Every few months or so sees another European or USA-based bike brand or component manufacturer make a move east on some scale or another. This often means setting up an office and maybe a warehouse, or finishing facility, in Taiwan. Mass manufacturing processes will probably be located across the Taiwan strait, although there is still plenty of primary activity happening in Taiwan.
At the same time there are also relocations back to Taiwan on the part of some companies as costs rise and skilled labor becomes harder to find.
In a recent post I covered how sourcing a supplier or joint-venture partner is not all that difficult. Well, on the surface it looks easy. But there is a lot to it. Success depends on many factors and there is certainly no formula that you could apply, not to mention what you might think success actually to be.
I recently noticed that an independent frame-maker has moved back to their core business after what looks like an ODM collaboration with a Taiwan-based producer. Without knowing the details of what happened I see in this sort of event a story of adding value.
Individual attention to each frame to the extent that each frame is completely made by the one (crafts)person enables a frame builder with a degree of reputation or exposure to command high prices for the frames constructed. If you can classify your design as “hand” built, then, for the market, a premium is justified in a low volume high added value business model.
I was intrigued by the sales pitch of a very prestigious USA-based manufacturer who was displaying for the first time at this year’s Taipei Cycle. Located on the newly opened upper floors of the Exhibition Center (demand sees booths even located on the pavement outside this year) the marketing angle was “hand” built.
When boiled down it seemed that “hand” built meant that the welding was performed by hand, and not by machine. Tubes were welded together with the TLC of a real human being “unlike what goes on in Taiwan factories” said the guy.
No point in debating a commonly held view. It’s just that a lot of production is carried out in small workshops that dont have the capacity to process large volumes. Each frame passes through several sets of hands. But each is welded by hand and by someone who is absolutely expert in what they do. The same with painting and decal application.
The workshop of which my own company forms a part is recognized by some of the biggest Italy-based brands as producing the best carbon-alloy bonds in the industry. Each one is done by hand. Not necessarily by the same craftsman. But the attention to detail and integrity of the procedure is present in each pair of hands that handles it.
Anyhow, finding a way into the OEM and ODM maze may mean having to find a way out down the track and getting back to doing what you do best. But one thing to note is that simple divisions between “mass” production and “hand”-made are not particularly helpful in appreciating what goes on.