Small and Medium Sized Manufacturers Face Import Competition

Import competition is a growing issue for American manufacturers, especially small and medium sized manufacturing firms.

Which countries pose the greatest competitive threat?

Here are some insights from a recent National Association of Manufacturers’ survey.

49.7% China
27.9% Mexico
21.8% Other Asian Countries
21.4% Canada
16.2% European Union
9.6% Other
7.8% Japan
3.3% Other Latin American Countries

Source: National Association of Manufacturers, 2003

Nearly one-half of SME's surveyed by NAM said that China was a growing import factor today, and this threat is expected to become even larger in the future. Mexico, ala NAFTA, is seen as a significant import threat as well.

Two types of SME manufacturers exist: 1) those producing proprietary products; and 2) those working at their customer specifications. While both are impacted by imports, those producing more commodity type products are the most susceptible at this point. Many suppliers to the automotive, machinery and other large equipment markets express concern that the "herd continues to thin at home" as more and more large cuctomers look to foreign suppliers.