Many US companies have partnered with a manufacturer or a distributor in China since the late 1980s. Many reasons have led to that decision:

• Cost of manufacturing
• Cost of raw material
• Cost of labor
• Relative ease in payment methods

In 2008, The U.S. imported $337.8 billion of Chinese goods, according the US Department of Commerce. India exported about $21 billion to the U.S. 

Trade disputes between the US and the two nations have risen since the beginning of 2012, and according to China's lead negotiator for a new global climate-protection treaty, Su Wei, potential import fees could prompt trade retaliation.

Outsourcing Issues:

Many opportunities are available for sourcing your materials and offshore manufacturing; however, greater chance of risk may also be a factor when sourcing in an unfamiliar territories.

Asia has been a great source for offshore manufacturing, but when sourcing for materials or manufacturing partner, you must be able to evaluate the following:

• Their financial standing
• Their QC process in place
• Their current client satisfaction rate 
• The quality of their final product vs. the US-made competition
• Their delivery time against your plan

Adding to the above issues, one must realize that lengthy transit time in the water, customs, duties, and taxes would reduce your profit margin while struggling to meet deadlines on production and/or clients' delivery time.

The Solution:

The hidden solution to all trade and sourcing issues is the North American Free Trade Agreement (NAFTA). It is a tool to help many US companies manufacture, import and trade with Canada and Mexico. 

Finding a partner in Canada or Mexico will secure many benefits to your business:

1. Providing a faster way of evaluating a partner by a short plane trip or communicating with the US embassy in Mexico or Canada for data on your prospects
2. Reducing your shipping cost for imported or exported goods
3. Increasing your profit margin by reducing or eliminating some duties and taxes
4. Improving delivery time by 90% in most cases
5. Providing an opportunity for reducing order to delivery cycle

Sourcing in Canada and Mexico proves to be a critical solution in the supply chain management plan. With heated trade disputes between the largest manufacturing countries, it is great to know that you have a friendly environment to source and partner with. 

NAFTA is a hidden opportunity for businesses; we need to take advantage of its benefits while providing prosperity for all three nations.