China has long been known as the "world's workshop," but did you know that manufacturing in China can also be a cost-effective way to boost your business? In this blog post, we'll discuss the benefits of manufacturing in China, and how Kingstec can help your company profit from the country’s leading contract manufacturers.
China is blessed with many natural advantages and this has helped it earn its place as the world leading manufacturing nation. These advantages were built on a number of solid foundations, and not temporary factors or trends, which means they will continue to drive the country’s success for the foreseeable future.
Most notably, China is home to the world’s largest manufacturing workforce, including millions of skilled, experienced engineers and tradespeople, such as tool and die makers. Many of these workers have spent decades working with sophisticated, state-of-the-art manufacturing equipment, including robotics and artificial intelligence. And despite this unmatched productivity and expertise, labor rates in China have remained competitive.
The country’s culture and dramatic transformation over the last three decades has also created a diverse and adaptable talent pool. As China’s way of life has changed rapidly, the labor force at all levels has had to become highly adaptive to change. They’ve also proven to be adept at learning new ways of working and mastering advanced technical skills, including being on the cutting-edge of manufacturing trends like the adoption of automation and robotics.
The recent WorldSkills Competition 2022 in Europe provided further evidence of China’s world-class talent; the country topped the gold medal tally, winning first place in 21 events, including mobile robotics, industrial control, computer numerical control (CNC), and cloud computing.
In today’s China, manufacturing growth is coming from high-tech sectors like information technology, aerospace, and biomedicine. In fact, high-tech manufacturing in China grew by 53% year-over-year in the first quarter of 2022.
Although countries in Southeast Asia, particularly Vietnam, are emerging as regional competitors, this is mainly for low-margin, labor-intensive processes. Generally speaking, southeast Asian industrial workers typically lack the technical skills and experience of their Chinese counterparts. They also would not have access to the sophisticated supply chain network and talent pool that China has developed in the last 30 years.
As a result, China’s contract manufacturers remain the preferred partners for high-quality, advanced components. This is partly due to the country’s highly skilled workforce and the fact that China is home to many of the world’s most efficient and dependable manufacturing facilities. Increasingly, though, the country’s adoption of advanced technologies have given it an edge, helping ensure quality and boost productivity.
This advantage looks set to continue. China is undergoing tremendous demographic shifts due to an aging population and growing middle class, and with highly competitive capital costs in the country, investing in new machinery and equipment is more affordable than in other countries.
These factors have encouraged China’s most progressive contract manufacturers to assemble technically advanced facilities and equipment that deliver unsurpassed quality. They have also helped China become the world’s largest market for robotics, which in turn has improved the country’s productivity and efficiency even more.
Leading-edge manufacturing equipment often incorporates vision technology and artificial intelligence, which enable robotics to work collaboratively and with greater precision, allowing for enhanced quality assurance. Robotic quality inspection, for example, is 20 times more efficient than traditional methods and has been shown to reduce quality assurance costs by over 95%.
China has a long tradition of building infrastructure to spur economic growth. For example, China has the world’s most advanced high-speed rail system and the world’s largest 5G network.
The Chinese government has committed to further investments in high-tech and advanced infrastructure to support manufacturing growth. Railways will expand by another 19,000 kilometers by 2025 and new access rail links will connect to 70% of the country’s coastal ports and 80% of its airport hubs.
At the same time, China is building 302,000 kilometers of new public roads. This includes 29,000 kilometers of expressways.
China is also the second-largest and fastest-growing aviation market in the world. The Civil Aviation Authority of China plans to open more than 270 civil airports by 2025 to support air cargo activities and business travel.
Because of its integrated, cutting-edge transportation network connecting advanced manufacturing facilities, China’s supply chain is more efficient and dependable than those of neighboring countries. Its advanced infrastructure can enable your company to complete all phases of its manufacturing processes in one country – often in one facility.
Dependable transportation helps ensure that your company can get its products to market on time. Working inside one country also eliminates customs hassles and other logistical headaches.
Competing countries in Southeast Asia simply can’t offer the same supply chain advantages. Although their labour rates for unskilled workers may be lower, in the long run, it pays to produce sophisticated, high-quality products in China.
These natural advantages make partnering with Chinese contract manufacturers the logical choice for offshore manufacturing. At the same time, China has become a complex and dynamic market that can be challenging to decipher. Kingstec and our partners have the advanced technologies and dependable work force your company needs.
Kingstec has worked with China’s leading facilities for over 40 years and can help your business navigate this exciting space, acting as an extension of your mechanical and electrical engineering, design, and logistics departments.
Call us today to learn how your business can partner with China’s world-class, cost-efficient manufacturers.
