Chinese Tools - A Different Take (long)

[route246]

This is a static viewpoint and I understand it. However, the long view would be that at some point you may not have a choice. Major appliances are probably the next thing to move totally offshore. Korean and Chinese manufacturers are making substantial inroads because reviews and opinions don't lie. It's only a matter of time. If you make something better and cheaper, early adopters will buy your goods. As these early adopters start reviewing your products the vast majority will follow. Only the laggards will be left at that point. It happened with TVs and consumer electronics. It will eventually happen with tools.

For things like LG refrigerators or Haier air conditioners (re-branded with American monikers) start becoming mainstream as they are now the competitive nature of the industry will leave the domestic producers at a huge cost disadvantage.

Sometimes it isn't that simple. I wouldn't own a Toyota if they paid me to. Why? Because even their super-duper Tundra would be reduced to scrap in a matter of minutes the way I use a truck. I wouldn't care if China came up with a silky smooth 200 tooth ratchet either. I'm less concerned with tooth count than I am with "what kind of pain can I expect to be in when this breaks?". I doubt that there's going to be someone from China show up in the parking lot with a replacement for that ratchet when I blow it out either (much less hook me up with really good free stuff like Mac and Snapon have over the years).

Chinese tools and Toyotas are fine for some of the population, but they aren't responsive to the needs of everyone. People need to buy what works for them, and leave the other guy the hell alone. The majority doesn't dictate the needs of the whole. I will never suggest that the typical homeowner/weekend warrior needs Snapon or even Bluepoint tools. It's pointless and wasteful to spend that kind of money on tools that will mostly gather dust. Conversely, it's pointless and stupid to suggest that someone who makes their living with their tools trust their safety and sanity to something that's of dubious quality.

 

[route246]

Actually, healthcare is very easy to outsource. You can't perform surgery very easily but you can use lower level medical professionals (nurse practitioners, RN, LVN, physician's assistants, etc.) to be the eyes and ears of remote physicians.

I had a very sore knee and called my local medical group. They told me I could see a licensed PA that day or wait a week to see the orthopedic physician. I asked what a PA was and they explained it. I said, sure, if I could get a preliminary diagnosis and some relief, let's go for it. Basically, she seemed competent and experienced and did some basic diagnostic work and ordered an x-ray. She read the x-ray, transmitted it electronically to another location (I have no clue where the doctor was but it's a big medical group) and he recommended a brace to keep pressure off a ligament. I walked out of there with a brace and my knee was fine a week later.

The PA was the eyes and ears in this case and she did a competent job. She told me if there was a severe tear or something really serious that I would be redirected to a bigger clinic in their group for possible surgery prep but that probably wasn't necessary.

Anyway, that doctor could have been in India for all I know. The bill I received had his name on it even though I never met with him face-to-face. It turns out he was at a clinic 40 miles away.

Guys,

Besides my actual person, nothing I own is made in the USA. Manufacturing is pretty much dead. Service industries, trades, Healthcare, Teaching..... that's what kids should study these days.....

I have a friend who's a PhD in Computer science... he's telling his smart nerdy kids not to go into the field..... Engineering can be outsourced pretty good, and India's universities are catching up.

It's hard to outsource your healthcare to India, or have your oil change done in Asia. or your furnace or AC fixed online.


P

 

[Zeke]

........................................

My point is, the cost for HF to step up the raw material quality of a wrench or ratchet is a very minuscule percentage of the cost of the goods. The principal cost is in the distribution and labor.

I wonder why the same thing a Sears is so much higher in price. Well, it's because it's become more labor intensive to sell it in a big store and having to introduce the item to yet another layer of distribution. If you're gonna buy Chinese, just buy it where it's cheapest.

.................................................

Lastly, if you want a glimpse at the offshore (Chinese) wholesale distribution infrastructure, check out alibaba. The link I provided does a generic search for "ratchet" in tools. Have fun traversing this site. It's the largest wholesale distributor site in China. Also, notice that it's all composed in perfect English. You can find almost anything made offshore (Japan, Korea, Taiwan, India, etc.) there.

Alibaba is not a distribution system as much as it is a manufacturer's rep company. Chinese manufacturers pay a fee to be represented by the Alibaba brokerage and Alibaba takes a mark up on goods sold. I think they leave the shipping up to the buyer and seller.

 

[midcitysaint]

I'm not an economist but I play one on TV (that's a joke for all you folks north of the Mason-Dixon)

If you want to keep consumer manufacturing in the U.S. the easiest thing to do is to devalue your currency. Yep, the Chinese do so regularly. But if the U.S. devalues currency what happens? The good is that manufacturing returns to the U.S. more consumer goods will be American made (think 1950's). We will likely have a robust middle class, etc. The bad is that globally our purchasing power will be diminished, gas prices and the prices of imported anything will soar and research and development will likely languish (compared to now).

The U.S. has a healthy manufacturing infrastructure, but we do not compete in producing high volume, low margin consumer goods (translate: anything you'd find in Walmart). This is not necassarily a bad thing since we can focus on knowledge worker jobs which (despite what an Intel CEO may have said) is the American bread and butter (aside from actual food production). Everything on your computer may be foreign produced, but guess where these products get designed? Guess who runs the business applications that makes them useful? Guess where most of the software you use on that machine is produced? You get my point...we outsource a lot of rubber stamp type of work and keep a lot of the skilled tradesman work "in country" out of a basic economic necessity to control quality if nothing else.

China can compete like nobody else when it comes to low margin, high volume production. Why? Because their government will fund construction of gigantic manufacturing facilities that will sit empty for 10 years until it's needed. Then they'll go out to some village, tell 150 farmers that they are now tool and die makers, throw them into the back of a truck and do a massive workforce reallocation. Capitalism cannot keep the pace of communism when it comes to cheap labor. We never have, we never will. But we can out innovate, we can be paradigm shifters, make better products, etc.

I try to buy American tools but not because I really think it's keeping Americans at work (even though it might in some small sense) but I buy American tools because I have the general sense that overall, they are slightly better made.

That said Taiwan has and continues to impress me with the quality of what they are putting out. China...sometimes yes, most of the time, not so much.

 

[route246]

Actually, it's much more than a rep. They also provide the critical glue which is the escrow service. They stand behind the goods being delivered. If they didn't provide this service all commerce would cease.

I wonder why the same thing a Sears is so much higher in price. Well, it's because it's become more labor intensive to sell it in a big store and having to introduce the item to yet another layer of distribution. If you're gonna buy Chinese, just buy it where it's cheapest.

.................................................
Alibaba is not a distribution system as much as it is a manufacturer's rep company. Chinese manufacturers pay a fee to be represented by the Alibaba brokerage and Alibaba takes a mark up on goods sold. I think they leave the shipping up to the buyer and seller.

 

[route246]

Your comment about devaluing the currency doesn't make sense. The dollar has devalued against most world currencies that are not artificially pegged to it at record levels now. Y80 is not exactly what I would consider a strong dollar. Ditto, even against a devalued euro.

I'm not an economist but I play one on TV (that's a joke for all you folks north of the Mason-Dixon)

If you want to keep consumer manufacturing in the U.S. the easiest thing to do is to devalue your currency. Yep, the Chinese do so regularly. But if the U.S. devalues currency what happens? The good is that manufacturing returns to the U.S. more consumer goods will be American made (think 1950's). We will likely have a robust middle class, etc. The bad is that globally our purchasing power will be diminished, gas prices and the prices of imported anything will soar and research and development will likely languish (compared to now).

The U.S. has a healthy manufacturing infrastructure, but we do not compete in producing high volume, low margin consumer goods (translate: anything you'd find in Walmart). This is not necassarily a bad thing since we can focus on knowledge worker jobs which (despite what an Intel CEO may have said) is the American bread and butter (aside from actual food production). Everything on your computer may be foreign produced, but guess where these products get designed? Guess who runs the business applications that makes them useful? Guess where most of the software you use on that machine is produced? You get my point...we outsource a lot of rubber stamp type of work and keep a lot of the skilled tradesman work "in country" out of a basic economic necessity to control quality if nothing else.

China can compete like nobody else when it comes to low margin, high volume production. Why? Because their government will fund construction of gigantic manufacturing facilities that will sit empty for 10 years until it's needed. Then they'll go out to some village, tell 150 farmers that they are now tool and die makers, throw them into the back of a truck and do a massive workforce reallocation. Capitalism cannot keep the pace of communism when it comes to cheap labor. We never have, we never will. But we can out innovate, we can be paradigm shifters, make better products, etc.

I try to buy American tools but not because I really think it's keeping Americans at work (even though it might in some small sense) but I buy American tools because I have the general sense that overall, they are slightly better made.

That said Taiwan has and continues to impress me with the quality of what they are putting out. China...sometimes yes, most of the time, not so much.

 

[back2class]

A former very high up at a very large tool company we all own tools from. A personal friend I know well (think three letter job title) told me that the stuff they switched (we were talking wrenches at the time) to overseas were speced to a higher quality and cost them less tha the USA line. So this is happening. We see it in the better Tiawaese like the duralast line and Blackhawk. Much of it is better than the danaher hard line usa craftsman sells. In fact most of the high quality Craftsman stuff is so good simply because it is rebadged from the one or two producers of that product and they simply make only ONE quality level. Most of the stuff made for sears and only sears is complete trash.

 

[midcitysaint]

Your comment about devaluing the currency doesn't make sense. The dollar has devalued against most world currencies that are not artificially pegged to it at record levels now. Y80 is not exactly what I would consider a strong dollar. Ditto, even against a devalued euro.

The dollar is still strong comparatively speaking. Look...weaker currencies cut down on the cost of a local labor force, this brings international production within that nation's border to produce goods for exportation...this can be accomplished because the exchange rate is favorable for export. China routinely devalues their currency on purpose. The tradeoff is that the devalued currency then has less purchase power for foreign produced goods...this is an unfavorable exhange rate for imports. Does that make sense?

Let's take your Euro example. European production is insanely expensive compared to the East. Much of this has to do with the strength of the Euro, which works against production for export. The UK has noted this and has quickly attempted to become an international competency center in finance and technology (especially banking services). What this means is that the UK has seen the horizon on manufacturing and blue collar work competing against the East, and even though in many respects they are still strong, the trend is towards knowledge workers.

 

[SpiderGearsMan]

LFA beats ZR1: http://www.youtube.com/watch?feature=player_embedded&v=ZibVbzXSxY0



Skip forward to 10:04 on the video to see the results.

ahhh, no
the Z06 beats the lexus

 

[catfish]

If you dont think the Chinese can make a Snap on quality tool than get out a ball peen hammer and hit yourself in the head with it because you are a *****. They can put a man in space, build sky scrapers, they have harnessed the atom (thats a nuke for the buckeyes amongst us ) and have mastered stealth technology.

So China is good at stealing technology from other nations , tell us something we don't know.Tools from China will never be top quality because of the lax copyright laws there , If they can make $5 rolex ripoffs nothing is stopping them making ripoff truck tool brands and passing them off as the real deal.

 

[nate379]

Yeah but you can't flirt with the hotties at the coffee stand if you make it in your kitchen.

I've studied Starbucks carefully. The cost of the coffee is literally pennies while the price of a cup of some crapacino latte whip can be $5. I make the same expresso at home (10 shots) for exactly $0.26 using french roast from Costco and a stove-top expresso maker from Ikea. I weighed out the ingredients and figured it out that 5 shots costs about $0.13. I'm guessing Starbucks gets it for much cheaper than I can at Costco.

 

[countrytech]

Yeah but you can't flirt with the hotties at the coffee stand if you make it in your kitchen.

unless you are married to one

 

[countrytech]

Most manufacturers utilize the highly educated U.S. labor force to produce things like chemicals, machine tools, planes, computer components or health care products. (Or missiles - ). Not low-profit things that land on consumer shelves. And U.S. manufacturing is actually really healthy - it outproduces China by 40% and accounts for almost 20% of global manufacturing. Jobs have decreased, but productivity has increased. That is because U.S. manufacturers use better automation technology to decrease labor costs. AND most manufacturing (like 60% or so) in China is owned by foreign capital (again, mostly U.S. firms). So a lot of the money flows back to the U.S. anyways.

If not, it is U.S. marketing firms or retail firms that are making the bulk of profit off of overseas manufacturing. Think about this - who is making the bulk of the profit on a Pittsburgh Socket Set, HF or the Chinese factory? It is HF, a U.S. company, that is making most of the money. And, there were U.S. dockworkers, U.S. truck drivers, and U.S. retail workers all employed in moving that socket set to the customer.

Think about it - if you need low-skilled labor, you go where it is cheap: China, India, Indonesia. If you need highly trained labor, you go where it is readily available: The U.S., Germany. You don't go to the U.S. and pay more for low-skilled labor when it is readily available in China. Asking companies to relocate manufacturing to the U.S. just to create jobs in a location where they are not maximizing profit just doesn't make sense.

And think about it this way: the current tool market is a perfect buyer's market. If you want to spend $10 dollars on a set of wrenches , you can. If you want to spend $100 dollars, you can. If you want to spend $600, you can. You, the buyer, can decide what a set of wrenches is worth - to YOU. And then you can go and purchase a set of wrenches at whatever price point you desire. Imported Asian tools are the great for consumers because they let consumers decide how much they want to spend on tools.

http://www.msnbc.msn.com/id/4134965...pite-chinas-might-us-factories-maintain-edge/

+1

This is close to my take as well. Sure, I'd prefer USA made stuff, but really, it's Americans that are profiting from the sale, transportation and design of these products, all we are losing is the production, and since production can be done so cheaply elsewhere, why waste our own resources and beat ourselves up trying to save those last couple pennies out of the product. If buying a non-American tool that still works fine for me saves me money to spend elsewhere in the American economy, and maybe even use that tool to produce something of value for myself, doesn't America win out in the end?

So China works their tails off and uses up their resources to produce stuff we trade with them for deflating paper dollar bills - who's really the sucker?

 

[GoBlue]

True premium brands from that era were Lincoln, Chrysler's Imperial lineup, Bentley, and Rolls Royce.

Ill take your stupid comments in stride considering your user name...as a profesional wrench i can honestly count on one had the techs i have worked for or with that shared your views...ZERO...

 

[VWandDodge]

Ill take your stupid comments in stride considering your user name...as a profesional wrench and shop owner i can honestly count on one had the techs i have worked for or with that shared your views...ZERO...

Yeah, GM has such an illustrious history regarding quality

 

[GoBlue]

And Lincoln and Chrysler do? For God sakes LINCOLN AND CHRYSLER MAN!!!

P.S...sorry for calling your opinion stupid...it was a low class move...just had a long day at work fixing broken cars.

 

[omr]

cadillac was known for luxury and quality for alot of years any one denying that hasnt looked into the history of the brand .

 

[archirelic]

+1

This is close to my take as well. Sure, I'd prefer USA made stuff, but really, it's Americans that are profiting from the sale, transportation and design of these products, all we are losing is the production, and since production can be done so cheaply elsewhere, why waste our own resources and beat ourselves up trying to save those last couple pennies out of the product. If buying a non-American tool that still works fine for me saves me money to spend elsewhere in the American economy, and maybe even use that tool to produce something of value for myself, doesn't America win out in the end?

So China works their tails off and uses up their resources to produce stuff we trade with them for deflating paper dollar bills - who's really the sucker?

but the fact is that China is not using up their own resources...they've been buying our scrap steel, buying our copper, and basically other country's resources to then turn around and fabricate/manufacture goods to sell right back to us. Look up on it, it's been going on for years now...China buying up reserves of raw materials from many, many nations.

 

[omr]

but the fact is that China is not using up their own resources...they've been buying our scrap steel, buying our copper, and basically other country's resources to then turn around and fabricate/manufacture goods to sell right back to us. Look up on it, it's been going on for years now...China buying up reserves of raw materials from many, many nations.

yup i heard the same thing didnt know the facts though

 

[babzog]

I saw that too, and thought gee why don't they just get the Government to make it illegal to own any car over 5 years old. That would certainly spur car sales.

My "goto" mechanic was telling me a while ago, when I asked him where he got all his used Honda engines (he does a lot of swaps), that they come from Japan. He said there's a policy there that cars cannot be older than such and such. The old ones are broken down and scrapped. The good parts (engines, etc) are sold off.

 

[GoBlue]

that makes my b.s meter peg

 

[farmmech86]

Getting way off topic, but it isn't totally true that cars in Japan can't be older than such and such, but it is very hard to keep one that is older within the "sha-ken" inspection requirements. So it is true most people export or scrap them rather than maintain them. Wikipedia is kind of a crappy source, but you get the idea.

http://en.wikipedia.org/wiki/Motor-vehicle_inspection_(Japan)#Requirements_for_tests

 

[91bronc300]

And Lincoln and Chrysler do? For God sakes LINCOLN AND CHRYSLER MAN!!!

LOL. Too funny.

 

[route246]

I'm quite familiar with this system. It is a scam where a very expensive test/certification is required in order to register a car after a number of years. It's just like state smog tests here in the US except these tests/certifications can cost the equivalent of thousands of dollars. A total scam, mind you. I am positive it was perpetrated by Toyota, Nissan, Honda, Mazda and Mitsubishi to guarantee people trading up cars every three years. It worked for decades and kept the domestic car market there going pretty strong, even though in general, the Japanese don't drive very much and their cars usually have very low odometer readings compared to cars in the US.

But, with the down economy, instead of getting a "$2000 discount" on a new car, people have opted to pay the "$2000" and have their car recertified. I have many friends in Japan now who are driving relatively old cars. During the Bubble (80's) you rarely saw a 4-year old car on the road in Japan. That's not the case anymore.

Getting way off topic, but it isn't totally true that cars in Japan can't be older than such and such, but it is very hard to keep one that is older within the "sha-ken" inspection requirements. So it is true most people export or scrap them rather than maintain them. Wikipedia is kind of a crappy source, but you get the idea.

http://en.wikipedia.org/wiki/Motor-vehicle_inspection_(Japan)#Requirements_for_tests