later looking for an update on the quote. And the US-based sales department frequently fails to communicate pertinent information to its quoting team, so the quote is inaccurate. Or a quote has been sitting overlooked on someone’s desk or in their email. I get better communication from companies on the other side of the world.

    Every assembly quote is different, each with its challenges. But like most processes in our industry, quoting should follow established procedures. What is your company’s policy for quote response time? (Do you have one?) How often do you hit your target? And when the promised response date has passed, do you always call the customer to notify them of the reason for the delay?

  • Refusal to quote. One shop I tried to get quotes from – a new state-of-the-art facility that touts its production capability – flat-out refused because they “don’t want to compete with China.” I explained the end-customer understands the price would be higher and still wanted a quote. The answer remained “no.” What’s going on here?

  • Poor customer service. Do you have problems with simple stuff, like getting people to respond to an email or return a call in a timely manner? Me too. There’s also a lack of urgency with the basics, like notifying customers about schedule changes or ensuring paperwork is correct.

    These are companies I’ve done business with before. In many cases, I personally know the owner. They know I have many customer contacts. If they treat me this way, how do they treat an unknown prospect?

  • Unwillingness to invest in technology. Because of customer requests, I’ve been trying to reshore existing volume orders, with some difficulty. One of my domestic board shop connections is an established facility known for large-volume orders. Unfortunately, this company appears averse to change, especially when it comes to upgrading the equipment needed for today’s technology that would permit it to compete globally.

    Investing in capital equipment isn’t cheap, but it is certainly more costly to our industry when domestic shops fail to meet the rising technology curve and cannot fulfill customer demands. Perhaps a collective could be formed to improve capital expenditure purchasing terms and, since hardly any PCB equipment is manufactured in the US, ensure a domestic ample inventory of spare parts. Investment in local personnel who could provide tech support for the equipment is also advisable.

When an OEM approaches me for help, I recommend a domestic source about 80% of the time. I’ve found that when a domestic supplier goes head-to-head with an overseas manufacturer – factoring in tariffs, minimum order values, overseas delivery, and time-zone delays – the total cost of ownership (TCO) for PCB assembly is comparable in the US to offshore.

(Many customers forget tariffs add to the bottom line. While 2- and 4-layer bare boards are exempt, 2- and 4-layer assemblies are subject to tariffs.)

Thus, it is even more frustrating when domestic assemblers refuse to accept quotes or fail to deliver decent service. The TCO often favors a domestic manufacturer – if an OEM can find one willing to build mid-to-higher volumes. American manufacturers are throwing away business opportunities.

Of course, many domestic PCB manufacturers and assemblers don’t have these problems. But if we want the broader industry to return to the US – instead of getting piecemeal jobs – we need to be willing to provide a comparable level of service to that of the overseas competitors.

Undersecretary Lord properly defines the goal, but I believe her solution focuses too much on pricing and not enough on the customer experience. US assemblers need to open their arms to potential customers. It will help both them and the US manufacturing situation at the same time.

Otherwise, OEMs and other board buyers will stick with offshore sourcing because they need to get their products built at a good price and in a timely manner. And “Made in America” will remain only a slogan from a bygone era.

Greg Papandrew headshot
Greg Papandrew
has more than 25 years’ experience selling PCBs directly for various fabricators and as founder of a leading distributor. He is cofounder of Better Board Buying; greg@boardbuying.com.