If you're interesting in learning more about this read the book "The Goal" it's presented as a novel and the main character is rather daft, however it has a lot of insight in it if you can look past that fact they everything is explained as if the main character is really slow.
The Beer Game -or- Why Apple Can’t Build iPads in the US
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Re: The Beer Game -or- Why Apple Can’t Build iPads in the US
#12Apple could afford to reopen the plants they had in Fremont, they just might not be able to produce 100% of their products there . From the NY Times article he refers to: paying American wages would add up to $65 to each iPhone’s expense. Fender does this--they offer you the choice of a Chinese, Mexican, Japanese, or American made guitar and just price accordingly. I would pay more for an iPhone that I knew was made…
I'm guessing you didn't read the piece. Wages are not the primary issue.
Re: The Beer Game -or- Why Apple Can’t Build iPads in the US
#13[deleted]
Re: The Beer Game -or- Why Apple Can’t Build iPads in the US
#14That is an interesting theory but I would guess that the real reason is their devalued currency which allows apple to save a huge percentage on production. Sure cheap labor helps, but is cheap partially due to the currency difference. Despite anecdotal stories, The US still makes up 20% of world manufacturing and retains its spot as the global leader. http://en.wikipedia.org/wiki/Economy_of_the_United_States The colo…
How is it that you accept that 'colocation theory' explains Silicon Valley, but you dismiss it as explaining Shenzhen without explaining why one is different from the other?
Re: The Beer Game -or- Why Apple Can’t Build iPads in the US
#15Apple could afford to reopen the plants they had in Fremont, they just might not be able to produce 100% of their products there . From the NY Times article he refers to: paying American wages would add up to $65 to each iPhone’s expense. Fender does this--they offer you the choice of a Chinese, Mexican, Japanese, or American made guitar and just price accordingly. I would pay more for an iPhone that I knew was made…
Speaking Fenders (and Gibsons too, naturally,) there are checks in place to ensure that the US made versions are of the highest quality.
My Les Paul was made in Canada. I do not believe that Canadians are unable to produce as high a quality guitar as US Americans, but they are, I believe, not allowed to.
The difference in cost between an American Les Paul and its equivalent US model is approximately $250-300. The difference in quality is less. The smart money, among most guitarists, is to buy the non-US version, take it to a decent luthier, and give them $75-100 to bring it up to par which, in my experience, actually leaves you with a better guitar than the Memphis version (excluding the much more expensive customs.)
Regardless, many consider the US version to be the best of the bunch, and are generally happy to pay the premium.
The major difference of course is in the fit and finish. You have to enforce a quality difference that is, effectively, arbitrary. In Apple's case, that means deliberately reducing a lesser-quality product for the non-US products, which seems contrary to their 'ship perfection' mentality.
It might work, it might not, but the key is in distinguishing between the product versions in some way. Perhaps this could be accomplished with a slightly different feature set, or maybe the 'white' iphone could be reserved for US manufacture, I dunno, but I honestly have a hard time imagining that there is a significant population of consumers willing to pay for the "Made in the USA" version, if only because the "Made in the USA" version of other products have not performed up to expectations.
Re: The Beer Game -or- Why Apple Can’t Build iPads in the US
#16Apple could afford to reopen the plants they had in Fremont, they just might not be able to produce 100% of their products there . From the NY Times article he refers to: paying American wages would add up to $65 to each iPhone’s expense. Fender does this--they offer you the choice of a Chinese, Mexican, Japanese, or American made guitar and just price accordingly. I would pay more for an iPhone that I knew was made…
...paying American wages would add up to $65 to each iPhone’s expense.
The point of the article is to illustrate that wages are not the only problem. Chaotic effects in multi-tier supply chains are also a real problem.
I would pay more for an iPhone that I knew was made in America. I'm sure I'm not the only one.
You are certainly a minority. I don't think most people value nationalism at $65.
Personally, I'd rather have the jobs go to the people who need them most, rather than to people who are superficially "like me". But while assigning a $0 value to nationalism is probably a minority view, I suspect the majority view is far closer to $0 than to $65.
Re: The Beer Game -or- Why Apple Can’t Build iPads in the US
#17Having gone through the painful exercise of building robots in the US, I appreciate the problem. Our end-end supply chain latency was 16 weeks, far too long to scale effectively to match demand. Many component changes we wanted to make would have created a 6-week delay, so we had to compromise. A place with a factory across the street that could make screws in 3 hours sounds like heaven.
Re: The Beer Game -or- Why Apple Can’t Build iPads in the US
#18I first read about the beer game in The Fifth Discipline. That was the first book on business I ever bought.
http://www.amazon.com/The-Fifth-Discipline-Practice-Organiza...
Re: The Beer Game -or- Why Apple Can’t Build iPads in the US
#19In case anyone's curious why beer was used as the product in the game, it's likely because US law requires that alcohol be distributed in (almost) this way: http://en.wikipedia.org/wiki/Three-tier_(alcohol_distributio...
For a good documentary that illustrates the system we have in place, check out:
Re: The Beer Game -or- Why Apple Can’t Build iPads in the US
#20Apple could afford to reopen the plants they had in Fremont, they just might not be able to produce 100% of their products there . From the NY Times article he refers to: paying American wages would add up to $65 to each iPhone’s expense. Fender does this--they offer you the choice of a Chinese, Mexican, Japanese, or American made guitar and just price accordingly. I would pay more for an iPhone that I knew was made…
Did you read the article? The whole point is that you can't just "reopen the plants" because those plants rely on other suppliers in a complex fast-moving supply chain; in China those suppliers are practically next door and have turnaround times measured in hours, while in CA the suppliers are miles, states, or even continents away with turnaround times measured in weeks. One hiccup in supply (say, something's wrong with a screw and it must be redesigned and a new batch produced) means a train wreck of production backup (nothing ships until that modified screw is produced, which is weeks if you're waiting for the next container ship to bring it).
He's not talking a mere matter of paying an extra $65 for "Made in USA" markings, he's talking the USA model of iPhone 5 costing ~$200 more and introduction/production being chronically behind the China version for months. "Lesseehere...I can buy this now for $X, or I can wait to buy the exact same thing (save for different markings) 6 weeks from now for $X+20%." Those Fremont factories won't be open long.
And somehow methinks Fender's supply chain isn't as fast & complex as Apple's.