# I just lost my largest customer to China. **URL:** \ **Category:** NYSpeed Off Topic\ **Created:** [March 10, 2006, 7:31pm UTC](https://forums.speedlife.net/t/i-just-lost-my-largest-customer-to-china/9153 "2006-03-10T19:31:08Z")\ **Posts on this page:** 20\ **Page:** 2
**Author:** ![d3x](https://avatars.discourse-cdn.com/v4/letter/d/8491ac/32.png) [@d3x](https://forums.speedlife.net/u/d3x)\ **Post date:** [March 11, 2006, 7:56am UTC](https://forums.speedlife.net/t/i-just-lost-my-largest-customer-to-china/9153/21 "2006-03-11T07:56:15Z")
our biggest customer (Joy Mining Machinery) tried the same thing a few years back. they wanted a price decrease we wernt capable of meeting. we had to lay-off 3/4 of the company and just about went outta buisness. but what Joy found out is that quality goes out the door and delivery schedules are never met when you take the cheaper route. so we eventually got alot of their buisness back along with buisness from a few other companies like Caterpillar, Komatsu, and Sandvik. these companies are gunna expect price cuts every year and we have to hope we can change our processes and probably reduce paid wages to employees to meet these cuts. so times have been very uneasy and i imagine its the same at most machine shops. fortunatly the parts we make _have_ to work as expected in heavy machinery or the resulting down time costs the equipment owners alot of money. so they probably wont jump ship overseas yet till places like china can mantain a certain level of QC and traceability like ISO certification which im sure its only a matter of time. i just hope the people of these countries are able to get their wages up by then so we can be atleast relativly competative. ---
**Author:** ![Juan](https://avatars.discourse-cdn.com/v4/letter/j/a698b9/32.png) [@Juan](https://forums.speedlife.net/u/Juan)\ **Post date:** [March 11, 2006, 7:59am UTC](https://forums.speedlife.net/t/i-just-lost-my-largest-customer-to-china/9153/22 "2006-03-11T07:59:00Z")
> [@JoesTypeS](#): > > AWDrifter runs a non-union shop…manufacturing jobs are moving to China b/c people get paid $1/hr to do the work and that’s ok b/c the gov’t subsidizes their living by giving them $5/mo rent. America’s free market drives up living costs, and thus wages. If you got rid of unions you’d just increase the size of the lower & lower middle class, and you still wouldn’t be competitive (other than automotive industry, and even then, the biggest problem is in design). You just CANNOT beat Chinas product costs. It’s seriously impossible to do. Unless the gov’t starts imposing tarrifs on Chinese goods at a rate to offset the production costs, products like those AWDrifters shop makes are going to continue to move over there. :word: and good point Josh about the Unions, they have had their time…but now it’s just ridiculous ---
**Author:** ![rskrause](https://yyz2.discourse-cdn.com/flex034/user_avatar/forums.speedlife.net/rskrause/32/7367_2.png) [@rskrause](https://forums.speedlife.net/u/rskrause)\ **Post date:** [March 11, 2006, 8:04am UTC](https://forums.speedlife.net/t/i-just-lost-my-largest-customer-to-china/9153/23 "2006-03-11T08:04:26Z")
It’s fascinating that we (collectively) are willing to finance China’s ascendancy. The Soviet Union would never have failed if we had a huge trade deficit with them as we do with the ChiComs. Here’s my very own conspiracy theory: there is a “Chinese connection” in politics and they are cleverly buying off just the right people to allow this to continue. That, and greed as the very rich are the main US beneficiarys of “free trade”. Remember that nut case, Ross Perot? Maybe we should have listened to him a little more when he talked about “that sucking sound”. Chaina is more a threat to the US than Iran. ---
**Author:** ![Zer0DazE](https://yyz2.discourse-cdn.com/flex034/user_avatar/forums.speedlife.net/zer0daze/32/7624_2.png) [@Zer0DazE](https://forums.speedlife.net/u/Zer0DazE)\ **Post date:** [March 11, 2006, 8:07am UTC](https://forums.speedlife.net/t/i-just-lost-my-largest-customer-to-china/9153/24 "2006-03-11T08:07:09Z")
> [@JoesTypeS](#): > > AWDrifter runs a non-union shop…manufacturing jobs are moving to China b/c people get paid $1/hr to do the work and that’s ok b/c the gov’t subsidizes their living by giving them $5/mo rent. America’s free market drives up living costs, and thus wages. If you got rid of unions you’d just increase the size of the lower & lower middle class, and you still wouldn’t be competitive (other than automotive industry, and even then, the biggest problem is in design). You just CANNOT beat Chinas product costs. It’s seriously impossible to do. Unless the gov’t starts imposing tarrifs on Chinese goods at a rate to offset the production costs, products like those AWDrifters shop makes are going to continue to move over there. just because his shop is non union doesnt mean unions dont affect his business. he has to buy supplies and equipment from somewhere… i bet they are produced by a union worker. ---
**Author:** ![adamantairman](https://avatars.discourse-cdn.com/v4/letter/a/53a042/32.png) [@adamantairman](https://forums.speedlife.net/u/adamantairman)\ **Post date:** [March 11, 2006, 8:08am UTC](https://forums.speedlife.net/t/i-just-lost-my-largest-customer-to-china/9153/25 "2006-03-11T08:08:37Z")
How does Great Britain do it? There industry died decades ago, and they still have the strongest currency in the world, so there’s got to be a way for the US to “sustain”. ---
**Author:** ![dozr](https://avatars.discourse-cdn.com/v4/letter/d/41988e/32.png) [@dozr](https://forums.speedlife.net/u/dozr)\ **Post date:** [March 11, 2006, 8:55am UTC](https://forums.speedlife.net/t/i-just-lost-my-largest-customer-to-china/9153/26 "2006-03-11T08:55:58Z")
In our business, we were facing a time last year where it looked like much of the IT work was going to be outsourced to India, much of it already was. To Quote the owner of our company: “There’s a big reversal in not sending things overseas and outsourcing, instead sending them to rural America to have them done,” he said. "In the IT world, Buffalo is considered rural America. You might get a $10 an hour engineer in India, but by the time you add on all the project management costs and extras you are paying Buffalo rates, which are still half the costs of New York City rates, and a third of California rates," McCaskey said. “It makes more sense to send it to rural America.” ---
**Author:** ![MrFliGSR](https://yyz2.discourse-cdn.com/flex034/user_avatar/forums.speedlife.net/mrfligsr/32/3069_2.png) [@MrFliGSR](https://forums.speedlife.net/u/MrFliGSR)\ **Post date:** [March 11, 2006, 9:02am UTC](https://forums.speedlife.net/t/i-just-lost-my-largest-customer-to-china/9153/27 "2006-03-11T09:02:02Z")
> [@rskrause](#): > > It’s fascinating that we (collectively) are willing to finance China’s ascendancy. The Soviet Union would never have failed if we had a huge trade deficit with them as we do with the ChiComs. Here’s my very own conspiracy theory: there is a “Chinese connection” in politics and they are cleverly buying off just the right people to allow this to continue. That, and greed as the very rich are the main US beneficiarys of “free trade”. Remember that nut case, Ross Perot? Maybe we should have listened to him a little more when he talked about “that sucking sound”. > > Chaina is more a threat to the US than Iran. We are in debt to CHINA, that’s why. ---
**Author:** ![Jack](https://yyz2.discourse-cdn.com/flex034/user_avatar/forums.speedlife.net/jack/32/7613_2.png) [@Jack](https://forums.speedlife.net/u/Jack)\ **Post date:** [March 11, 2006, 10:27am UTC](https://forums.speedlife.net/t/i-just-lost-my-largest-customer-to-china/9153/28 "2006-03-11T10:27:09Z")
JEG - TRICO was the company that left, but I believe that was only their local production. Thats where I got my TV from, the son of the owner. 😉 ---
**Author:** ![Dr.Stevil](https://avatars.discourse-cdn.com/v4/letter/d/da6949/32.png) [@Dr.Stevil](https://forums.speedlife.net/u/Dr.Stevil)\ **Post date:** [March 11, 2006, 10:37am UTC](https://forums.speedlife.net/t/i-just-lost-my-largest-customer-to-china/9153/29 "2006-03-11T10:37:06Z")
> [@mike125k](#): > > :word: Josh it right. I saw the same things when I was a supervisor in the auto industry, different company, same bullshit. I won’t go as far as saying unions need to be ended completely, they have their purpose. But they need to wake up and realize what they are doing to themselves and take DRASTIC concessions to get to a profitable level for the company. Even with that though, companies need help from the government to end this free trade bullshit that makes it way too easy to send jobs overseas. agreed… it’s deffinitly hurting the country ---
**Author:** ![zwarbyt](https://yyz2.discourse-cdn.com/flex034/user_avatar/forums.speedlife.net/zwarbyt/32/7623_2.png) [@zwarbyt](https://forums.speedlife.net/u/zwarbyt)\ **Post date:** [March 11, 2006, 10:56am UTC](https://forums.speedlife.net/t/i-just-lost-my-largest-customer-to-china/9153/30 "2006-03-11T10:56:39Z")
arent you republican? time to do a gut check there budy ---
**Author:** ![HotRodKid](https://yyz2.discourse-cdn.com/flex034/user_avatar/forums.speedlife.net/hotrodkid/32/7609_2.png) [@HotRodKid](https://forums.speedlife.net/u/HotRodKid)\ **Post date:** [March 11, 2006, 11:43am UTC](https://forums.speedlife.net/t/i-just-lost-my-largest-customer-to-china/9153/31 "2006-03-11T11:43:37Z")
> [@AWDrifter](#): > > Trico is the wiper company that went to Mexico. > Fisher Price also had three plants move to Mexico; EA, Holland, and Medina. and at least one of the rich products plants went to brazil ---
**Author:** ![jeeves744](https://yyz2.discourse-cdn.com/flex034/user_avatar/forums.speedlife.net/jeeves744/32/7619_2.png) [@jeeves744](https://forums.speedlife.net/u/jeeves744)\ **Post date:** [March 11, 2006, 11:44am UTC](https://forums.speedlife.net/t/i-just-lost-my-largest-customer-to-china/9153/32 "2006-03-11T11:44:15Z")
> [@rskrause](#): > > It’s fascinating that we (collectively) are willing to finance China’s ascendancy. The Soviet Union would never have failed if we had a huge trade deficit with them as we do with the ChiComs. Here’s my very own conspiracy theory: there is a “Chinese connection” in politics and they are cleverly buying off just the right people to allow this to continue. That, and greed as the very rich are the main US beneficiarys of “free trade”. Remember that nut case, Ross Perot? Maybe we should have listened to him a little more when he talked about “that sucking sound”. > > Chaina is more a threat to the US than Iran. No its called world economy. If you arent competetive with making something, you dont make it. And the US isnt competivite with manufaturing jobs. Its no conspiracy. If the US tried putting tarrifs and such and foreign goods to try to help US companies it wouldnt do any good and would end up fucking us over even more. Sorry, the days of being able to make a very good living bolting on a bracket on an assemby line in the US are dying. Why do you think now a days a degree isnt an option but a necessity? All the US will have are very basic jobs and then stuff that highly technical in one way or the other. ---
**Author:** ![Jeller](https://avatars.discourse-cdn.com/v4/letter/j/bc8723/32.png) [@Jeller](https://forums.speedlife.net/u/Jeller)\ **Post date:** [March 11, 2006, 12:36pm UTC](https://forums.speedlife.net/t/i-just-lost-my-largest-customer-to-china/9153/33 "2006-03-11T12:36:17Z")
> [@JoesTypeS](#): > > Unless the gov’t starts imposing tarrifs on Chinese goods at a rate to offset the production costs, products like those AWDrifters shop makes are going to continue to move over there. ding, ding, ding, we have a winner. :word: ---
**Author:** ![Deuce](https://yyz2.discourse-cdn.com/flex034/user_avatar/forums.speedlife.net/deuce/32/7614_2.png) [@Deuce](https://forums.speedlife.net/u/Deuce)\ **Post date:** [March 11, 2006, 1:48pm UTC](https://forums.speedlife.net/t/i-just-lost-my-largest-customer-to-china/9153/34 "2006-03-11T13:48:17Z")
it really is a shame how things areevolving here… ---
**Author:** ![JoesTypeS](https://yyz2.discourse-cdn.com/flex034/user_avatar/forums.speedlife.net/joestypes/32/7190_2.png) [@JoesTypeS](https://forums.speedlife.net/u/JoesTypeS)\ **Post date:** [March 11, 2006, 2:46pm UTC](https://forums.speedlife.net/t/i-just-lost-my-largest-customer-to-china/9153/35 "2006-03-11T14:46:58Z")
> [@Jeller](#): > > ding, ding, ding, we have a winner. :word: Walmart would never allow that to happen. ---
**Author:** ![jeeves744](https://yyz2.discourse-cdn.com/flex034/user_avatar/forums.speedlife.net/jeeves744/32/7619_2.png) [@jeeves744](https://forums.speedlife.net/u/jeeves744)\ **Post date:** [March 11, 2006, 3:05pm UTC](https://forums.speedlife.net/t/i-just-lost-my-largest-customer-to-china/9153/36 "2006-03-11T15:05:52Z")
just a little read from my bases of world economics class i am taking right now about free trade and tariffs. > The case for free trade and arguments for protection > > Case for free trade > • Comparative advantage shows that trade benefits overall economy > • Some economists reserve support of free trade based on certain conditions > – Departure of actual markets from conditions of perfect competition > – Absence of any relation between higher income and higher welfare at national and international levels > > Protectionism > • Protection is a policy prescriptive to overcome the defects of imperfect competition in international markets > • Protection is oriented to favor particular industries > • The difference between interregional and international trade is politics > > Keep the money at home > • Domestic residents buy the imported goods > • The country gets the goods but the foreigner gets the money > • In domestic trade, the country gets the product and keeps the money > • Fallacious argument: > – Money and wealth are not synonymous > – Money is a means of exchange > – Money for imports must return to the country as payment for exports or as investment > • Foreign exchange redemption value only in country of issue > > Home market argument > • Domestic producer has a right to the domestic market > • Reducing or eliminating imports will lead to more goods produced at home, and more jobs will be created > • Problem: any shift from imports means a contraction of production for export > • Leads to a real decline in purchasing power > – Weakens the domestic economy > > Equalization-of-costs argument > • Use a so-called scientific basis for assigning tariffs to equalize cost structures between economies > • Recently presented as the “fairness” doctrine > • Problem of differing and constantly changing costs facing producers in different countries > – What costs are to form the frame of reference? > • This is an intractable solution, and carried to an extreme, would prohibit international trade > > Low-wage argument > • High-wage countries cannot trade with low-wage countries without risk of lowering their wages and decreasing their standard of living > • Alleged that a country can only lose when trading with a low-wage country > • Some domestic industries with relatively low productivity will feel wage pressures > – This is a signal for reallocation of labor and capital to different production regime based on comparative advantage > – Protection is not the answer for domestic industries facing pressures from sagging productivity gains > > Prevention-of-injury argument > • Willingness to lower and reduce tariffs so long as domestic industries are not harmed > • Appears reasonable and moderate > • However, related to the home market and equalization-of-costs arguments > • Likely to encourage the perpetuation of static and regressive industries > > Employment argument > • Use tariffs to limit imports during periods of higher unemployment > • Unemployment justifies import restrictions and the development of any domestic industry > • Questionable policy response to cyclical unemployment > – More problematic to use to remedy structural unemployment > > Antidumping argument > • Dumping of goods into import market at prices below prevailing prices in the exporting country > • Action required in predatory dumping > • Antidumping provisions are important aspects of trade agreements > • Governments will use antidumping policies just for protection > > Bargaining-and-retaliation argument > • Argument that it is ok to install protective barriers to trade for the benefit of a better bargaining position with other countries > • Free-trade (i.e., low-tariff) countries should adopt non-tariff protection for better bargaining position > • May have some political value, but has no economic validity > > Reciprocity argument > • Raise restrictions on trade with countries that refuse to lower their own protection barriers > • Sometimes presented as a policy in support of further free trade > • US, for example, seeks “reasonable” and “equal access” to foreign markets > • Problems of measuring policy goals and execution of this policy > > National security argument > • Nations need to limit dependence upon foreign sources for strategically important industries in the production of national defense > • Free trade does not mean a nation deny its ability to defend itself > > Infant industry argument > • Infant industries require some start-up time before they are swallowed by foreign competition > • Not all new industries require protection > • Risk that protections afforded these industries will persist > – Some mistakes are irreversible > • Woolen-worsted industry afforded protection in early years of US, still protected to this day > > Diversification argument > • Import protection to bring about export diversification > • Import protection to achieve diversification in the domestic economy > • Single commodity economies vulnerable to diversification problems > – Overspecialization > • Problems with this policy when principles of comparative advantage ignored > – Example of post-WWII Latin America > > Optimal tariffs and terms-of-trade argument > • Sophisticated argument for establishing tariff structure based on import demand elasticities > • Terms of trade: exporter is expected to absorb part of duty > – Extreme case where tariff-levying country is a monopsony > • Overall, difficult policy to enact, manage, and administer > • Raises prices for domestic producers at the cost of consumers > > The theory of second best > • Protection is a second-best policy because optimality of ideal free trade is unachievable > • Not an argument for protection per se > • Theory of second best says any policy that improves economic efficiency and reduces the margins of social cost to benefit is useful > – Regional trade arrangements and regional tariff reductions ---
**Author:** ![JayS](https://yyz2.discourse-cdn.com/flex034/user_avatar/forums.speedlife.net/jays/32/15375_2.png) [@JayS](https://forums.speedlife.net/u/JayS)\ **Post date:** [March 11, 2006, 3:25pm UTC](https://forums.speedlife.net/t/i-just-lost-my-largest-customer-to-china/9153/37 "2006-03-11T15:25:34Z")
There needs to be a huge mix of reforms to fix this issue. The problem is no one is willing to give an inch so nothing gets done. 1. Republicans are hell bent on free trade with everyone and no tariffs. 2. Democrats are hell bent on tariffs and no free trade. 3. Unions are hell bent on keeping their workers making 50k+ a year for factory jobs. 4. Consumers are hell bent on Walmart and it’s “do anything to get the lowest price” business model. Want a solution? You have to address ALL OF THOSE THINGS. 1. Free trade works, if it’s kept under control. 2. Tariffs work if you don’t force companies to just give up selling here (we’re not the superpower of buying that we used to be, and we become less every day). It doesn’t have to be taxed to the point it’s dollar for dollar equal, just enough so it’s not a no brainer for a company to outsource. 3. Unions have to go, or at least realize they will never make the money they did when we were one of two industrial countries on the planet, and the other one hated us way to much to trade with us. 4. Consumers have to give up their obsession with lowest price at any cost. My wife and I haven’t stepped foot in a Walmart or Sams Club for over 2 years. Sure, we pay a little bit more for stuff, but it’s higher quality and not feeding one of the biggest causes of outsourcing in this country. ---
**Author:** ![JoesTypeS](https://yyz2.discourse-cdn.com/flex034/user_avatar/forums.speedlife.net/joestypes/32/7190_2.png) [@JoesTypeS](https://forums.speedlife.net/u/JoesTypeS)\ **Post date:** [March 11, 2006, 3:55pm UTC](https://forums.speedlife.net/t/i-just-lost-my-largest-customer-to-china/9153/38 "2006-03-11T15:55:31Z")
> [@JayS](#): > > 1. Democrats are hell bent on tariffs and no free trade. > . O RLY? ---
**Author:** ![neurokinetik](https://yyz2.discourse-cdn.com/flex034/user_avatar/forums.speedlife.net/neurokinetik/32/7270_2.png) [@neurokinetik](https://forums.speedlife.net/u/neurokinetik)\ **Post date:** [March 11, 2006, 4:01pm UTC](https://forums.speedlife.net/t/i-just-lost-my-largest-customer-to-china/9153/39 "2006-03-11T16:01:03Z")
> [@dozr](#): > > In our business, we were facing a time last year where it looked like much of the IT work was going to be outsourced to India, much of it already was. > > To Quote the owner of our company: > > “There’s a big reversal in not sending things overseas and outsourcing, instead sending them to rural America to have them done,” he said. "In the IT world, Buffalo is considered rural America. When I think of “rural america” I think deep south… Could you imagine a help desk manned by rednecks instead of Indians? That would be good for a few laughs… ---
**Author:** ![Bacon](https://yyz2.discourse-cdn.com/flex034/user_avatar/forums.speedlife.net/bacon/32/7230_2.png) [@Bacon](https://forums.speedlife.net/u/Bacon)\ **Post date:** [March 11, 2006, 4:05pm UTC](https://forums.speedlife.net/t/i-just-lost-my-largest-customer-to-china/9153/40 "2006-03-11T16:05:19Z")
> [@neurokinetik](#): > > When I think of “rural america” I think deep south… > > Could you imagine a help desk manned by rednecks instead of Indians? That would be good for a few laughs… It’s called ClientLogic, in Winfield, Alabama. 🙂 [Previous page](https://forums.speedlife.net/t/i-just-lost-my-largest-customer-to-china/9153.md?page=1) [Next page](https://forums.speedlife.net/t/i-just-lost-my-largest-customer-to-china/9153.md?page=3)