It is important to keep in mind that Asia covers a lot of nations and cultures that sometimes have very little in common. From Japan with its very advanced economy to nations like Laos that are just starting to become more integrated into the world economy, the region is as diverse as the rest of the world.

With this diversity, there are opportunities for every type of manufacturing. Countries like Japan and Singapore have given up their labor intensive industries to cheaper competitors with others to include Taiwan and South Korea are not so far behind. Even China is losing some of its competitiveness in low-wage, labor-intensive industries, as Vietnam and others take more of this business. Be it lower or higher end manufacturing, one thing these nations have in common is that manufacturing has remained an important part of their economies.

Reasons for manufacturing in Asia
Although labor costs in Asia are gradually increasing in most areas, the costs in many countries are still considerably lower than in the West. Furthermore, this large labor pool is often much more educated and disciplined than in other areas. This access to skilled yet relatively lower-cost labor makes Asia very attractive for manufacturers.

Since Asia has been a major manufacturing hub for a while, it has had time to gain a lot of experience, and there are many top notch manufacturers to choose from. Networks of suppliers and expertise now exist in Asian manufacturing centers, sometimes offering new and flexible techniques that often cannot be found anywhere else.

Apart from investing in education, many Asian nations have also made significant investments and improvements in their infrastructure. This has served to prevent bottlenecks, lower costs and improve delivery times.

Disadvantages of manufacturing in Asia
Manufacturing sourcing necessitates the sharing of information. This is never something companies want to do, and it is made more troublesome when that information is being shared with an entity which is so far away. Therefore, any company manufacturing in Asia needs to carefully consider what intellectual property it will share while making sure it has the appropriate NDAs and patents in place.

Having manufactures on the other side of the world adds to administrative burdens too. Different time zones mean different business hours as well as different national holidays. This need to coordinate things so far apart can be an administrative burden. At times leads to more serious issues such as when a problem becomes worse simply because it was not addressed in a timely manner.

The fact that the languages, cultures and systems are different too is no academic matter. What is acceptable in one culture may be a great insult in another. In addition, different systems and ways of doing business can cause friction. While factories that manufacture goods for outside markets do have experience in this field, problems still arise, particularly with language and quality issues. The factory representatives may hide the fact they do not understand or miss the point without even realizing it and different ideas about quality take a long time to overcome.

Making manufacturing in Asia work better
There are many ways to minimize the drawbacks of manufacturing in Asia. This should start with finding an agent or other third party that can be trusted. This can eliminate the need for a lot of business trips, employing multilingual staff and nip small problems in the bud before they turn into bigger ones. It can also help in cutting through bureaucracy and other problems. Steps need to be taken to ensure this third party is not connected to the manufacturer in any way and has no conflict of interests.

Sampling and costs quotes need to be taken very seriously. Repeatedly check to make sure the factory understands just what is required and quotes accurately. Samples need to be confirmed that represent exactly what the buyer requires before going into production, and samples of the first products produced should also be carefully checked.

Quality control needs to be thorough at every turn. The manufacturer may say they understand exactly what is required when, in fact, they do not. This means quality control steps must be taken throughout the manufacturing process. In addition, goods should never leave the factory until they have been inspected. However, the manufacturer must understand that none of these inspection processes release them from their responsibility and liability for anything that is not manufactured to standards.

Before placing any other, it is necessary to be sure of all details about the order to include production times, ports, shipping and customs. Do not take anything for granted.

Finally, while conditions and wages are rising for workers, manufacturing in Asia still involves the unethical exploitation of workers at times. Check with suppliers to ensure suppliers are following proper labor practices.

China
China is the top manufacturer in the developing world. In 1979, market reforms began in costal regions. Since that time, China has gradually emerged from isolation to become the factory of the world for many products. Although China started with products of low value and quality, it has rapidly improved its infrastructure, manufacturing know-how and skills to become the producer of many high tech products of superior quality and exceptional value.

China’s manufacturing advantages include a large, skilled, disciplined work force, government incentives for both foreign and domestic manufacturing companies, low labor costs and a currency which many consider to be undervalued.

China’s rapid growth has contributed to rising wages and a rising currency. These have reduced some of China’s manufacturing cost advantages. However, China continues to offer considerable cost savings for the manufacture of most products. China entered the World Trade Organization (WTO) in 2001. Since that time, continued market reform and infrastructure improvements have attracted massive foreign investment and improved China’s manufacturing base. China most likely will remain the best place to manufacture many goods for the foreseeable future.

Hong Kong
As Hong Kong becomes more integrated with China, the importance of manufacturing to the Hong Kong economy has decreased. China’s abundant labor attracted a Hong Kong investment boom in south China and beyond and fueled growth in both economies. Production, particularly in labor-intensive industries, has gradually shifted to China. However, Hong Kong has retained some significant light manufacturing in industries such as garments, plastics, electrical and electronic equipment, appliances, metal products, watches, jewelry, and toys.

Hong Kong manufacturers will remain an important bridge to China in the foreseeable future due to their extensive experience in Western business practices, excellent infrastructure and proximity to China.

Taiwan
As its economy has grown and advanced, Taiwan has seen a gradual decline in labor-intensive manufacturing. The mainstay of its manufacturing has shifted to capital and technology-intensive industries, such as chemicals, information technology, electrical equipment, and electronics. Taiwan has become the world’s top manufacturer of many information technology products.

Unlike many of its Asian neighbors, Taiwan’s economy is dominated primarily by small and mid-sized firms. This makes Taiwan very flexible in adapting to market changes.

India
Although exports have surged in recent years, India’s export-driven manufacturing remains limited in comparison to countries like China due to regulatory, infrastructure and other barriers. Major export products include textiles, jewelry and chemicals. As it works to create a knowledge-based economy, India has become well established in the export of services such as engineering and software.

South Korea
With its rapid economic development and increase in wages, South Korean manufacturing has shifted to high technology and high value-added products. Major export industries now center on electronics, automobiles, machinery, shipbuilding and petrochemicals.

Thailand, Indonesia, Vietnam
Thailand, Indonesia and Vietnam all have emerging manufacturing sectors. Of these Southeast Asian countries, Thailand is the most open to foreign investment and is therefore the most developed with growing exports in clothing, wood products, jewelry, electronics, and consumer appliances.

Indonesia’s major export industries include textiles, food processing, tobacco and timber products with growth in machinery and other sectors.

With its large, low-cost labor force and opening economy, Vietnam has attracted increased foreign investment and has increased its exports, particularly as costs in China rise. Some of Vietnam’s major export products are garments and footwear.