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I recently returned from China after spending a week meeting with our Far East team as well as visiting multiple factories in our portfolio. Several of these factories I've been to many times over the last fifteen years and it is always interesting to see how they change over time. With some it's hardly at all, while others undergo constant transformation. By having the benefit of a long term relationship with the contract manufacturers, it’s incredibly useful to see how they innovate.

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Here are my observations:

  • Due to the rising labor cost, there is a significant drive to automate to reduce the number of workers (or, said another way, make the tasks that the workers do much more efficient).
  • One factory had replaced the ubiquitous conveyor belt with a form of linear cell line where the workers would pass the parts to each other by hand. The idea was that there was wasted motion putting and picking the components off of the line.
  • Tooling has not changed. It’s still a mix of conventional CNC + EDM.
  • Factories are adding serial numbers to the SMT reels for traceability. You can imagine what would happen if the wrong reel was placed in the machine and a PCBA was built with incorrect components.
  • Manufacturing continues to be relationship-based, which is strengthened by time. Even if it was possible to find a good CM through the common online search tools, it would be very difficult to get the attention of the best suited factories without a warm intro.

Interesting to note that my last trip to China was less than a year ago, so shifts in innovation move fast. I'm looking forward to my next trip to see what other changes occur.


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