utsourcing. It’s a word guaranteed to evoke a strong response from virtually anyone who hears it. Yet regardless of your views, the effect that outsourcing has had on the world of manufacturing is profound.
“I think you always have to look in the global market to see what’s there quality-wise and price-wise to stay competitive,” says Harold Rogers, vice president of sales and marketing at Coverstar Inc. in Lindon, Utah. “We prefer to use American-made materials, but sometimes we aren’t able to.”
When it comes to something as large as a pool cover, it’s difficult to imagine that manufacturers could ever ship the assembled piece from a low-cost nation such as China or Mexico. It’s cost-prohibitive, and as a safety product, production quality should be a No. 1 concern.
However, while the United States retains a stronghold on the assembly of covers, component parts are imported from around the world. “We bring in our cover fabric from Germany,” Rogers says. “It actually costs us a lot more, especially since the Euro is going up. But we feel it has better quality.”
Indeed, the importing of foreign products is changing the manufacturing industry. There are some parts of the country where it’s more cost-effective to manufacture in the United States, and other areas where it makes sense to outsource.
“A lot of people look down on outsourcing and say that you’re not supporting America,” says Tom Dankel, vice president of AquaMatic in Gilroy, Calif. “But if you go out of business because you can’t compete, you end up laying off hard-working people in the United States.”
Unwitting involvement
In some cases, outsourcing may be indirect and unintentional. “We assemble all of our covers in the United States, [but] we may purchase buckles from a manufacturer, for example, and it may well be that those components are manufactured offshore,” says Sue Sousa, national sales manager at Sunstar Spa Covers & Accessories Inc. in San Marcos, Calif. “We would have no way of knowing that for sure.”
That doesn’t mean cover manufacturers can’t reduce costs by purchasing component pieces or even injected-molded parts directly from foreign companies. It’s a trend that everyone seems to acknowledge will eventually happen, if it hasn’t already. Yet few are willing to talk candidly about it.
“I do know it’s becoming more prevalent now that it was five years ago,” says Paul Autry, general manager of Poolsaver by Sun Systems Inc. in Brea, Calif. “Our production and assembly is here in the United States. But component parts, the nuts, bolts and some bracketry, those are all probably coming from abroad.”
That’s why Autry’s company emphasizes customer and dealer service. “That gives us the competitive edge so that our customers and dealers stay happy,” he explains.
Some manufacturers aren’t so convinced. “The quality control and final packaging are done in our factory, but we bring in raw parts from all over,” says one cover manufacturer, who prefers to remain anonymous. “On one of our products, the metal is being fabricated in China, the gas shocks are from Mexico and the rubber sleeves are made in Illinois.
“For a price increase of approximately 50 to 100 percent, we could produce every part of the product in the United States, [but] the customer will still buy the cheaper product,” adds the manufacturer. “It bothers them that the product isn’t U.S.-made up until the time they have to pay for it.”
Afraid of backlash
This is the bottom-line concern. Many manufacturers fear a backlash from dealers who might be upset that they use foreign-made components. In reality, they would be surprised.
“I can’t fault a manufacturer because they’re outsourcing,” says Lou Downes, president of Downes Swimming Pool Co. in Arlington Heights, Ill. “Everybody’s outsourcing. It’s what’s happening.
“What matters is the quality. When bean counters go to work, they tend to substitute with products that aren’t that high quality. I would only be concerned if that became an issue. Otherwise, it’s inevitable,” he adds.
Downes is not alone. Most installers feel strongly that products “Made in the U.S.A.” are preferred. But they also understand that in today’s economy, it’s unlikely.
Manufacturers tend to agree. “Eventually, I think outsourcing will be inevitable,” says AquaMatic’s Dankel. “Asia is hungry. They’re becoming more industrialized, open and profitable.
“As a company, we are forced to be competitive,” he adds. “We have 50 employees, and we have a responsibility to them and their families.”
