This Week's Herman Trend Alert

Leadership in Normal 2.0

  The Herman Trend Alert

July 16, 2003

Manufacturing Maturing

American manufacturing is maturing and changing, but not going away. Technology, innovative supply chain systems, and dedicated employees will keep manufacturing strong. Employment opportunities will grow with the demand for specialized skills, customized manufacture, and customer responsiveness. The challenge will be attracting young people to manufacturing occupations and providing the necessary skills training.

While many manufacturing and assembly jobs have migrated to countries with lower labor costs, some products will continue to be produced in the United States. Furniture produced for years by proud craftsmen in American factories is now manufactured in other countries. Furniture produced in China, for instance, is making great inroads into the American market. A significant part of the geographic shift of textile manufacturing is linked to furniture. The furniture manufacturing industry, like many others, is in the midst of unsettling change. American manufacturing will concentrate on design, short-run production, quality goods, and merchandise best made domestically.

In response to market demands for higher quality products, the mattress business, a subset of the furniture industry, is changing. Shoppers-- individual, and also institutional--are becoming much more discriminating about what bedding they purchase. While the low end market will always be part of the landscape, there is noticeable growth in the high end of the product lines.

More hotels are shifting to higher quality, recognizing that part of their competitive positioning for valuable business travelers is a restful night's sleep. Some hotels are so well known for their mattresses that happy guests want to buy the same kind of mattress for their homes. Relationships between the hotels and their mattress manufacturers allow those purchases to occur on a fairly regular basis.

Mattress production in the United States is symbolic of a segment of manufacturing. Craftsmanship, price, and delivery time are all factors in an industry which has become highly responsive with something similar to a just-in-time supply chain. But mattresses do not manufacture themselves. Talented workers---from designers to production specialists---are needed to get the job done.

Smart manufacturers will train people effectively, lead them well, and schedule production to maintain a stable workforce to assure quality and efficiency.

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