Manufacturing Trends in North America

Manufacturing is the backbone of the American economy. It’s driven growth, created jobs, and fostered innovation. Through the years, there have been expansions in the industrial landscape to include Mexico and Canada, making North America a manufacturing powerhouse. As consumer demand drives speed and innovation, manufacturing companies must adapt to new technologies and trends to survive.

The History of Manufacturing

Though many products sold on the North American market are manufactured internationally, manufacturing in North America has a history nearly as old as the United States itself. The history of domestic production has evolved over centuries, adapting to technological advances, economic shifts, and global trade dynamics.

In 1964, the Maquiladora Program was established in Mexico, marking a significant development in the North American manufacturing landscape. Maquiladoras operate under preferential tariff programs agreed upon by Mexico and the United States, which allow equipment and materials to enter Mexico without being taxed. The program allowed maquiladoras to be completely foreign-owned. Many maquiladoras are located near the US-Mexico border to reduce transportation time and costs.

Trade agreements, such as the North American Free Trade Agreement (NAFTA), have also made it easier to expand manufacturing geographically. Now updated and replaced by the United States-Mexico-Canada Agreement (USMCA), these agreements have facilitated the geographical expansion of manufacturing operations across North America by reducing trade barriers, standardizing regulations, and providing greater market access.

Offshore manufacturing in Asia grew in popularity in the 1970s. There, companies found skilled workers for low wages. However, shipping and production costs have risen in recent years, and tariffs have been enacted to discourage reliance on foreign-produced goods.

The Impact of COVID-19

For all the economic benefits of international manufacturing, COVID exposed its weaknesses. During the pandemic, supply shortages were common. Many companies produced their products in Asia and could not get them to the US within the planned time frame. More and more companies are showing renewed interest in domestic manufacturing. At the same time, the manufacturing industry is also becoming more digitized and adapting to consumer demands.

Smart Factories

Technology has made significant advancements over the past 20 years. From smartwatches to smart homes, nearly everything can now be connected to the Internet of Things (IoT). Now, interconnectivity is going past consumer electronics and into the factories that produce them.

Industrial IoT

Factories that implement Industrial IoT (IIoT) use software that connects data from all facets of the factory. Companies can track every step of a product’s journey in one place, monitor machines and facilities, and identify problems. IIoT also allows these factors to be monitored remotely.

Artificial Intelligence

AI can draw analytics from centralized data, allowing it to address problems before they happen. Machine learning is a fundamental subfield of AI in industrial applications. It is the process by which machine systems use data to optimize processes, leading to higher quality and efficiency.

Factories also use AI to monitor inventory. Sensors can track the quantity and location of parts, providing real-time updates. With remote monitoring of interconnected devices, companies can track inventory and productivity anywhere.

Digital Twins

A digital twin is a real-time representation of a system. Unlike a digital prototype, which can be updated by designers but is not connected to live data, a digital twin is connected to its physical counterpart through sensors and IoT. The digital twin continues to be used throughout a product’s life cycle. It simulates system behavior and can run scenarios to identify potential issues.

Digital twins are not just made for products. Process twins can reveal how to increase efficiency using IoT data and diagnose problems. With process twins, bottlenecks and inefficiencies in operations can be identified faster than ever before.

Pick and Place Machines

SMT pick and place machines have been widely used since the 1980s and are still a mainstay in today’s smart factories. Pick and place machines scan PCBs to identify where components need to be placed. The machines then position the pieces on the board more efficiently and precisely than human assembly. The most common pick and place mechanism is the robotic arm, which uses grippers or a vacuum nozzle to move components, but some companies opt for delta or fast pick robots for their increased speed.

Sustainability

The percentage of consumers who care about sustainability in their products has increased since the pandemic. The pandemic brought awareness to global challenges, including environmental issues. As a result, more companies are creating environmental, social, and governance (ESG) goals. These goals often encompass ambitious targets such as achieving carbon neutrality, incorporating recycled materials into products, and adhering to sustainable manufacturing processes.

Smart factory technologies can also contribute to sustainability initiatives. Optimization leads to more efficient energy use. Digital twins allow companies to analyze and optimize their operations by creating virtual replicas of physical processes and systems, significantly reducing material waste and resource consumption. The combination of heightened demand for sustainable products and the adoption of advanced technologies is driving a significant transformation in how companies approach sustainability.

From B2B to B2C: A Shifting Industry

Advancements in technology mean that brick-and-mortar stores may be going by the wayside. With the popularity of online retail and new supply chain strategies, companies that have traditionally followed a B2B model are shifting to B2C, shipping items out directly from their factories and warehouses instead of going through a separate retailer.

Skilled Labor Shortage

As companies relocate international manufacturing operations to North America, they encounter a significant challenge: a shortage of skilled laborers. To address this shortage, companies must invest in their employees through competitive wages, training programs, and safety.

In North America, manufacturing is seen as dangerous, dissuading potential employees. Prioritizing safety is vital to attracting and retaining skilled workers. Identifying risks before they happen invests in employees and keeps operations running smoothly. Protocols, training, and wearable safety devices are all measures that can be taken to create a safe workspace.

Supply Chain Trends

The 2021-2023 supply chain crisis brought the general public’s attention to the logistics behind their products. Globally sourced and manufactured parts were delayed or unable to make it to North America, causing disruptions.

Reshoring

Though the supply chain crisis has passed, there are still long lead times and parts shortages that can delay production for months. North American companies have taken to reshoring. Reshoring enables manufacturers to deliver products faster, cutting down on lengthy shipping times that can be further delayed by international political disruption. Reshoring also creates more jobs for North Americans, and companies avoid import and export taxes by manufacturing domestically.

Transparency

Companies must have complete visibility into every aspect of their supply chain. Working with a manufacturing partner that is invested in a digital supply chain gives access to technologies and analytics that will better prepare you for disruptions. Blockchains are used in supply chain management to track all supply chain transactions in a fixed ledger. As a decentralized network, the blockchain can be viewed by all authorized users, providing transparency.

Just as factories are embracing IoT, supply chains are embracing cloud computing. Cloud computing allows companies to store information on parts availability, inventory levels, and tooling on the cloud. At Pivot International, we use cloud computing to track the progress of our customers’ projects. We monitor when parts are nearing their end-of-life so that we can instigate a redesign early enough to avoid production delays. The supply chain is also becoming more automated at the factory level. Machines connected to the IoT are automated to carry out processes efficiently.

Keeping up with Industry Changes

It is important to be aware of trends and innovations in your industry. Reshoring may not be the solution for everyone, but smart factories, sustainability, and the IoT are all a significant part of the future of manufacturing. Partnering with a manufacturer that has implemented these practices is vital to efficiently producing a successful product.

Pivot International has six manufacturing and assembly sites in the United States. With 17 fully automated SMT lines, we can help with your manufacturing needs. In addition to our US sites, our company DCI has a 38,000-square-foot manufacturing facility in Juárez, Mexico. Headquartered in Lenexa, Kansas, our global supply chain team gives our partners real-time information on their products. Contact us to learn more about how we can be a solution for your modern manufacturing needs.

Unlocking Success in Consumer Electronics: Your Manufacturing Partner Holds the Key

Developing a consumer electronic product can be exciting, but navigating the complexities of design, engineering, and production can be daunting for any company. Whether you’re a startup or an established company aiming to expand your product line, the journey from concept to market-ready device can be challenging. Partnering with an established product development company can be the key to unlocking your product’s full potential and bringing it to market quickly and efficiently.

Benefits of Partnering with a Product Design Firm

There are several things to consider when deciding whether or not a partnership will benefit your company. If you or your team lacks the knowledge to bring a product from concept to production, reaching out to an established product development company is in your best interest to see what benefits they offer. Some of these might include:

Expertise and Experience: Established product development companies have a wealth of experience across many consumer electronics categories. They can guide you through the entire process, from concept and design to manufacturing and launch. Their teams typically consist of engineers, designers, and project managers who have worked on many projects, giving them the insights needed to overcome hurdles efficiently.

Reduced Time-to-Market: Time is of the essence in the consumer electronics industry. With a dedicated product development partner, you can streamline the development process, reducing time to market. Their structured approach and access to resources and technology accelerate the journey from concept to product launch. All of this will give you the competitive edge on your competition.

Cost Optimization: While it might seem counterintuitive, partnering with a product development company can lead to cost savings in the long run. Product development companies can help you identify cost-saving opportunities throughout the process, from material selection to manufacturing negotiation. Their economies of scale, established supplier relationships, and streamlined processes enable efficient resource utilization, ultimately translating into cost optimization for your project.

Risk Mitigation: Their engineering expertise can help you avoid potential pitfalls and ensure your product meets all safety and regulatory requirements. Developing consumer electronics often requires specialized resources such as advanced manufacturing equipment, testing facilities, and regulatory expertise. Product development firms typically have access to these resources, sparing you the need to invest in them individually.

Scaling Production: Where to Manufacture Your Product?

Scalability in manufacturing simply means the ability to adjust your product’s production in response to changes in demand or other factors without taking on excessive costs or disruptions. In consumer electronic products, scalability is crucial due to the dynamic nature of the market. Consumer preferences, technological advancements, and market demands can vary significantly over time. If your product is out of stock or has long shipping times, chances are your customer will purchase a similar product they can get delivered within a few days.

All of this and more are reasons why designing manufacturing processes with scalability in mind allows companies to efficiently ramp up production to meet high-demand periods or scale down during slower periods without compromising quality or incurring significant expenses.

An experienced product development partner will be able to provide scalable manufacturing, both domestically and internationally, to provide options for your budget. Let’s look at a few pros and cons of domestic vs. international manufacturing.

Domestic Manufacturing:

Pros:

• Shorter Lead Times
• Greater Quality Control
• Easier Communication & Travel
• Potential Tax Incentives

Cons:

• Higher Production Costs

International Manufacturing:

Pros:

• Lower Production Costs
• Access to More Skilled Workforce
• Access to a Wider Range of Manufacturing Capabilities
• Potential Tax Incentives

Cons:

• Longer Lead Times
• Potential Language and Cultural Barriers
• More Regulations on Imports/Exports

Choosing the Right Partner for Your Consumer Electronic Product

Ultimately, the decision is yours, whether partnering with a product development company is beneficial to your product or company. A reputable product development company can help you weigh the pros and cons of each option and develop a manufacturing strategy that aligns with your budget, timeline, and quality expectations. They can also help navigate the complexities of international manufacturing, including managing logistics and ensuring compliance with regulations. Doing this internally could add valuable time and money to your product launch timeline.

Developing a successful consumer electronics product requires expertise, resources, and strategic planning. Pivot International has provided guidance, support, and access to our global resources for over 50 years. Our company is set up in a way that helps our customers when and where we are needed throughout the entire product development process. We can help you navigate through the complexities of the process. By leveraging our expertise in both product development and manufacturing, you can bring your innovative idea to market faster, more efficiently, and with greater confidence. We provide electronic manufacturing services throughout North America, Europe, and Asia. By choosing us as your product development partner, you will have access to our global team of over 150 multi-disciplined engineers, global supply chain teams, and project managers. Contact us today to learn more about our services.

Understanding PCBs and Choosing an Engineering Partner to Ensure Your Product’s Success

Printed circuit boards (PCBs) are essential components of electronic devices. They are used to connect and route electrical components with each other and interact with the end user. PCBs are everywhere in modern technology, and their design and fabrication have become increasingly sophisticated. Designing a PCB requires both technical knowledge and creativity, as it involves translating a schematic into a physical layout. In this blog, we’ll discuss the basics of PCB design and the questions you should ask an engineering partner when developing a new product.

PCB Design Basics

A printed circuit board (PCB) is a board made of insulating material (usually fiberglass or plastic) with conductive pathways etched onto its surface. The conductive pathways (or traces) are usually made of copper and are used to connect various components of an electronic circuit. The PCB provides a physical structure for the components to be mounted on and connected to one another.

PCB design involves creating a schematic diagram of the electronic circuit and then laying out the physical components on the PCB. The designer must ensure all components are properly connected and the PCB is optimized for the desired functionality, size, and cost.

Factors to Consider when Designing a PCB

Electrical Requirements – The designer must ensure the PCB meets all the circuit’s electrical requirements. This includes maintaining the proper voltage, current, and resistance are maintained throughout the circuit. Failing to do this can result in frying the board and circuitry, which can be a costly mistake.

Mechanical Requirements – The board must fit properly inside the device and be able to withstand any mechanical stresses or vibrations that may be encountered during use.

Thermal Requirements – The board must be able to dissipate heat properly and withstand temperature changes that may be encountered, without altering performance.

Manufacturing Requirements – In order to produce your electronic product in large quantities, it’s important to design the board so it can be produced quickly, efficiently, and at the desired cost.

Regulatory Requirements – Depending on the use of your new product development will determine what regulatory requirements or certifications will be involved before going to market. If your PCB isn’t designed with these requirements in mind, your product will fail, and the whole design process will start over.

Questions to Ask Your Engineering Partner

When developing a new electronic product, it’s essential to work with an experienced engineering partner who can help you design and manufacture your innovation. Now we will discuss some questions you should ask your engineering partner, to ensure your PCB meets all the necessary requirements.

What is your experience in electronic design?

Working with an engineering partner who has vast experience designing PCBs for similar devices is vital. This will ensure they understand the unique requirements of your device and can design a PCB that meets your needs.

Pivot International has over 50 years in business designing electronic components and PCBs. Our electrical, mechanical, and software engineers work closely to ensure the board design is connected seamlessly to the product requirements.

How do you ensure the board meets all necessary requirements?

Your engineering partner should already have a team in place to ensure your design will meet the necessary requirements, including electrical, mechanical, thermal, manufacturing, and regulatory requirements.

Pivot offers global teams that are experts in each of their disciplines and work together to fulfill our customers’ product development needs.

What tools do you use for board design?

Your partner should use the latest tools and software for PCB design. This will ensure the design is optimized for functionality, size, and cost. There are many software tools available for creating schematics, including popular options like Eagle PCB, Altium Designer, and Mentor PADS.

How do you guarantee the PCB can be manufactured at the desired cost?

Your engineering partner should have experience designing PCBs that can be manufactured at the desired cost. This includes optimizing the design for the chosen manufacturing process and minimizing the number of components and layers.

Pivot has global supply chain teams across the US, Europe, and Asia, that offer the most cost-effective solution to meet your product requirements. We own manufacturing facilities throughout North America, Europe, and Asia. We also have mirrored SMT lines in North America and Asia to ensure a seamless transfer of design and manufacturing processes, should you need to scale your product from one location to another.

How do you ensure my board design will meet all the necessary safety and environmental requirements?

Your partner should have experience designing PCBs that meet all the necessary safety and environmental requirements. This includes ensuring that the PCB uses the appropriate materials and will meet all necessary certifications.

With our vast experience and global teams, we’ve worked on projects consistent with the requirements of ISO 9001, ISO 13485, ISO 80079, IEC 600101, UL-listed, CSA Approved, and ATEX and IECEx-compliant.

What is your process for testing and validating the PCB design?

There should already be processes in place for testing and validating PCB designs that your engineering partner can offer to you. This includes testing the board for functionality, performance, and reliability. They should also have a process for identifying and addressing any issues that arise.

At Pivot, we develop customized test procedures that map directly to our customer’s product requirements.

How do you ensure that the PCB can be scaled for production?

If your device will be produced in large quantities, it is important to work with an engineering partner who can design a PCB that can be easily scaled for production. This includes optimizing the design for the chosen manufacturing process and ensuring that the PCB can be manufactured in large quantities without any issues.

Our engineers design with manufacturing in mind. Our design for manufacturing (DFM) practices are integrated throughout the entire product development process.

How do you handle changes to the PCB design?

It is common for changes to be made to the PCB design during the development process. Your engineering partner should have a process in place for handling these changes, including assessing the impact of the change on the overall design and ensuring that the change meets all the necessary requirements.

We offer a world-class project management team that work closely with each client to ensure all aspects of your product are thought through from initial concept through production. We will address all product angles at the start of the project, to help mitigate changes that could disrupt the design and production process.

Looking for a PCB Design Partner?

To summarize, PCB design is critical to developing any electronic device. Working with an experienced engineering partner is essential to ensure success, lower risk, and increase your ROI. By asking the right questions, you can ensure your engineering partner understands your product and can design a PCB that meets all the necessary requirements.

If you would like to learn more about Pivot International, our global companies, and how we can help take your electronic product to market, contact us today. We offer a free consultation with our project management team and groups of engineers that are eager to turn your idea into a reality.

3 Benefits of Choosing a Manufacturing Partner with Mirrored SMT Lines

Having a product in stock and readily available to purchase is vital in this fast-paced world. Consumers have grown accustomed to having the world at their fingertips and products being delivered to their door within hours of purchase. In order to ensure your new product development (NPD) can keep up with demand, it should be designed with scalable manufacturing in mind.

Scalable manufacturing is the ability to quickly and efficiently increase or decrease the production of a product in response to changes in demand. Your product should be designed for manufacturing (DFM) to ensure an efficient and cost-effective production. In this article, we will discuss how choosing a partner with mirrored SMT lines can provide a number of advantages for your NPD.

What are Mirrored SMT Lines?

Surface Mount Technology (SMT) is an electronic assembly process where components are mounted onto the surface of a printed circuit board (PCB) using a pick-and-place machine. This technology produces highly complex and densely packed PCBs, commonly used in various electronic products, from smartphones to medical devices.

Most electronic manufacturers will have mirrored SMT lines. This essentially is two or more machines, independent from one another, that are identical in setup and can perform the same assemblies simultaneously to increase output.

Pivot International has two facilities with state-of-the-art mirrored SMT lines at Pivot EDM and Pivot – Hawks Manila. EDM is located in the American Midwest, while Pivot – Hawks Manila is located in the Philippines.

Benefits of Mirrored SMT Lines

1. Production Flexibility and Scalability

One of the key benefits of mirrored SMT lines is that it allows for greater flexibility and scalability in the production process. By having two or more SMT lines that are identical in terms of equipment and capabilities, the manufacturer can easily switch between different production runs or increase the volume of goods being produced without the need for significant downtime or retooling. This can save both time and money and allows for a more efficient and responsive manufacturing process.

2. Product Reliability and Consistency

Another advantage of mirrored SMT lines is that they can provide a higher level of reliability and consistency in the production process. With identical equipment and processes being used on each line, manufacturers can ensure that the quality of the finished goods is consistent, regardless of which line they are produced on. This can be especially important in industries where product quality is critical, such as the medical or aerospace sectors.

3. Increased ROI

In addition to the operational benefits, choosing a manufacturer with mirrored SMT lines can also provide financial advantages. Because mirrored lines allow for greater flexibility and scalability in the production process, manufacturers can often offer more competitive pricing to their customers. This can be particularly beneficial for businesses that are looking to source goods in high volumes or that require a rapid turnaround on their orders.

Global Mirrored SMT Lines

As previously discussed, Pivot offers our customers global mirrored SMT lines. This allows our US-based customers to produce a small inventory run at EDM, then perform testing before producing their product on a large scale at our facilities in the US or the Philippines.

In the case of a natural disaster in one country or location, production can quickly resume in the other. This completely eliminates the need to search for another manufacturing partner as well as the setup time needed for software integration and tooling.

Choosing the Right Manufacturing Partner

Ultimately, the decision to choose a manufacturing partner with mirrored SMT lines will depend on the specific needs and goals of your business. However, the benefits of greater flexibility, reliability, and cost-effectiveness heavily outweigh the alternative. By partnering with a manufacturer that has mirrored SMT lines, businesses can gain access to a more efficient, reliable, and cost-effective production process, allowing them to better respond to changes in market demand and stay ahead of their competition. If you would like to learn more about Pivot’s global mirrored SMT lines, contact us today for a free consultation.

Product Scalability Depends on Design for Manufacturing

As our world becomes more connected and technology advances at a rapid rate, businesses must focus on developing products that can meet the needs of company growth and consumer demand. This refers to the term scalability.

In this article, we will discuss how the success of a new product directly correlates to the design for manufacturing that goes into that product when it’s time to ramp up production.

Scalability in Product Development

When designing and developing a new product, scalability is essential to its success. It allows businesses to seamlessly expand their operations to meet the needs of their customers. To ensure a higher potential for success in the market, your product must handle increased demand without negatively affecting its performance, quality, or reliability. This is where design for manufacturing comes into play.

Designing Your Product with Manufacturing in Mind

What is Design For Manufacturing?

Design for manufacturing (DFM) is a critical aspect of product development that directly affects a product’s scalability. DFM is the process of designing products that can be efficiently and cost-effectively manufactured. By designing with manufacturing in mind, businesses can optimize their production processes and reduce the cost and time required to bring a product to market and into customers’ hands.

DFM involves considering various factors such as material selection, part design, assembly processes, and quality control. By designing products with these factors in mind, businesses can ensure their products are scalable and can be manufactured efficiently at high volumes.

Choosing Materials for Scalability

One key aspect of DFM is material selection. Choosing the right materials for a product can significantly impact its scalability. Materials that are difficult or expensive to obtain, process, or manufacture can limit a product’s scalability, as they may not be available in the quantities needed to meet increased demand. With the global supply chain issues that have plagued the world over the past few years, this is inevitable. Choosing the wrong materials can postpone production for months, if not years.

Additionally, materials prone to defects or inconsistent properties can negatively affect a product’s reliability and performance, making it difficult to scale. By choosing materials that are readily available, cost-effective, and have consistent properties, businesses can ensure that their products can scale without sacrificing quality or performance. Materials that are easy to work with, readily available, and affordable are typically the best choice for scalable products.

Product Design in DFM

The design of your product is fundamental when you’re looking to scale. How each component interacts with one another, the spacing between individual parts, and how quickly it can be assembled all impact the ease of scalability and production time. Parts that are overly complex or difficult to manufacture can limit a product’s scalability, as they may be time-consuming or expensive to produce at high volumes.

On the other hand, parts that are simple and easy to manufacture can be quickly and efficiently produced, allowing businesses to scale their operations as demand increases. It’s essential to the success of your product to utilize highly skilled product designers with DFM expertise to ensure you do not waste time and money getting your product into production.

Assembly Process for Efficient DFM

In conjunction with a product’s design, how your product gets assembled directly ties to its success. Assembly processes that are overly complicated or time-consuming can limit a product’s scalability, as they may be unable to keep up with increased demand. Products that require human touch to assemble often take valuable minutes to produce. Multiplying these minutes by the number of units produced will extend your time to market by months.

By designing products with manufacturing and scalability in mind, businesses can optimize their assembly processes and ensure they can scale efficiently. Often, companies will outsource their manufacturing to a partner with the machinery and processes in place. This will save you time, money, and an added layer of assurance.

Quality Control

Finally, quality control is a crucial aspect of product development but is often overlooked when it comes to DFM and scalability. As a product scales, maintaining quality control becomes increasingly challenging, as there are more opportunities for defects and errors to occur. By designing products with quality control in mind, businesses can implement processes and procedures that ensure consistent quality, even as demand increases.

Successfully Scaling Your NPD Through DFM

Scalability is not only crucial for the growth of a business, but it also plays a critical role in the success of a product. Products that can scale efficiently can meet the demands of their customers and adapt to changing market conditions. Additionally, scalable products are often more cost-effective to manufacture, allowing businesses to remain competitive and profitable.

One example of a company that has successfully designed scalable products is Apple. Their products, such as the iPhone and MacBook, have scaled to meet the demands of millions of users worldwide. Apple’s design philosophy focuses on simplicity, ease of use, and reliability, which has allowed them to create products that are not only scalable but also highly desirable.

Apple’s products are also designed with manufacturing in mind, allowing them to be produced efficiently and cost-effectively. By choosing readily available materials and designing parts and assemblies that are easy to manufacture, Apple can produce its products at high volumes while maintaining consistent quality. All these things have helped elevate their products and brand to the high-quality status it is known for today.

Choosing a Partner with DFM Expertise

In conclusion, scalability is a critical aspect of DFM in product development. It ensures that a product can grow with demand, making it more successful in the market. By partnering with a company with advanced DFM expertise, you will ensure your product is designed with scalability in mind.

Pivot has over 50 years of experience bringing products to market. We have a team of engineers that work closely with our company-owned manufacturing facilities throughout North America, Europe, and Asia. To learn more about how we can help design your next product, contact us today.

Electronics Manufacturing in the Midwest: The Unexpected Path to Success

When you think of major centers for electronic manufacturing, Silicon Valley and Southeast Asia probably come to mind, which makes sense as so many tech companies are located in those regions. It’s unlikely you’d consider the American Midwest to be the best place for manufacturing high-tech electronics, but you should. The Midwest offers significant benefits over coastal cities and overseas manufacturing facilities when it comes to the production of electronic components and systems.

New Product Development Cost

Cost is usually the main concern at the start of any new product development project. While it’s important to keep expenses low, producing a quality product is equally important. Manufacturing in the Midwest allows for both; product costs remain low for consumers, and the profit margin stays healthy.

When you have complex electronic products to produce, choosing a manufacturer with low overhead is particularly beneficial. The lower cost of living in the region keeps manufacturing costs reasonable (including labor costs), which translates to product costs that maximize value.

Conversely, outsourcing manufacturing to international partners may mean lower labor rates, but global tariffs and shipping costs will quickly offset those expenses. Additionally, it’s much easier to monitor the production process of your new product when it’s happening here in the United States; doing so will allow you to retain a solid balance between low manufacturing costs and reliability.

NPD Logistics

There’s a reason companies like UPS and FedEx choose to house their largest distribution centers in centrally-located cities. The Midwest is simply better positioned logistically. It offers well-established distribution networks to move freight with ease. Therefore, the production process is more efficient and cost-effective.

The Speed of Production

Because the Midwest is so logistically sound, production times tend to be faster. Since the entire process is more efficient, it’s not uncommon for midwestern manufacturing facilities to complete projects weeks or months ahead of schedule. These companies don’t have to worry about tight employment demands, constant heavy traffic hindering shipping, and other issues that are prevalent in coastal cities.

Skilled Labor in the Midwest

You can get skilled manufacturing labor anywhere. It’s not exclusive to the Midwest, however much of the regional economy is based on production in warehouses. Compare that to the largely service-based employees and white-collar professionals of the west coast, and you get highly skilled production labor at a fraction of the price.

Consolidated Manufacturing Processes from One Source

When it comes to electronics, the manufacturing process is highly complex yet vital to the success of your product development. Consumers are becoming even more price-conscious. By partnering with a company specializing in manufacturing, with particular expertise in Design for Manufacturing (DFM), and locations throughout the globe, will extend price savings to not only your company but your customer.

Pivot International owns our own manufacturing facilities throughout three continents with scalable manufacturing in the Midwest. We have global engineering teams to help with the design of your product and offer a highly skilled project management team that can guide you through the entire product development process. Learn more what our team can do for you. Contact us today.

How to Take Your Product Into Manufacturing

If you’re a startup, or you’re just getting ready to release your company’s first product, the manufacturing process can seem overwhelming. The entire process of new product development (NPD) can be difficult to get right the first time.

At Pivot International, we have over 50 years of experience bringing products into manufacturing. With our global supply chain and manufacturing facilities spanning three continents, we truly are experts in this field. With our one-source business model and proven design for manufacturing (DFM) expertise, let us help you take the stress out of bringing your product to market.

Let’s discuss the steps needed to take your product into manufacturing.

Finalizing Your Product Design

First, you’ll need to finalize your design. This means ensuring your product has all the features and functionality you and the consumer want and that it’s been designed in an easy and cost-effective way to manufacture. You should also consider factors like durability, reliability, and aesthetics, as these can all affect your product’s success in the market.

To do this, you’ll need to do some research and development (R&D). This can involve testing your product’s design through prototyping and iterating on the design based on the results of those tests. Consider consulting with experts in the field, such as industrial designers or engineers, to get their input on your design.

Ensure your product’s design is simplified in order to manufacture it. Working with a company that has experience in DFM will lower the cost of production, allow for faster production times, and improves the quality of your product.

Choosing the Right Manufacturer

Once your design is finalized, it’s time to find a manufacturer. There are many different types of manufacturers out there, and the one you choose will depend on factors like the type of product you’re making, the volume of units you need, and your budget. Some common types of manufacturers include contract manufacturers, original design manufacturers (ODMs), and original equipment manufacturers (OEMs).

When choosing a manufacturer, it’s essential to do your research and compare quotes from multiple manufacturers. You’ll want to consider factors like the manufacturer’s experience, reputation, and production capabilities. If the manufacturer owns their own facilities vs. outsourcing to a third-party manufacturer. You should also visit the manufacturer’s facilities in person, if possible, to see their operations firsthand and make sure they’re a good fit for your product.

Creating a Production Plan

Once you’ve chosen a manufacturer, you’ll need to create a detailed production plan. This plan should include all the information the manufacturer needs to produce your product, such as the bill of materials (BOM), factory assembly drawings, work instructions, and any quality control measures that will be put in place. You should also include information on certifications or compliance requirements your product may have, such as FCC or UL certifications.

Once your product is manufactured, it’s time to bring it to market. This can involve a number of steps, such as packaging and labeling your product, creating marketing materials, and setting up a distribution channel – to name a few. You’ll also need to consider how you’ll price your product and handle customer service and support.

Communication is Key

To ensure the success of your product, both parties must stay engaged throughout the manufacturing process. This means communicating regularly with your manufacturer and providing them with any updates or changes to your design or production plan. The manufacturer should also be responsible for openly addressing any issues that arise, such as quality control problems or delays in production.

Manufacturing Doesn’t Have to be Complicated

Taking your product into manufacturing is a complex process that requires careful planning and coordination. By following these steps, we hope we’ve provided a clearer path on how to manufacture your new product.

If you’d like to learn more about our manufacturing processes, contact us today!

Is US Manufacturing Self-Sufficiency Really the Answer?

The US federal government has now invested billions in bringing manufacturing back home. In response, manufacturing titans, including Intel, Samsung, and TSMC, currently have new US fabrications under construction. The Biden Administration’s 2021’s report, Building Resilient Supply Chains, Revitalizing American Manufacturing, and Fostering Broad-Based Growth, arose in response to escalating supply chain disruption and semi-conductor shortages. Many would say it reads like a virtual manifesto for US manufacturing self-sufficiency.

At Pivot International, we are a US-based one-source product development firm with advanced DFM expertise and 320,000 square feet of global EMS capability, including options in the Philippines and the American Midwest. We are proud to carry on the Made In the USA tradition while providing clients with globally diversified sourcing solutions. As we continue contributing to the industry conversation on the future of American manufacturing, we hold the position that US interests are best served with a balanced perspective on the benefits vs. risks of reshoring.

The Question of Self-Sufficiency in US Manufacturing

Reshoring chip production from Taiwan and electronics manufacturing from China to the US and its allies holds industry-changing impacts, geopolitical risks, and economic uncertainties. The question remains whether US manufacturing self-sufficiency is desirable, much less achievable. Arguments in favor of a more balanced (and therefore sustainable) approach to supply chain resilience include the following objections:

• With demand increasing across multiple economic sectors, it seems dubious that a singular focus on increasing domestic supply capacity can result in long-term resilience.
• Global value chains appear too intertwined to be meaningfully decoupled without incurring second-order consequences.
• An excessive emphasis on reshoring runs the risk of further politicizing global supply chains and is a recipe for a second cold war.
• There are potentially irresolvable tensions between reshoring and environmental sustainability.

These objections reveal that while increasing US manufacturing capability across all sectors is critical, it’s only half the story. To foster more resilient supply chains, drive economic growth, establish greater national and geopolitical security, and reach sustainability goals, the terms of globalization must not be abolished but instead rewritten. This means preserving the benefits of an interconnected world and global economy while taking strategic steps to better mitigate risk.

Advantages of Domestic Manufacturing

The superiority of offshoring is often tacitly assumed. But in select cases, domestic manufacturing can be an even more cost-effective solution. Advantages include:

Eliminating Ocean Shipping Costs

Ocean shipping costs broke the sound barrier in 2021 when carriers made $190 billion profit — seven times more than the year before. And in the wake of the “Containergeddon” scenarios that plagued supply chain in the spring of 2022, domestic manufacturing is becoming an increasingly sought-after option for cutting soaring shipping costs.

Avoiding VAT (Value Added Tax) and Reducing Tariffs

Almost all countries levy VAT. Because VAT is levied on nearly every link of the supply chain, companies often fail to factor how deeply it can impact their margins. Fortunately, the US is one of the few countries that does not levy VAT, enabling companies who opt for domestic manufacturing to avoid these dings to their investment. Working with a domestic supplier also allows companies to avoid tariffs.

Why MidWest Manufacturing is the Most Competitive Domestic Option

Midwest manufacturing is almost always a superior choice to coastal manufacturing for three reasons. First, because the Midwest functions as the country’s logistics and e-commerce hub, it outperforms the “In” and “Out” costs of almost everywhere else in the country.

Second, coastal cities are extremely expensive, driving up operational costs for coastal manufacturing facilities that are passed along to the customer. When companies consult with Pivot to determine what combination of domestic and offshore manufacturing options will best fit their needs, they are often pleasantly surprised to find we can beat the price of coastal quotes significantly.

Last, working with a Midwest partner affords the benefit of making it easy for our clients to visit us onsite since we’re never more than a three-hour flight from anywhere in the continental US.

Looking for a Proven US-based Manufacturing Partner?

At Pivot, we provide our clients with multiple solutions to complex NPD and supply chain challenges. With nearly fifty years of experience and an internationally award-winning portfolio of successful products that span fourteen industries and six markets, we are the US-based global partner for all your product development and distribution needs.

If you’d like to learn more about how we can help you get the best of both worlds through a balance of domestic and global sourcing solutions, contact us today for a free consultation!

Bringing Operational Efficiencies to Scale: Statistics and Top Trends in Digital Adoption

Industry 4.0 is no longer an aspiration but an unfolding reality across the manufacturing sector. Digital evolution — the industry-wide shift driving the adoption of state-of-the-art digital technologies — is rapidly underway. US manufacturers lag behind competitors in countries like Singapore and Germany in bringing smart manufacturing to scale. But spurred by massive investment in US-based manufacturing, more American production partners are beginning to catch up by implementing data-driven technologies.

At Pivot International, we are a one-source global leader in digital adoption bringing operational efficiencies to scale to deliver premium product solutions for customers worldwide. We leverage a diverse suite of digital technologies, advanced DFM expertise, and 320,000 square feet of flexible manufacturing options unmatched by other US-based competitors. With 50 years of proven experience that spans fourteen industries, we provide a smooth, seamless, highly competitive approach to product development.

Bringing Operational Efficiencies to Scale: Digital Adoption Statistics and Trends

Digital adoption is a herculean undertaking. But even investment in foundational technologies such as cloud computing yields significant rewards by delivering the computational power, visibility, and speed needed for increasing operational efficiency at scale. The following statistics and trends bear witness to accelerating rates of digital adoption.

• Half of executives report that investment in digital adoption is one of their top priorities.
• Forty-five percent of manufacturing executives say they’re making investments in industrial IoT for the express purpose of driving operational efficiencies.
• Investment in AI technologies is forecasted to achieve a compounded annual growth rate (CAGR) above 20% through 2025.
• Discrete manufacturing is among the top-three industries leading digital adoption.
• Smart factories are increasingly being viewed as critical to market leadership.
• The transformation of brownfield facilities is being accelerated with IoT, robotics, automation platforms, and AI-enabled tools to support production.
• More organizations are making headway in their facilities with connected, reliable, efficient, and predictive processes.
• Localized and limited technology projects are being successfully scaled to full production lines.
• Quality monitoring and other edge-computing applications play an increasingly common role in compliance.
• Manufacturers are optimizing performance using asset tracking sensors and connected machinery for real-time equipment monitoring and maintenance.

Examples of Digital Adoption in Action

Deployment of digital adoption drives operational efficiencies of scale through dramatically increasing insight and integration, improving processes, and creating conditions for maximum value extraction. At Pivot, examples of digital adoption include machine learning, AI, blockchain, cloud computing, preventative maintenance, digital twinning, and advanced pick-and-pack surface mount technology (P&P SMT). We’ll briefly take a look at the last three.

Predictive Maintenance

When industrial equipment malfunctions or breaks down without warning, it results in significant quality control issues or halts production altogether, resulting in skyrocketing costs for companies and customers alike. There are costs on the other side of the coin that result from routinely servicing equipment that is running perfectly with no issues in sight. Predictive maintenance drives operational efficiencies through early detection of equipment malfunction or breakdown. At Pivot, this enables us to service equipment only when necessary and deliver more secure, higher-yield production runs that meet strict compliance standards.

Digital Twinning

Digital twinning involves the creation of a virtual model (or “mirror”) of networked industrial machines that allows for remote monitoring, analysis, optimization, and control. The benefits of Pivot’s deployment of digital twinning are numerous and include:

• Scalable production runs to meet fluctuating market demand
• Optimized distribution that enables companies to flexibly shift production to locations proximate to product shipping destination
• Dissolution of silos and integration of systems
• Reduction of waste, redundancies, and sticking points
• Real-time asset tracking
• Smart warehousing
• Enhanced risk management and reduction

SMT

Pivot is an industry leader in IoT and sensor technologies and our digitally twinned, high-speed P&P SMT lines represent an extensive investment in digital adoption. P&P SMT delivers fast, flexible, and flawless production that fuels cost savings, expedites time-to-market, and increases ROI. It provides applications across multiple product categories and is the premier electronics manufacturing solution for medical, industrial, commercial, and consumer markets.

Seeking a Leader in Digital Adoption to Help You Deliver a Successful Product?

If you’re gearing up to bring a successful product to market, Pivot brings the advanced expertise you’re looking for. With proven experience behind an internationally award-winning portfolio of innovations that span six markets, we’ll work closely with your team to make your product vision a winning reality. If you’d like to learn more about how we can help you successfully scale, contact us today.

Cyber Threats Have Reached DEFCON 1 for Many Manufacturers. Here’s Why and How They Can Protect Themselves

Manufacturers already had it tough. Less than two years ago, the State of Encrypted Attacks revealed the sector was more vulnerable to malicious browser breaches than any other industry and took 38.6% of cyber attacks. With the recent conflagration of geopolitics and Western security officials issuing warnings to US companies of cyber-attacks, many manufacturers have found themselves in a DEFCON 1 threat-level situation.

To add insult to injury, manufacturers aren’t only the target of rogue cybercriminals and malicious state actors. They’re also victims of cyber attacks launched by aggrieved employees and paid-for-hire hackers involved in corporate espionage.

Understanding Manufacturing’s Vulnerability to Cyber Threats

Manufacturing’s vulnerability stems from two distinct challenges. The first is that manufacturers have traditionally focused on safety and performance, not data security. The result is that manufacturers’ facilities and IT infrastructures often lack alignment and uniform policy enforcement. Second, many manufacturers have failed to adopt the latest technologies and face technological obsolescence. (Driving home the point that digital evolution — the industry-wide effort to shift from legacy systems to advanced digital networks and applications — is more vital than ever.)

At Pivot International, we are a global manufacturer, product development, and supply chain firm with integrative operations and extensive investment in the latest digital technologies. These technologies include cloud computing, AI, blockchain, advanced P&P SMT, and more. Our one-source, full-service business model means that centralized coordination and oversight are part of our company DNA and technology stack. This enables us to achieve seamless alignment across our facilities and deliver extremely high levels of data security for our customers.

The Top Three Cyber Threats to Manufacturers

Manufacturers must defend themselves against three types of cyber threats: traditional, advanced malware, and internal. Let’s look at each.

Traditional attacks refer to unauthorized access to sensitive systems and data, often through phishing attacks. Breaches occur when company employees unwittingly disclose login credentials or other information to malicious actors, essentially giving cybercriminals the key to the company’s front door.

Advanced malware is becoming more common and increasingly disruptive. With these sorts of attacks, ubiquitous connectivity cuts both ways, allowing malicious software easy access to legacy systems from which it can spread like wildfire to others. In the worst cases, all that is left is scorched earth.

Internal threats can be no less destructive but can also be more organizationally disruptive since these attacks are made by insiders — typically those motivated by the desire to steal IP, blackmail stakeholders, or carry out a personal vendetta in response to a perceived grievance. These attacks can be executed from anywhere within the organization, from the entry-level to the C-suite.

The business impacts of any of these attacks can range from inconvenient to catastrophic. At their worst, cyber-attacks can damage a company’s competitive advantage via the proliferation of counterfeits or knock-offs that weaken its market position. Even when companies survive cyber-attacks seemingly unscathed, they can suffer potentially devastating reputational damage, especially when sensitive customer data has been compromised.

Strategies That Can Protect Manufacturers

Manufacturers can protect themselves with two different strategies. The first can be summarized as “know thy enemy.” The second involves achieving greater alignment, integration, policy measure enforcement, and aggressive moves toward digital revolution.

Data thieves and bad cyber actors tend to rely on phishing as their preferred form of attack. But first, they set the stage by wreaking havoc with your network and then swooping in to save the day by posing as a source of help. If your network seems to be acting up or crippled entirely and a pop-up message appears from Microsoft or another trusted source with an offer to fix the problem for you — contingent on you providing a credit card, login credentials, or other information — watch out!

In addition to being wary of phishing attacks, manufacturers need to understand that observing best data security practices and moving toward digital revolution is the price of entry for a secure network, which means focusing on:

• Ensuring all facilities and users are united and aligned under an integrated IT infrastructure and that security measures are uniformly enforced
• Outwitting attackers by using apps (which are invisible to attackers) to access resources and data without exposing the entire network
• Deploying cloud-native proxy-based architecture to inspect every user across all traffic to decrypt, detect, and prevent threats in all SSL traffic
• Unleashing AI-driven quarantines of suspicious activity, storing it for analysis, and halting malware installation in its tracks

Looking for a Trusted Manufacturing Partner?

With a half-century of proven experience, 320,000 square feet of scalable manufacturing capability across three continents (including three domestic options in the American Midwest), we are a trusted production partner to companies worldwide. If you’d like to learn more about our services, how we protect your data, and how we can help you launch a successful product, contact us today!