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Made in America: Why Motorola is making smartphones in America again

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Manufacturing is returning to the US

Manufacturers are starting to understand the reasons to bring manufacturing back from overseas.  US consumers care about where their products are made.  Wages are on the rise overseas, but remain stable in the US.  Better products result from tighter turnaround time between design and engineering teams.

Motorola recently announced that their new flagship smartphone, designed to compete with the iPhone 5S and Galaxy lines, will have final assembly done in a Texas factory.

Other companies are following suit.

Motorola’s Announcement for the MotoX

Motorola’s Moto-X smartphone has recently come out to critical acclaim.  It is a high end smartphone comparable to Apple’s new iPhone 5S.  (See CNET’s comparison of the MotoX versus iPhone 5S.)

The Verge recently published an article on the manufacture of the new phone, designed to complete with the Galaxy and iPhone lines.  (See “Made in America: A look inside Motorola’s Moto X factory“.)  In it, they talk about how Motorola rebuilt an old Nokia factory in order to perform final assembly of their top-of-the-line smartphone in Texas.

From The Verge:

[The MotoX is] going to be built in Texas, in a 480,000-square-foot facility previously used to manufacture Nokia phones. Woodside says Moto X will be the first smartphone built in the United States, and was clearly proud of that fact

 

Some of the reasons cited for US manufacture:

  • Quicker turnaround time (faster fulfillment)
  • Direct fulfillment for customized, made-to-order relationships (better customization)
  • The proximity of the design and manufacturing engineers enables the design team to make tweaks to the phone and quickly push them into production (tighter loop between design and manufacturing teams)

 

Further, the Motorola CEO explicitly mentioned the following business reasons for moving manufacturing:

There is a premium [with building in the US] but it’s not material to the economics of the business. It’s a myth that you can’t bring manufacturing here because it’s too expensive… We’ve observed that wages in Asia are going up, wages here are relatively steady, consumers care more about where their products are being built, and you have advantages of having design close to your manufacture. Those advantages will well outweigh the costs that we have today and those costs will go down over time.

 

The rush to manufacture overseas was primarily driven by the bottom line, which was a product of a lower standard of living in poorer countries.  Lower labor costs and fewer regulations meant companies saved huge sums of money by moving all manufacturing to China, Korea, and other centers of manufacture.

Now, however, some manufacturing is coming back.   Cheap toys will continue to be made abroad, but innovative, high quality manufacturing is returning.  And it will bring high quality manufacturing jobs back with it.

SBIR Grants: Step 2 – Find a Solicitation

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The US Federal Government runs a program titled “Small Business Innovation Research” that gives grants to support R&D efforts of small, US companies.

This is the second post in a series of how-tos to help a company apply for an SBIR Grant.

  1. How to determine eligibility and register for an SBIR small business grant
  2. Find a Solicitation (this post)

Finding a Solicitation

In order to maximize your likelihood of receiving an award, I recommend identifying solicitations closely related to your core business.  If you manufacture medical device parts, and would like some money to R&D a new device, look at the medical solicitations.

On the other hand, if you manufacture metal widgets, I would not recommend applying for a software development grant.

One of the three primary criteria to evaluate the applications is how well key personnel’s qualifications relate to the solicitation.

 

First, search for a topic.  The DoD SBIR program operates their official Topic Search site at http://www.dodsbir.net/Topics/Default.asp, but it can be difficult to use.  I recommend the free (and extremely useful) SBIRSource.com, a privately run site that has better search and ties in more information than the official site offers.

 

Spend some time thinking through your envisioned solution.  Try to keep in mind the evaluation criteria:

  1. Scientific and Technical Merit (is it possible? Will it solve the problem as posted?)
  2. Key Personnel’s Qualifications (can your company complete the solution?)
  3. Commercialization Potential (can this be turned into a product to sell to other military and scientific groups?)

The third point is the most vague, but also the most crucial.  If you intelligently select a topic, you should be able to score well on points 1 and 2.  Commercialization potential is vague, but all it really means is this: is the solution generalizable so that it solves other groups problems?

That requirement exists because this program wants to avoid an over-specific solution to the problem limited to the sponsor.  After the Phase I (Proof of Concept) stage, the follow on SBIR grant phases push awardees towards solving problems that you can use to build your company.

That requires an understanding of the potential market.  It is also where you can focus on your vision — how you propose to solve this problem, and other problems like it.

 

Please feel free to contact me ( leleu@industrialinterface.com with any questions and comments.

SBIR Grants: Step 1 – Eligibility and Registration

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The US Federal Government runs a program titled “Small Business Innovation Research” that gives grants to support R&D efforts of small, US companies.

This is the second post in a series of how-tos to help a company apply for an SBIR Grant.

  1. How to and register for an SBIR small business grant (this post)
  2. How to Find a Solicitation

I have created a worksheet to help you through this process.  I suggest printing the worksheet before proceeding to the SBIR Registration site.

Download Registration Worksheet 

Step 1: Determine Eligibility

These grants are intended for US companies with less than 500 employees.  For more details, please see the full list of SBIR Grant Eligibility Requirements.

Step 2: Register with the SBIR program

First, you need to register with the SBIR system.  I created a worksheet to help you make sure you have all the necessary information.  All registrations are free.

Some information is not required unless you are awarded a grant.  I recommend completing only the required information until you have submitted your grant application.

You can visit the SBIR Registration Page to look up your current status.  This is also where you will register your company.  You only need to complete this process once, regardless of the number of applications you submit.

Required Information

Before Submitting an Application:

  • Company name, address, city, state, zip
  • Federal Tax ID (if not yet incorporated, your SSN can be used temporarily)
  • Your SBA SBC ID. This is a number that verifies your company’s status as a small business (based on the eligibility requirements above), and can be obtained at http://www.sbir.gov/firm_user_register
  • History of your company’s SBIR grants (see worksheet for details)

After Application Submission, but Before Grant:

 

I have created a worksheet with the minimum info required to register.

Download Registration Worksheet 

 

Once you have the necessary contact information, registration numbers, and other codes, you should proceed to the SBIR Registration site to fill out the application.

SBIR Eligibility Requirements

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The US Federal Government runs a program titled “Small Business Innovation Research” that gives grants to support R&D efforts of small, US companies.

 

The grants are available to all US companies who meet the following requirements:

  • Fewer than 500 employees
  • For profit, US owned and operated small business
  • The designated project lead must spend at least half their time employed by the small business
  • Subcontractors and consultants may be used, but at least 2/3 of the work must be done by company employees
  • All work must be done in the United States

How 3D Printing Will Generate Business for Production Manufacturers

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Over at Innovation Investment Journal, Peter Friedman has an excellent article identifying the large scale manufacturing shortcomings of additive 3D printing.  In short, he says that 3D printing can’t handle the speed or volume requirements needed in production scale manufacturing.

However, that conclusion misses the point for small and medium manufacturers.  The importance of 3D additive printers is not that they will replace large scale manufacturing (after all, they can’t take advantage of economies of scale).  Their role is to enable innovators and entrepreneurs to more deeply explore commercial viability.

Inexpensive 3d printing will enable hobbyists and amateurs to cheaply prototype their concepts at a scale that they can sell.  This scale (1-500+ units) isn’t well served by existing manufacturers, who have large minimum order requirements and/or high start up costs.

The next generation of innovative products will be created by designers who can prototype and build manufacturable goods in prototype and small quantities.

 

The blue area on the graph indicates where 3D printing provides significant value

The blue area on the graph indicates where 3D printing provides significant value

The blue area on the graph indicates where 3D printing provides significant value

New products will emerge from a cottage industry of innovation.  Once economic viability is demonstrated, these projects will need to transition to professional manufacturing, to take advantage of economies of scale.  Manufacturers who specialize in transitioning a product from additive 3d printing (10-500 units) to large scale manufacturing (1k+ units) will have partners in large growth phases.

 

Takeaway points:

  1. Role of 3d printers is to enable innovators and entrepreneurs to more deeply explore the commercial viability of their market and product.
  2. Inexpensive 3d printing will enable hobbyists and amateurs to cheaply prototype their concepts at a scale that they can sell
  3. The next generation of innovative products will be created by designers who can prototype and build manufacturable goods in prototype and small quantities.
  4. Manufacturers who specialize in transitioning a product from additive 3d printing (10-500 units) to large scale manufacturing (1k+ units) will have partners in large growth phases.

 * (I defined “proof of concept” at 1 unit, non-manufactured, non-sellable.  Sellable prototype is one that could be build in quantities of 10-1000.  Production scale is over 1,000 units.  Costs are estimated, although the actual numbers are less important than the shape of the graph.)

New Site Design for Flair Electronics

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We are excited to announce a new business partner and web-design client in Flair Electronics! Take a look at the new site, and let us know what you think.

Flair Electronics Security Systems

Flair Electronics was founded in 1967 and has worked in the security market since its inception, specializing in Magnetic Contacts, Graphic Annunciators and Perimeter Security Systems for many Residential, Commercial, and High Security Applications.

Also be sure to check out their redesigned and easy to access Download Center containing hundreds of Product Datasheets, Instruction Manuals, Technical Papers, and more.

In the coming months we will also be working with Flair on various other business development projects, including email marketing and lead generation through our new engineering research tool, Industry Cortex.

Please do not hesitate to contact us at info@industrialinterface.com to inquire about our Web Design, Advertising, and Consulting services.  We look forward to hearing from you!

The next generation of industrial research tool has arrived.

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We’ve just launched our new research tool for the manufacturing industry.  It’s called Industry Cortex.

Right now we’re testing it with information on 2,500 adhesive suppliers, their products, services, datasheets, images, and more.  Check it out and leave us some feedback in the comments.  Thanks for all the support from the suppliers, manufacturers, trade groups, and industry professionals that have helped us take this next step.

Read the rest of this entry »

Printing, Steel & Solar directories have come online

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Check out our latest industrial directories.  If you’ve got a product or service you’re eager to get to market quickly and efficiently, contact us and we can help by building a custom directory for your brand or business.

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