Login



For PLUS+ subscription assistance, contact customer service.

Not a PLUS+ Subscriber?

Become a PLUS+ Subscriber today and you'll get access to all Supply Chain Management Review premium content including:

  • Full Web Access
  • 7 Magazine Issues per Year
  • Companion Digital Editions
  • Digital Edition Archives
  • Bonus Email Newsletters

Subscribe Today!

Premium access to exclusive online content, companion digital editions, magazine issues and email newsletters.

Subscribe Now.


Become a PLUS+ subscriber and you'll get access to all Supply Chain Management Review premium content including:

  • Full Web Access. All feature articles, bonus reports and industry research through scmr.com.

  • 7 Magazine Issues per year of Supply Chain Management Review magazine.

  • Companion Digital Editions. Searchable replicas of each magazine issue. Read them in any web browser. Delivered by email faster than printed issues.

  • Digital Editions Archives. Every article, every chart and every table as it appeared in the magazine for all archive issues back to 2009.

  • Bonus email newsletters. Add convenient weekly and monthly email newsletters to your subscription to keep your finger on the pulse of the industry.

PLUS+ subscriptions start as low as $109/year*. Begin yours now.
That's less than $0.36 per day for access to information that you can use year-round to better manage your entire global supply chain.

For assistance with your PLUS+ subscription, contact customer service.

* Prices higher for subscriptions outside the USA.

PLUS+ Customer Service Support


Customer service for all PLUS+ subscribers is available Mon-Fri, 9am-5pm Eastern time.

Email: [email protected]
Phone: 1-800-598-6067 (1-508-663-1500 x294 outside USA)
Mail: PO Box 1496, Framingham MA 01701-1496, USA



You have been logged out of PLUS+


For PLUS+ subscription assistance, contact customer service.

Need to access our premium PLUS+ Content?
Upgrade your subscription now.


Our records show that you are currently receiving a free subscription to Supply Chain Management Review magazine, or your subscription has expired. To access our premium content, you need to upgrade your subscription to our PLUS+ status.

To upgrade your subscription account, please contact customer service at:

Email: [email protected] Phone: 1-800-598-6067 (1-508-663-1500 x294 outside USA)

Become a PLUS+ subscriber and you'll get access to all Supply Chain Management Review premium content including:

  • Full Web Access. All feature articles, bonus reports and industry research through scmr.com.

  • 7 Magazine Issues per year of Supply Chain Management Review magazine.

  • Companion Digital Editions. Searchable replicas of each magazine issue. Read them in any web browser. Delivered by email faster than printed issues.

  • Digital Editions Archives. Every article, every chart and every table as it appeared in the magazine for all archive issues back to 2010.

  • Bonus email newsletters. Add convenient weekly and monthly email newsletters to your subscription to keep your finger on the pulse of the industry.

PLUS+ subscriptions start as low as $129/year*. Start yours now.
That's less than $0.36 per day for access to information that you can use year-round to better manage your entire global supply chain.

This content is available for PLUS+ subscribers.


Already a PLUS+ subscriber?


To begin or upgrade your subscription, Become a PLUS+ subscriber now.

For assistance with your PLUS+ subscription, contact customer service.

Sorry, but your login to PLUS+ has failed.


Please recheck your login information and resubmit below.



For PLUS+ subscription assistance, contact customer service.

Chinese Contract Manufacturing

With changes in the business environment this is a good time to reconsider your CM business.

By ·
By ·

It’s 2015 and a good time to take a fresh view of your contract manufacturers (CMs) in China.  Business conditions have changed. Labor rates in China continue to rise. Logistics costs fluctuate with the price of oil. Data collection about forecasts, and operations continues to improve. Companies are considering Reshoring. All of these things will affect your relationship and operations at contract manufacturers.

Contract manufacturers provide engineering and manufacturing services to companies and brands that do not want to own and operate their own factories. Chinese contract manufacturers range in size from the giant Foxconn to small sewing shops in rural areas. CMs are typically experts in manufacturing and can quickly adopt your products into their manufacturing lines and schedules.  These companies are excellent at assembly and repeatable production and are the kinds of factories you often see in photographs where hundreds of young Chinese women are bent over assembly tables. 

With changes in the business environment this is a good time to reconsider your CM business. The first step is to review and reconfirm your business goals for contract manufacturing in China.  Assemble a cross-functional team of the stakeholders in your company and spend some time reviewing the current state of the business as well as your expectations for the coming year or two.

Next, consider changes in the Chinese business environment.  For example, as of January 1, 2015, a whole host of new environmental laws have taken effect in China.  The Chinese government is putting muscle into its efforts to clean up the environment and is starting to get tough with polluters.  Foreign corporations operating in China are receiving the brunt of regulatory oversight, but every foreign company using contract manufacturers is likely to get attention from the government and an environmental review.  Be sure to review your contract manufacturing sites regularly for safety and environmental compliance.

Consider your company’s strategy regarding Reshoring.  Reshoring is one of the hottest trends in US business. According to a recent study, 54% of manufacturers over $1 billion in revenues are considering or have started a Reshoring project. If your company has started to think about Reshoring, you will need to consider the impact such a strategy will have on your China operations and CMs.  Make sure you plan for the return of any tools, dies and molds that may have been transferred to China.

If you have employment contracts with your CMs and their employees, you need to understand the cost to buy out these contracts.  If volumes coming from China change, will this effect logistics contracts? Work with your legal department on these matters.

Use the information you have collected about logistics costs over time to chart the changes and analyze volatility.  Ask your freight forwarders and transportation carriers what they expect to happen in the future in terms of price changes.  With oil prices fluctuating, logistics costs from China will surely change.

Use the data you collect on CM operations including volumes and quality statistics, together with customer buying trends to determine what changes need to be made in your strategic plan.  Don’t be complacent about managing your China CMs.  Go to China every quarter for a business review with your CMs.  Now is a perfect time to plan for Q1.


About the Author

Rosemary Coates
Ms. Coates is the Executive Director of the Reshoring Institute and the President of Blue Silk Consulting, a Global Supply Chain consulting firm. She is a best-selling author of: 42 Rules for Sourcing and Manufacturing in China and Legal Blacksmith - How to Avoid and Defend Supply Chain Disputes. Ms. Coates lives in Silicon Valley and has worked with over 80 clients worldwide. She is also an Expert Witness for legal cases involving global supply chain matters. She is passionate about Reshoring.

Subscribe to Supply Chain Management Review Magazine!

Subscribe today. Don't Miss Out!
Get in-depth coverage from industry experts with proven techniques for cutting supply chain costs and case studies in supply chain best practices.
Start Your Subscription Today!

Article Topics

China · Labor · Reshoring · All Topics
Latest Whitepaper
2019 Top 5 Trends of Enterprise Labeling
This year’s sixth annual Top 5 Trends in Enterprise Labeling report outlines significant shifts in labeling that are impacting businesses and global supply chains at an unprecedented level.
Download Today!
From the January-February 2019
If history is our guide, economies take a turn every nine years. Yet time and again, a strong business cycle and fading memories convince us the good times will go on forever. Ten years after the great recession, we surveyed 100 manufacturing firms to find out if businesses are ready to fight through the next recession.
Truck Driver Shortage: No one behind the wheel
Intermodal to the rescue
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!


Latest Webcast
Leveraging the Internet of Things (IoT) in Manufacturing
Is Digital Transformation a risk or an opportunity? This webinar will detail Manufacturing industry challenges and how using IoT can address these challenges through optimizing logistics, improving processes and gaining meaningful insights.
Register Today!
EDITORS' PICKS
Supply Chain Management Issues Confronting Us This Year
A variety of fresh challenges will surface for global traders in January and beyond
Global Supply Chain Pricing May Face New Pressures in 2019
The global economy started 2018 with strong, synchronized growth, but the momentum faded as the year...

IHS Markit’s New Economic “Predictions” for 2019 and Impact on Global Supply Chains
The U.S. will remain “above trend,” while other key economies will experience further...
Global Kuehne + Nagel Indicators Signal Global Supply Chain Resilience
So far this year, international merchandise trade has risen by 10.6%. Emerging markets and North...