Summary
The United States is on the verge of a manufacturing renaissance. This return to US manufacturing results from a desire for supply chain resilience (national capability and productivity), geopolitical risk (national security), new tariff policy, and investment incentives.
Companies like Micron, Ford, and Hasbro have announced billions in investments in US plants. SMEs (small and mid-size enterprises) seeking these opportunities face fierce competition. To win, SMEs must stand out.
Who will succeed? The companies that use agility, innovation, and technology. This article shares strategies to shine in onshoring.
SMEs Standing Out in the US Manufacturing Renaissance
The United States is on the verge of a manufacturing renaissance. This return to US manufacturing results from a desire for supply chain resilience (national capability and productivity), geopolitical risk (national security), new tariff policy, and investment incentives.
Companies like Micron, Ford, and Hasbro have announced billions in investments in US plants. These companies and others plan to source from local suppliers. SMEs (small and mid-size enterprises) seeking these opportunities face fierce competition. To win, SMEs must stand out.
Who will succeed? The companies that use agility, innovation, and technology. This article shares strategies to shine in onshoring.
SME Opportunities to Grow
As US Trade Policy redesigns the global marketplace, more firms prioritize US suppliers. Local sourcing cuts lead times and increases flexibility. It also avoids tariffs. But success isn’t guaranteed. SMEs have the opportunity to grow. Yet, they also have limited resources and time to turn opportunity into success. SMEs meet this challenge through differentiation, financial stability (funding), and capability. Those who do will get the contracts.
Stand Out Strategies for SMEs
The successful SME must highlight its strengths. Adopt bold strategies. Capture manufacturers’ attention. How? Here are some key strategies to get started:
Master Niche Skills
With limited resources and time, SMEs should target specific niches. Focus enables SMEs to maximize the impact by focusing resources like a laser rather than scattering them with the hope someone will buy. Optimally, an SME’s niche selection should align with its capabilities. An SME may target a high-growth or underserved niche. It all depends on what provides the most potential (viability) and best fit (credibility). Focus on where your capabilities work best, then demonstrate a track record of success. Don’t say, “Trust me, we’ll figure this out.” Instead, you can make a case that highlights your strengths and abilities.
You may be a perfect fit for semiconductors, EVs, or toys. Whatever is the best fit provides the best chance. So, if you can make precision parts, you may target Micron’s New York plant. Look to Ford’s Tennessee EV plant if you can produce lightweight materials. Maybe you lean toward rapid product design and prototyping that enables you to create unique toy molds for Hasbro.
The more unique your skill sets and capabilities, the more competitive you will be. If you can develop exclusive processes around technology (think 3D printing, etc.) that enable you to cut development time or time to market, you will stand out. Remember, proprietary processes, patented methods, designs, etc., all position you where competitors can’t.
Once you have your target niche, share expertise via case studies, social media, and trade organizations. Companies with certifications (ISO, IATF, CMMI, CMMS, etc.) relevant to your niche demonstrate your capability and credibility. Start developing relationships with decision-makers and buyers at target companies to build trust.
Use Smart Tech
SMEs can excel in onshoring with Industry 4.0 tools. Install IoT sensors. Use AI for quality. Apply predictive maintenance. Develop the ability to connect to companies with tools like GlobalFoundries’ platforms. Start with cheap ERP and IoT. Scale tech as contracts grow. Boost efficiency. Win contracts with reliable, data-driven production. Your connectivity capability and real-time inventory data can enable you to outpace your competition. You must invest in your business and manufacturing capabilities. Try cloud ERP systems. Use open-source IoT. Look for tech that is scalable as the business grows.
Stay Agile and Credible
SMEs need to adapt quickly. Rapid adaptability is an advantage that big firms rarely have. The ability to adjust production quickly and customize parts could position you as an ideal supplier for ABB’s North Carolina plant. If you’re going for their business, you highlight flexibility and other differentiating factors in your proposal. Can you offer rapid prototypes? Do you use 3D printing? Hasbro and others may find those capabilities crucial for product development. If you can deliver samples in days rather than weeks or months, do it!
In addition to production-related capabilities, demonstrate your business capability and create a clear line of communication. Consider using account managers and product development leads to facilitate activities. Communicate clearly. Be honest about your current and planned capabilities. Maintain credibility.
Boost Visibility (Digital and Local Presence)
Your website must be professional, focused, and current. So, should your listings be manufacturing databases like ThomasNet? If you want to do business with the big guys, you must be where they are; join organizations like the MEP Nation Network’s Supplier Scouting Initiative (MANTEC, NWIRC, etc.).
Get noticed by your niche with social media (LinkedIn, X, etc.), case studies, and trade show presentations. Hone your marketing and media materials to increase engagement and influence with industry influencers and decision-makers. Highlight your local roots and stress proximity to your target niche’s locations. Promise fast delivery. Cut freight costs. Then, keep those promises.
Forming Strategic and Formal Relationships
Sometimes, going it alone means missing out on a contract. Look for strategic alliances where you can team up with other SMEs. Formalize teaming agreements to offer combined services and expertise. Another option is to create legal joint ventures that enable you to provide flexible manufacturing options. These may be highly attractive to Toyota’s Indiana plant or Tennessee’s EV hubs. Another differentiation is to maximize local workforce development by working with trade schools (like Williamson College of the Trades), colleges, and worker training programs.
Tap Government Support
Explore what government programs and resources are available to boost your business. Contact federal, state, and local government and private sector entities focused on economic development. Do some research using sites like manufacturing.gov to see what resources are available. Use MEP services. Get cost-effective training. Optimize processes. Connect with companies like Stanley Black & Decker to learn about supplier programs. Apply for grants. Fund tech upgrades. Train workers. Join manufacturer groups. Network with buyers. Track onshoring trends.
Get Procurement Ready
If you want to win the contract, then develop your skill set. Your ability to write clear RFP responses that highlight expertise and agility. Major manufacturers prioritize these factors when selecting suppliers:
Develop a plan to demonstrate your capability. Review your metrics. Ensure that your records are complete and current. Be audit-ready every day. Offer extras. Provide just-in-time delivery. Manage inventory. Support aftermarket needs. Do what your customer wants at a profit, as promised. Make sure your plan and funding support those promises.
- · Quality: Consistent, high-quality products meeting industry standards and specifications.
- · Reliability: On-time delivery and dependable supply chain performance.
- · Cost: Competitive pricing and cost-effectiveness.
- · Capacity: Ability to meet volume demands and scale production.
- · Innovation: Technological expertise and ability to support new product development.
- · Compliance: Adherence to regulatory, environmental, and ethical standards.
- · Communication: Clear, responsive, and collaborative engagement.
SME Challenges
SMEs face hurdles. Limited budgets mean you must focus your resources effectively. Maximize your cash by concentrating on a niche that fits your business. If you don’t have a formal business plan and aren’t currently using budgets and forecasts to control your company, it’s time to develop them. If you don’t know where to start, invest some of your resources with an expert who can guide you through professionalizing your business systems and tools. Over the years, Many successful companies have called me after they tried to scale their business without a plan. They called me when the business imploded due to a lack of planning and tools to manage growth.
Managing Growth with the Right Tools
You must manage the business and have a working capital plan to grow. You must make selective investments in the business systems to support growth and sophisticated customers like Ford Motor Company, Hasbro, Hyundai, The Lego Group, and others. Invest in your business, including ERP and accounting. You don’t have to use the most expensive tools, but you need the right ones to monitor product cost, customer profitability, etc.
Apply for funding now. Whether you can find government grants or loans, private funders, or lines of credit and bank loans, it is time to implement them. If you don’t have relationships with bankers and lenders, get referrals and contact community and regional banks. Talk with your state and local economic development groups and see what they can do.
Act Now, Make a Plan
A robust business plan that includes scenarios (worst, best, and most likely) will go a long way toward building confidence in your business. Having a plan creates credibility for customers, vendors, stakeholders, investors, and bankers. Take the time to develop a plan, strategies, and finances to support it.
The US manufacturing renaissance offers big opportunities for SMEs. Develop your plan, specialize in niches, use smart tech, stay agile, tap the government for help, build relationships, get funding, act fast, research manufacturers, boost capabilities, network now, connect with MEP centers, update your website, and attend industry events. SMEs with bold moves will win.
