Well, it finally happened. China has begun to drop the ball. Now that country is experiencing rising prices, increased wages, unions forming, raw material price increases, government intervention, and a host of other problems that have recently combined to jeopardize China’s standing in the global inustrial market. I hate to say I told you so, so I will refrain from doing that.

But, it was easy to see this coming. It’s happened many times before with countries such as Japan and Taiwan, and others. I made a dire prediction 2 years ago that this day would come and I predicted the “new” kids on the block would be Mexico and India. India is on it’s way, but Mexico has some major problems to take care of before they get their real chance.

So, who is next in line to take over the industrial and manufacturing jobs from the United States that had been going to China? Not Iraq. Not South Africa. But Bangladesh!

Bangladesh? Yep! And I bet most people couldn’t find it on a map right now. (It’s right next to India-surprise!). But they have been the heart of textile product manufacturing for years now, making clothing items for such giants as Wal-Mart and Target. They just built a new 10 story building with each floor the size of a global soccer field and each floor is packed with brand new state-of-the-art sewing machines. This adds up to very cheap labor rates. (Sound familiar?)

Of course the buyers in all the big manufacturing companies of the U.S. are seeking out those cheap wages so they can continue to make their profits. It doesn’t matter what country they go to. I believe that is a sure sign that soon there will be tooling and mold exchanges between the U.S. and Bangladesh. After all, who can make molds cheaper than sewing machine operators stuck in the back corners of some huge fort-walled complex in the forests of some backwoods country? We’ll just tell them what we want, give them the materials and designs, and maybe some moldmaking equipment, and off they’ll go. And soon we will have molds failing all over the place. But they will be cheap (I really should be saying “inexpensive”. “Cheap” sounds so…well, cheap).

I have given up trying to convince companies in the United States to take the approach of eliminating the labor costs altogether if that is really what’s making us non-competitive. It is so much easier to just blame labor and then move the jobs overseas. But it is true that we can be the most competitive country in the manufcaturing world when labor is not a consideration. So I have always said let’s redirect our thoughts to automating everything we make. And then we can train people to run and maintain that automation. The result is actually more jobs being created, at higher pay, and greatly increased productivity. That can be done so easily, even for making a small number of products by using flexible automation. But it is much easier to be robotic in our own actions instead and simply go along with the flow and the bosses orders, even when they are wrong!

But, our industrial nation has become one without a backbone; afraid to make waves and try new ideas. So, we will soon witness the day when China has become a major power country, self reliant at our expense just like Japan did. Then we will be looking for a new country to exploit for labor costs. It is going to be Bangladesh. And you can take that to the bank (if you still have one).

I welcome your views.

The other day I needed to ship a 40 pound case of liquid RousterChem (our descaler solution) to a good client of ours. I took it to a local UPS center while out on another errand and asked the clerk if they could provide a “Fragile- This Side Up” label for me. She sneered at me while saying “You can buy a book of them” and pointed to a wall rack. Then she added “But it’s a waste of money ’cause we don’t pay any attention to labels anyway.”

I was shocked at her attitude. I said, “Well ,I’ll buy a book anyhow.” She reluctantly sold it to me and I placed a label on each side of the box, then gave it to her. She registered it, gave me a receipt, and threw the box tumbling into a huge container awaiting pickup. “I said, “At least you could have handled it properly while I was still in your store.” Her response was the ever popular and meaningless “Whatever”, and she went back to reading her comic book or “whatever”.

Sure, I could report the action, which I did. Her supervisor only stated that, “It’s really hard to get good help these days.” I had to agree, and told him that seemed to be true with supervisors too.

Next time I’ll try Fedex.

Over the past few years I have noticed a very alarming trend. Most of the seat-of-the-pants experts and original firestarters of the injection molding industry are either gone or slowly going away. (No offense to those of us who are still here).

That should be expected in any industry so in itself that is not such a remarkable event. But, what really is startling is the fact that very few people are entering the business for the long haul so there aren’t many in the wings to take the place of those who are gone or are destined to leave.

Now, I’m one of the dinosaurs of our business myself and have entered semi-retirement already. I consider myself an “expert” in injection molding (as do the courts) and I am really bothered by the fact that all the knowledge I have accumulated through my 50 years of solid experience may never be used again once I leave (for whatever reason).

Yes, I’ve written a dozen or so text books on various subjects and tried to impart my wisdom into each of them. But it is hard to explain in writing a method that might be dependent on “sensing” what is going on. That sensing is something that just comes with a lot of experience. It’s like the jockey that just “knows” what his horse is waiting for him to do in order to win the race. It’s like the 6th sense the detective has that warns him that a person may not be telling the truth, or the feeling a mother might have that her child is in danger. That can only come with experience.

I suggest that any newcomer to our business today can certainly learn a lot from schools (they did not teach plastics when I was starting the business), and from attending seminars (well some of them anyway), and from reading books like mine (and some others), and from the Internet (maybe), but all of that learning would be heightened by watching an experienced person perform the actions that are needed on a daily basis, much of which is not covered in even the best of teaching materials.

Another major problem is that there are very few people even interested in getting into the injection molding business right now. It is not considered “glamorous” enough for many and the pay is nothing to write home about. (Whatever happened to apprentice programs?)

So what do I recommend? I believe we, as an industry, should be making a big effort to video tape, record audio, take notes of interviews, and anything else we can think of to capture the precious knowledge that is slowly slipping away out there right now. Also, we should be campaigning to make the business more attractive and more rewarding for those who do decide to try it out. And maybe we should be encouraging a return to shop classes and vocational schools for those students who just aren’t interested in entering college programs and ending up with business suit jobs. Many high school kids today would rather be working with their hands but can’t find a program that offers that activity. Maybe your own company would be willing to sponsor an apprectice program that would pay well enough to keep an employee interested in staying.

I’m willing to listen to any suggestion that would work to help keep our country involved with injection molding. But we can’t compete if we don’t have the right personnel. And right now the most experienced people are disappearing. Who’s going to be there to keep the industry going?

Well, here we are just shortly after our new President’s first 100 days in office. And I’m wondering what you all think about what has transpired so far and what you think might be foretold by what has happened in his first 3 months on the job.

A lot of presidential decisions have been made and actions have been taken. Some things seem to have been put on the back burner while others just sort of appeared out of nowhere. All in all a whole lot of stuff has transpired. What do you think?

I really am curious to know your thoughts but I’d like to hone in on a few specific areas. For instance, how have your business plans been affected by his first 100 days? Are you planning now to just sit back and see what happens? Or are you confident enough to go ahead and plan that expansion you were considering? Or are you so scared now that you are going to sell your business?

Also, how have your personal plans been affected by these first 100 days of action (or inaction)? Have you cancelled your vacation? Or are you going to splurge and go somewhere expensive now? Will you buying a new car? A new house? Or do you see yourself just barely able to get by with very few (or no) bright lights at the end of your tunnel?

I’m serious about this. I would really like to know your thoughts. I have my own of course but I want to wait to share them as I don’t want to influence yours. Please take a minute or 2 to reply. We’ll post your answers and then discuss everything. Thanks for listening.

Okay, I admit it. I voted for McCain. I’ll also admit that I may not have voted for him if Palin didn’t come on the ticket.  (I was considering a write-in vote, maybe for myself). But now that the smoke has cleared and the voting is done I have taken a good long look at things political and tried to decide how I am going to react to the blow that resulted when my candidates lost. My wife and I. and my 4 children, have had many discussions about the topic. Finally I came to my decision.

It probably comes as no surprise that I decided to give the new regime a chance to show what it can do. That’s only fair under the circumstances. Can you imagine what it would be like to be elected to lead our country in a time of such economic turmoil and stress? As President-Elect, would you be able to face the fact that terrorists have already announced they were going to increase activity as soon as the new President was elected? Would you be able to set your political agenda aside, if only temporarily, to sit down with your peers from both sides of the aisle and find solutions to the volume of problems now facing our country? Remember, many of these problems did not even exist when the Presidential campaigns started.

I have to say that I was disappointed in the election results. But, I must also say that I have been watching closely to see what Obama says and does in these short weeks before he actually takes office. I antcipated being able to say “See! I knew he was going to do that!” as he took us down a path of total destruction. But, it didn’t happen. Instead I have seen him try valiantly to put together a team that can actually do something about these things. I have seen him contact even his opponents in the race to gather intelligent information and advice. I have seen him go before the public and make immediate attempts to start fixing the things that are broken. And he has done this while honoring the existing President by saying “There can only be one President at a time”. And he has NOT tried to interfere or over run existing policies. I admire him for that.

I have also come to realize that Obama is a very smart person and a strong leader. As any successful person knows, you become a strong leader by listening to others and making decisions based on good intelligence. You also place smart people in strategic positions and let them have their reign. So far, he has done those things.

So, time will tell. It always does. If Obama is as intelligent as I now think he is, and if he truly has the future of America in his heart, he will do a good job as President. We have no other choice but to allow him his day, and to pull together to support what he is doing. I intend to do that. I think John McCain would expect that from me.

The following is accordong to an article from a recent issue of the SME Daily Executive.

Falling international demand hurts small, medium-sized manufacturers in China.

Forbes (10/29, Maidment) reports that “falling demand around the world for made-in-China goods is shuttering small and medium-sized companies across China’s manufacturing heartland, leading to layoffs.” The Dongguan City Association of Enterprises with Foreign Investment expects “a fifth of the 45,000 factories in the cities of Guangzhou, Dongguan and Shenzhen — the delta’s three manufacturing hubs — to go out of business before the Chinese New Year in late January 2009.” According to the article, “falling demand for toys and electrical appliances is working back up the production chain to the copper refiners, steel makers and aluminum smelters.” In addition to the slowdown in export markets, “rising raw materials and labor costs, the appreciation of the yuan and a rising product-safety bar for their products” has hurt small manufacturers in the region.”

Seems like reality is catching up with China. For those of you who are steady readers of this Blog and my Plastics Times newsletter editorials you might recall my earlier comments and warnings about this obviously eventual situation. I can only think to myself “I told you so” (because I am too much of a gentleman to say it out loud.

Although  worldwide econonmic downturns certainly played a role in the “falling demand” for Chinese goods, it is also very evident that poor quality, poorer communications, false promises, government (Chinese) subsidizing, lack of concern for public safety, and a myriad of other internal problems led to the final closing of many Chinese factories and businesses.

My biggest concern is with the United States companies that were so blind to the real facts in the first place and went ahead and sent work to the Chinese businesses in an effort to make more profit by exploiting their cheap labor. This was usually done in response to being forced to increase the bottom line but was also done because it was so much easier than trying to find innovative ways of reducing costs while keeping the work “at home”.  Although I did my best to convince them to keep the work here, I hold no grudges and do not wish them hard times or worse. But my concern is really that they must now find new avenues for improving the bottom line and I do not believe they learned a lesson from the China travesty. In fact, I see the same companies looking at India, South Africa, Iraq, and Mexico to save their bacon. And guess what? The Chinese syndrome will strike again.

The worst part of all of this is that in the years to come we will once again be asking oursleves why we are getting defective, environmentally poor, and just plain dangerous end products from all of those countries too. When will we learn that we can do so much better right here at home.

Here it is at the beginning of Summer and oil and gas prices continue to climb. Just as the Saudis announce they will increase their supplies to the world Libya says they’ll cut back. Just as Congress starts to look at the “windfall” profits of the oil companies, some self-proclaimed “expert” says we will probably see $7 a gallon gas by the end of year.

I have to tell you I do not care how much profit the oil companies make, nor do I care what Congress tries to do to get prices lower. I don’t care because I know it doesn’t matter. The oil companies are only making their ridiculous profits because we, the American people, allow them to. And Congress can only provide lip service to the problem to make it look like the Government is really trying to do something to help us poor slobs get through this fuel problem.

But, the real problem lies in the fact the our illustrious leaders in Washington have CAUSED the fuel problems the same way they CAUSED the loss of manufacturing jobs and facilities in the United States, especially in the plastics industry. They regulated them to death.

In both cases, the federal Government created laws and taxes and fees, and paperwork, and penalties, and excessive rules, and ridiculous environmental requirements, and applied them to manufacturing companies of all kinds until those companies could no longer compete in the worldwide marketplace. Other countries (like China) who had very little regulation of such industries, began to thrive economically as our very own companies were forced to look elsewhere to obtain what they needed to survive. As for fuel, that same Government established a variety of rules and laws banning drilling operations and any thoughts of creating new nuclear facilities. Instead they put all of our hard earned money (through taxes) into developing ethanol. Of course we all know the disastrous results of that fiasco. Even California eventually felt obligated to ban the use of ethanol vehicles when it saw what was happening to the feedstocks of our nation.

I mentioned above that the American people allowed the oil companies to make their ridiculous profits. My reasoning is that we, as voters and concerned citizens, have done nothing to stop them from making those profits. I believe in the American Way - make as much money as you can as long as it’s legal and ethical. So I don’t look to take their profits away. Instead, I suggest we hound our Congressmen until they remove (or greatly minimize) all the roadblocks that are now in place for any oil company (even the wildcatters) to drill wells and start producing more oil. When that happens you will see smaller companies start to take risks and begin supplying gas again like they did in the old days. You’ll see small, independent companies selling gas at small, independent stations. And if we all start buying from those stations you will see an immediate, drastic drop in gas prices at the “big boy” stations in order to stay competitive.

Yes, maybe some of my solution is stated with tongue-in-cheek. On the other hand, maybe not. What are your solutions?

Here we go again! Now it’s polycarbonate bottles that are being banned. First in Canada, then in California (isn’t it usually the other way around?).  And, again, the ban is declared way before the facts are all in. There is NO proof that PC bottles contain anything that can cause problems in the future lives of babies. But, that is the claim. What problems? Well, we’re not sure. When will they occur? Well, we’re not sure. What will cause the problems? Well, we’re not sure.

And, the biggest question I have, (after “Why are we doing this in the first place?”) is “what will we use for replacements”? Will we go back to glass and create huge problems with waste disposal, breakage and increased costs? Or maybe aluminum? Of course not! The environmental activist response would be immense. Clay? Too dangerous from a health standpoint due to bacterial growth. Tin cans? Haven’t you heard of tin poisining? Wood? Hmmm…. can anyone say “rain forest depletion”?

Okay, I give up. What will we use to replace the plastic bottles? Speaking for a nation that is so concerned about political correctness, and thus slowly losing our ability to use common sense to address issues, I can’t think of a thing. I guess I’ll have to join the other hand-wringers moaners and go to my dark corner to fret about this absolute crisis for a while. How about you?

A story in the September24, 2007 issue of Plastics News found me with my mouth hanging open and my mind reeling at the finish of the article. The story related the efforts by China, to lure United States medical product manufacturing firms to their country and many of the largest firms (such as Interplex Industries and GW Plastics, among others) are actually involved in doing so at this very moment!

This is incredible! Aren’t you medical guys reading the headlines? How can you consider such a thing after all the problems we have had with toys, pet food products, automotive tires, batteries of all types, human food products, clothing, etc., etc., etc. coming from China? Now you’re considering them for making our medical products? I can see the lawyers lining up now.

This is just another example of how we are putting profits ahead of quality and safety. The company bean counters are pointing to short-term savings by utilizing cheap labor and molding in countries with lower (or no) regulatory standards compared to the United States.  They seem to forget that those standards are in place to help protect our citizens from defective products. So they conveniently look the other way when quality and safety issues are involved and expect China to just pick up the ball and do the right thing. Now we are finding that they can’t, won’t, or don’t know how.

Maybe when the news media start broadcasting alerts that China-produced medical products are responsible for the deaths of hundreds of US citizens we will take a closer look at why we are molding them in China in the first place. And maybe then we will put greed in the back seat for a while and start finding ways of being smart and competitive ourselves so we can keep all these products at home in the United States where they belong.

And for you medical firms? Here come the lawyers!

Now, what do you think?

As you may have heard or read, GE Plastics has been acquired by SABIC, a Saudi Arabian plastics group, for a reported 11.6 billion dollars (US). This takes effect in late 2007.

Just for reference sake, in the recent past SABIC purchased or otherwise acquired 2 other major players in the plastics material arena, the European firm, DSM Petrochemicals and the UK firm, Huntsman Petrochemicals.

The acquisition of GE Plastics will bring SABIC’s total employee count, after “reorganization”, to just under 30,000 people.

So, what does all of this mean? 

In my always most humble opinion, this just points out the end of a very historic era that belongs in the history books about the United States influence on technology and manufacturing worldwide. It demonstrates the lack of backbone that many of our home-grown companies have, and the drive for more profit, and less concern for integrity and national patriotism. It is far easier to sell out than to fix the problems.

While those words may seem a little harsh, just look around your own arenas and see what you can find. In a very few cases a company will look at offshore competition and decide to fight it by making much-needed changes in their own operation. They strive to become the competition rather than cower to it. The most successful organizations I know of are in a constant struggle to balance personnel utilization, equipment upgrades, facility alterations, etc., etc., to ensure that they are fit and able to provide what their customers want while making a reasonable profit in doing so. On the other hand, a vast majority of companies now seem too willing to just throw in the towel, plead for government assistance, or sell out to an offshore group of investors. I believe that is a sign of insecurity, a lack of initiative, a demonstration of poor judgment, and a show of personal greed. GE is a good example of this. In the past few years especially, GE Plastics has been non-responsive to its customers desires and/or needs, shown no initiative in solving their internal financial problems, and balked at making personnel changes (especially in sales) that could have turned their operation around. Now they are gone.

Sure SABIC has a small Houston-based facility that allows them to be known as having an American arm to their organization. And, I’m not bashing SABIC. They are just making a good investment decision. But this acquisition of GE Plastics is seen by many as one of the last nails in the coffin for our U.S. based plastics industry. It looks like it will be spread out among China, the Arab states, South Africa, and possibly India. I believe Russia may also have a hand in it before too long.

I can only look at this and say, “The end of a wonderful era has begun”. Now, what do you think?