November 2024 Volume 6

OPERATIONS & MANAGEMENT

The reshoring session at the 2024 FIA Fall Meeting and Marketing Seminar confirmed that forging customers place a high priority on price, delivery and quality but that customer service and relationships also still count. During my Thursday, Oct. 17 session, “Reshoring is Surging – How Your Company Can Benefit,” we completed four polls that give national insight into import competition, behavior of customers and perceptions of FIA members. Poll Results THIS POLL WILL STILL BE RELEVANT AFTER ELECTION DAY Insights Into Reshoring Forgings By Harry Moser

86 member company individuals, representing 53 companies, attended the session. Titles ranged from engineer to CEO, centered around VP Sales or Marketing Manager and included 13 member CEOs or Presidents. Some companies had multiple attendees. Depending on the difficulty and applicability of the poll question, 20 to 59 responded. See Figure 1a & 1b. Results of Oct. 17, 2024 Poll at FIA Marketing Seminar Poll Question Answer # of positive responses

Principal reason you won orders vs. imports

Price

0 0

Tooling Cost

Delivery Quality

19

16 Customer Support 14 Relationship 8 Other: Buy America program 2

On what % of your quotes in the last 2 years were imports also competing?

100%

1 2 7 7 8 1 0 0

In cases involving imports, how did the buyer compare bids?

FOB price Landed cost

2

80 to 99% 60 to 79% 40 to 59% 20 to 39% 10 to 19%

16

TCO Other

2 0

Figure 1b

Imports Routinely Competing One or more imports competed in the majority, about 53%, of quotes in which members participated. That means it is difficult to consis tently avoid imports. Instead, members must adapt their sales and marketing to compete successfully with imports. Reasons Orders Lost to Imports Price was the principal reason for orders being lost to imports for 96% of respondents. The price of tooling was the reason for the other 4%. Across a broad range of products, the Chinese FOB price averages about 70% of the U.S. price. That is a big enough difference to attract the attention of most buyers. The best way to compete with China and other low wage countries is to convince the buyer to decide based on the Total Cost of Ownership (TCO), rather than the price. The TCO Estimator, free online on our website, quantifies 29 costs and

1 to 9%

0%

Principal reason you lost orders to imports?

Price

27

Tooling cost

1 0

Delivery Quality

0 Customer Support 0 Relationship 0 Other 0

Figure 1a

FIA MAGAZINE | NOVEMBER 2024 37