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March 1, 1997

4 Min Read
U.S. moldmakers can compete globally

Robert W. Shaw, president of Shaw Intercontinental Corp., wants to set the record straight on the perception that domestic moldmakers cannot compete with their Asian counterparts in terms of price and quality. "This kind of thinking is pervasive," he says, "but it is also dead wrong."

IMM asked Shaw to comment on this controversy because his company, a global design and engineering firm, sources molders and moldmakers (in the U.S. and overseas) for a wide variety of industries, including consumer, medical, industrial, and sporting goods concerns. Customers come to Shaw for services including product design, mold filling and structural analysis, molds, and molded parts. His working milieu gives Shaw a clear comparison of Asian and U.S. toolmakers.

"So far this year, I've worked on several projects totaling roughly half a million dollars where tooling has been sourced domestically because of superior delivery schedule and pricing," he reports. "In addition, we gained the advantage of geographic closeness, allowing us to interact more readily with the toolmaker."

Clients often give Shaw specific criteria for a tool, including the type of steel, special features, water line patterns, slides, and so forth, so that all parties quote against the same benchmark for the tool. Not all decisions are based on cost, he adds. "More complicated tools can't be forced because of pricing, because at the end of the day, what matters is productivity, not how much money was saved on the mold."

What are the hallmarks of competitive U.S. toolmakers? "Those who are contenders have a can-do attitude, for one," notes Shaw. "They are also getting automated, with CAM packages and CNC machining as the cornerstones of their operations. U.S. moldmakers also compete successfully for tools that are less intricate and in which tolerances aren't supercritical."

Team approach is another key. Shaw likes to interact with toolmakers, along with clients, to get everyone's input before anyone cuts steel. In this manner, troubleshooting is performed upfront, before small problems become production glitches.

His best advice to moldmakers: "Know what market you're in, what your strengths and weaknesses are as far as the type of tool you're willing to make." Asian and European moldmakers don't go after every job. Rather than attacking them all, Shaw suggests targeting where your expertise is, and then targeting resources you need to capitalize on that expertise.

"Bottlecap molds and automotive interior panel molds are two vastly different products, for example, requiring vastly different equipment and experience," he says. "In our business, we have opportunity to work with all of these resources and learn who is better at what. Several of our projects are split up so that each part is placed where the expertise lies."

What is Shaw looking for when he goes to source toolmakers? "I go to trade shows to learn capabilities. I check to see how we can work together, and how well we communicate personally. Are they innovative and aggressive? Does their word on delivery count? These are important questions, because our reputation is based on meeting the customer's needs."

If moldmakers find that competition from Asia is stifling, Shaw advises them to reassess their niches. "It could be that you have some very stiff competition overseas in the area you've been targeting. If that is the case, it's time to either invest in equipment and technology that will make you more competitive or apply your current resources to a different area of expertise."

Admittedly, the playing field between the U.S. and Asia is not exactly level. "There are government programs in Asia that give moldmakers there somewhat of an unfair advantage by supplying them with technology, equipment, and interest-free loans. People in the Far East recognize that this is a national business they want to develop, and the government is willing to help. Unfortunately, that's not the case here in the U.S." However, this edge can be offset at times by the cost penalty involved in bringing tools here from overseas. Duties and air freight add roughly 10 percent to the cost of tools being flown in from the Asia-Pacific region, according to Shaw.

Shaw's company attempts to work with domestic toolmakers as much as possible. "In return, we not only support the economy, we're getting our customers the best possible products at the best price, which makes great business sense." He also finds that working with toolmakers here has helped him build a network of resources, so that when he needs their expertise on specific projects, he has it.

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