Product Genius, the Podcast for Inventors, Entrepreneurs, and Startups
Honest advice for inventors—with obscure cultural references included at no extra charge.
Episode
223
The Panda in the Room: Made in China or Made in the USA for Product Entrepreneurs?
Should inventors manufacture in China or the USA? Noah and Steven tackle the 8,000-pound panda in the room with a nuanced look at manufacturing an invention, especially when you’re launching at startup volumes. They explore why China can offer more than lower prices, how supplier coordination and small production runs complicate domestic manufacturing, why trusted factory relationships matter, and why “Made in USA” doesn’t automatically eliminate supply-chain risk. They also imagine a better American manufacturing ecosystem built around startup-friendly manufacturing incubators. If you’re deciding where to manufacture a new product, this episode will help you ask better questions before choosing a factory.
Core Topics for this episode:
- Manufacturing
- Supply Chain
Key Takeaways Include:
Listen here:
Episode Blog
The Panda in the Room: Should Inventors Manufacture in China or the USA?
Few topics in product development generate opinions as quickly as the words “Made in China.”
For inventor entrepreneurs, though, manufacturing decisions cannot be made with slogans. They have to be made with math, logistics, risk, volume, relationships, and a clear understanding of what a young product business actually needs.
In this episode of Product Genius, Noah McNeely and Steven Julian tackle the 8,000-pound panda in the room: why China remains part of the manufacturing conversation for so many new products, why domestic manufacturing can be surprisingly difficult at startup volumes, and what could make American manufacturing more accessible to inventors.
It is a nuanced subject—and that is exactly the point.
The Real Question Is Not “Can It Be Made Here?”
Almost any product can theoretically be manufactured in the United States.
The more useful question is:
Can it be manufactured here at the volume, cost, and level of coordination that the market—and a startup—can support?
That distinction matters.
A large established company may order hundreds of thousands or millions of units. A first-time inventor may need only 1,000 or 5,000 units to test the market.
To the inventor, 1,000 units can represent a major financial commitment.
To a busy domestic factory, that same order may be too small to justify the time required to quote, engineer, schedule, manage, and support it.
This does not mean American manufacturers are unwilling or incapable. It means the economics of small-volume production can work against the startup customer.
Manufacturing Is More Than Making One Part
Another challenge is that most products are not a single component.
Imagine a consumer product containing molded plastic, metal hardware, printed graphics, packaging, assembly, and perhaps electronics.
In the United States, an inventor may need to coordinate:
- A plastic injection molder
- A machine shop or metal fabricator
- An electronics supplier
- A packaging company
- A printer
- An assembly operation
- A fulfillment or logistics provider
Suddenly, the inventor is acting like the general contractor building a house—coordinating multiple specialized suppliers and making sure all the pieces arrive at the right place at the right time.
That can absolutely be done.
But it adds management, complexity, cost, and risk.
One reason established manufacturing relationships in China can be attractive is that a single factory or sourcing partner may coordinate much of that work. An inventor can receive a quote covering components, assembly, packaging, and sometimes even estimated freight to the United States.
For a small company with limited staff, that simplicity has real value.
Cheap Is Not the Only Advantage
The conventional explanation for manufacturing in China is lower labor cost.
That matters, but Noah argues that it is only part of the story.
For inventor entrepreneurs, accessibility may be just as important.
Factories accustomed to startup work may be willing to quote relatively small initial orders because their cost structure allows them to take more chances on young companies. They know some products will fail, some will remain small, and a few may grow into significant customers.
That ecosystem makes it easier for a new product company to get started.
This is why simply comparing the unit price of one molded component does not tell the whole story.
The inventor must also consider:
- Minimum order quantities
- Tooling costs
- Supplier coordination
- Engineering support
- Assembly
- Packaging
- Quality control
- Shipping
- Communication
- Lead time
- Scalability
- The amount of management required
The best manufacturing decision is the one that makes the overall business work—not necessarily the one with the lowest price printed on a quotation.
Relationships Matter More Than Marketplace Listings
Manufacturing overseas introduces real risks.
A factory can perform poorly. A supplier can misrepresent its capabilities. A middleman may pretend to have factory access that does not exist. Intellectual property concerns are legitimate. And pursuing a dispute across international borders can be difficult.
That is why Noah strongly distinguishes between established factory relationships and blindly requesting quotes from strangers online.
His approach is based on years of working with factories, learning their strengths, seeing their performance, and ending relationships when suppliers did not meet expectations.
A factory may say it can make almost anything.
That does not mean it should make your product.
Experienced sourcing involves understanding which factories are particularly strong in certain processes or product categories and matching the project to the right supplier.
For inventors without that experience, due diligence becomes especially important.
The goal is not “find a Chinese factory.”
The goal is “find a trustworthy manufacturing partner with the right capabilities.”
Domestic Manufacturing Does Not Automatically Eliminate Supply-Chain Risk
A common argument for domestic production is protection from geopolitical disruption.
That is understandable.
But a small inventor using a domestic factory may still be vulnerable during a major global supply-chain crisis.
Imagine a small American molding company producing 1,000 units per quarter for a startup. If imports from China suddenly stop, enormous established companies will immediately begin searching for domestic capacity.
Those companies may offer dramatically larger orders, better margins, long-term contracts, or even attempt to acquire suppliers outright.
The startup that thought it was protected because its product was “Made in USA” could suddenly find itself competing for capacity against companies ordering hundreds of thousands of parts.
Domestic sourcing can reduce certain risks, but it does not make a small company immune to global disruption.
Supply-chain resilience requires broader thinking.
Starting Overseas Does Not Mean Giving Up on American Manufacturing
One of the most important ideas in the episode is that manufacturing strategy does not have to be permanent.
An inventor may begin overseas because the product requires low-volume manufacturing, coordinated assembly, and startup-friendly economics.
If the business succeeds and volume grows, the economics can change.
At higher quantities, domestic manufacturers may become much more interested. Freight becomes a larger cost consideration. Automation may reduce the labor advantage overseas. Faster replenishment and shorter supply chains become more valuable.
The manufacturing strategy that makes sense at 1,000 units may not be the strategy that makes sense at 100,000.
Inventors should think in stages rather than treating the first factory as a lifetime commitment.
Could America Build Better Manufacturing On-Ramps?
The conversation eventually moves from individual product decisions to a broader question:
What would make domestic manufacturing easier for startups?
Noah proposes the idea of manufacturing incubators.
State and local governments already invest heavily in attracting large factories because those projects can create hundreds of jobs quickly.
That is valuable.
But large facilities also concentrate risk. If one major employer closes or relocates, hundreds of jobs can disappear at once.
A manufacturing incubator would take a different approach.
Imagine a district where startup companies could access:
- Injection molding
- Machining
- Metal fabrication
- Packaging
- Assembly
- Technical expertise
- Workforce training
These capabilities could be clustered geographically and structured to support smaller production runs.
Pair the incubator with a technical college or trade school and the model becomes even more interesting. Students gain hands-on manufacturing experience while local companies gain access to skilled workers and production resources.
Successful manufacturers could eventually “graduate” from the subsidized environment and establish independent facilities in the region.
Instead of recruiting one enormous employer, the community would be planting many smaller seeds.
Some would fail.
Some would remain small.
A few might become the next major local manufacturer.
Manufacturing Policy Should Include Startups
Government economic-development programs often focus on established companies because the results are immediate and visible.
A new automotive plant makes a great announcement.
A hundred tiny manufacturing startups do not create the same ribbon-cutting moment.
But small businesses can become important employers over time.
Helping product entrepreneurs manufacture their first 1,000 or 5,000 units could therefore be viewed as economic development—not merely assistance for inventors.
The challenge is designing programs around how startups actually grow.
Rigid requirements such as promising a specific number of jobs by a specific date may make sense for an established corporation but can be unrealistic for an early-stage company.
Manufacturing incubation would require patience, flexibility, business expertise, and acceptance that not every participant will succeed.
That sounds risky.
But entrepreneurship is inherently risky.
The goal is to create an environment where enough good companies can survive long enough to grow.
The Product Genius Take
“China or America?” is the wrong question if it is treated as an ideological test.
The better question is:
What manufacturing strategy gives this particular product the best realistic chance to reach the market, satisfy customers, survive financially, and grow?
For some products, the answer may be domestic manufacturing from day one.
For others, particularly complex products launching at low volume, overseas manufacturing may provide the practical on-ramp needed to establish the business.
Either way, do your due diligence. Work with reputable suppliers. Understand the entire supply chain rather than just the quoted unit price. And revisit the decision as your volumes and business change.
Successful product development is full of nuance.
Manufacturing is no exception.
And if you happen to operate a North American factory that loves small inventor-entrepreneur production runs, Noah would very much like to hear from you.
Or, read the full transcript here:
Steven Julian
It's time. It's time. Yeah, it's time to talk about the 8,000 pound panda in the room, bringing your product to market and having to deal with China. China. We're going to talk about it next. on Product Genius. Do you want to be a successful inventor entrepreneur struggling to get your product from idea to market? Well, you've come to the right place. Welcome to Product Genius. The down-to-earth podcast that explores important topics about inventing and launching new products. Noah McNeely is your trusted guide. With more than 20 years of product launch experience, he's here to help you on your journey to become a product genius.
Let's get started. Here's your slightly annoying co-host, Steven Julian. Hey, that's my line. Yes. Welcome to another hopefully award-winning edition of... Product Genius, I'm your slightly annoying co-host, Steven Julian. I have no idea why I'm talking so fast. Maybe because I want to get into the topic of this show. Sitting beside me is our intrepid producer, Jody Smith, sitting across the table from me inside of his lair. The warehouse next to his office here at Product Quick Start is the host of Product Genius, Mr. Noah McNeely. I don't know why I'm doing it like a sports commentator, but I've had a little bit more caffeine and I'm really excited.
Noah McNeely
Yeah, well, welcome back to the lair. There will be no wrestling here today.
Steven Julian
Okay. I'll get rid of my Michael Buffer voice.
Noah McNeely
I'll put it to you this way. If there's wrestling here today, this conversation has gone way off track.
Steven Julian
Correct. Correct. Correct. And I would be the referee anyway. There's not going to be wrestling. What there is going to be is controversy. Maybe that's why I was to potentially some controversy. That's why I was going to do the wrestling. So we are going to have a great conversation. What might potentially some people listening might think is a controversial conversation. Noah, as longtime listeners of this show, know you like to send out emails. Hey, here's what I'm thinking about talking about. And when I got this email about this show. I went, oh boy, here we go.
This is going to be good. And everything reminds me of a reference. So I was thinking of Laurel and Hardy. Here's another fine mess you've gotten us into, Mr. McNeely. I thought you. brought up Scooby-Doo or Shaggy. Zoinks, we're going to talk about this topic. And I was thinking of Honeymooners, Bang Zoom to the Moon. I mean, this is... And there's probably a couple of phrases with curse words that we're not going to say on the air. This could be a topic where, and I think you said it in the notes, you might even get some hate mail on this.
Noah McNeely
Yeah, if we ever do a show that will lead to hate mail, this is probably it, unless we come up with something even more controversial in the future.
Steven Julian
So we're going to talk about China. That was my best Trump voice.
Noah McNeely
So one of the working titles I have for this is The Panda in the Room.
Steven Julian
Rather than the elephant in the room.
Noah McNeely
Oh, I wrote it as elephant in the room and I was like, huh, Panda's more fun.
Steven Julian
Yeah, Panda is more fun. So we're going to talk about China and the fact that the reality is if you are an inventor entrepreneur and you are producing a product to be brought to market, China almost has to be part of the conversation and has. been part of the conversation for the last 20 years at least.
Noah McNeely
Absolutely. And it doesn't necessarily have to be the end of the conversation, but it's something that almost all. Especially inventor entrepreneurs do generally look at for a variety of reasons. And before we get too deep.
Steven Julian
I was going to say, yeah, yeah. Let me, let me do the slightly annoying co-host job.
Noah McNeely
I feel like I'm being.
Steven Julian
We need to lay some ground rules.
Noah McNeely
Yeah. For legal reasons or something. I feel like you're looking at me with that.
Steven Julian
Yeah. Yeah. Oh boy. That was good. Yeah. So we need to, I want to lay down some ground rules and I think there are some kind of precursors that I know you wanted to say. And I might even have a couple of my own. So there were some things you wanted to just kind of make sure and say right at the start.
Noah McNeely
Well, first, the opinions expressed on this program do not necessarily reflect the opinions of Spotify, iHeartRadio, or any other podcasting platform. Second, let me be clear. I'm a patriot. I love my country. I was born here in the U.S. and. the South. And if every product I designed could be produced here and manufactured here, I'd be very happy with that. So that's one thing, even though I do a lot of business in China, which we'll talk about. The other thing I want to make sure is clear is there's a very big difference between China, the country, and the people of China.
And I work with some fantastic people in China that, just like you and me, they just want a better life for their children and a better life for themselves, just like anyone anywhere. I worked with people and shared in their joys. They brought new children into the world and got married and done all the things that people here do. So I think it's really important. I think this gets lost sometimes in the political conversations that China, the country, and China, the people are two very different things.
Steven Julian
So I'm going to add my nuance to this conversation, which is the word nuance. I would like... As we talk about this, I want everybody to remember that if you've listened to this show or if you are in the process or have brought. a product to market, the word nuance is part of the journey. Noah has sat here for how many episodes and talked about twists and turns and little adjustments and things we need to... You know, well, we could do it. There's all. you could do it like that, but then it won't actually work.
You have to do this. You have to change that. Bringing a product to market, you have to have a lot of nuance. You have to be willing to adjust. You have to be willing to change your expectations. There are so many different titles of so many different shows that I want you guys to remember. First of all, go back and listen to all those shows after you listen to this one. But then I want you to think about the fact that we are going to have a nuanced conversation. About real people, about real politics and real countries and how it all plays into what you are trying to do in bringing your product to market and how you need to be willing to be nuanced in the midst of that.
That was the main thing I wanted to bring up. and just kind of talk about. I guess where the conversation starts is the reality, Noah, and it's not anything new. It's been around for, again, at least about 20 years. A lot of the factory work and creation of a lot of products, including things like the iPhone that people have and are listening to this podcast on Apple Podcasts, a lot of products have been made in China. So where are we at today? Because you hear some people, oh, manufacturing is starting to come back.
When it comes to making products, where are we at today? Is it shifting at all? or is it, okay, yeah, it's starting to shift, but still a vast majority of what's being made is being made in China.
Noah McNeely
I would say still a vast majority is made in China. There are certainly some movements and currents toward doing more domestically. You know, bigger companies especially, but it's not quite the same for inventor entrepreneurs in general. Now, there's an exception to every rule. There always is. But I still find it very, very difficult to put a supply chain together domestically for a small client that's just getting started. I mean, the truth of the matter is, not every product can be made in the United States. And this is the point where people make shocking sounds.
Why would he say that? Well, it's not a complete statement. That's not an entirely true statement. I think the more complete version of that is not every product can be made here in a volume and at a cost level that the market will support. And this, again, is especially true for inventors or entrepreneurs.
Steven Julian
The reality is anything could be made here if price were not an issue, if volume were not an issue. If other orders from other people were not an issue, I mean, it could be made here, but you're dealing with, it's a different style of manufacturing here. So if I'm a new, if I'm doing a product and I'm doing 25,000, 50,000, 100,000 units, I'm doing what's considered a quote-unquote small run.
Noah McNeely
So, yes, but even those, that's not even really what I'm talking about. I'm talking about even earlier than that as an entrepreneur, maybe you're trying to do 1,000 units. Maybe you're trying to do 5,000. 25,000, 50,000, that does get into an area where. it's a little bit easier to do domestically. You know, if you come in and an inventor down the street from me and I'm a molding company and they need a thousand of something. Yeah, they'll probably do it. They'll probably quote it for you. But that's really, you're not creating any jobs in that factory for that.
Steven Julian
Yeah. Talk about the difference and maybe put it in practical. I'm asking you to put it in practical terms in terms of the fact that the wide spectrum of what a product may look like. I'm sitting here thinking. A friend of show and sponsor still of this program, Tiffany Crumans of Opu Probiotics posted online about her. part of her journey was finding packaging, you know, that was made here in the United States. And you can go read about her story and her journey of finding that versus part of it. is you got to get things done for you as the person helping develop the product.
What's the difference? Supposing you even could find someone here, like you said, oh, I could do that molding, but talk about how much difference of a process it is using your. contacts in China.
Noah McNeely
Yeah, I think Tiffany's a good example of this. Now, her product, Opu Probiotics, does make a lot of sense to make here. It's a consumable, it's a food product, and that's not really what we're talking about here. But the story she has with finding the packaging, that was a journey into and of itself. People think about, okay, China's cheaper. Yes, but there's also another element that's important for the inventor or entrepreneur, and that is it's easier. So here in the U.S., let's say you had a product that you're coming to the market with.
It's got some plastic. It's got some metal pieces. It's all got to be assembled together. It's got to go in a box.
Steven Julian
Dare we mention a past product of this past fictitious product?
Noah McNeely
We have received a cease and desist letter from Frank, so please don't bring up Frank's cheese hamburgers in any negative way. Sorry, Frank.
Steven Julian
Sorry, I apologize. And I didn't mean to get you off track. I thought that was a wonderful – I didn't know we had received that cease and desist.
Noah McNeely
So Frank's levitating cheese hammer, that would be a really good example. here.
Steven Julian
Available now for a holiday show.
Noah McNeely
So if you've got all these different processes, in the U.S., you almost end up playing or hiring somebody to play the role of general contractor. As though if you were building a house, you – As an individual, you could go out and you could hire the electrician. You could hire someone to pour the foundation. You could hire someone to put up the walls and the roof. And you end up hiring 30 different people. You can manage all that. And that's kind of what small volume manufacturing in the U.S. becomes. Unless it's just a single piece of plastic.
Well, yeah, then you're only hiring one person and somebody to make a box. That's different. But if you have a product that's got multiple parts, multiple processes, assembly. You end up having to go find a plastics person or plastics molder. You end up having to go find a metal shop. You end up having to go find someone to make the box. And Tiffany experienced some of this with her, you know, just trying to get a box. Yeah, exactly. Whereas in China and in other areas in East Asia, but mostly China, I can send two emails and two factories I trust and have history with not to Alibaba.
We've talked about that. Don't go there. It's dangerous. But two factors I trust, I can send two emails and I'll get a quote back on within just a few days. on the full thing. The whole product, it'll be to make the product, assemble the product, put it in a box, print the box, and it's on a pallet and they can even estimate what it's going to cost to ship it to wherever in the United States I want to have it shipped. So it's a much easier thing to do for, and that's for small volume.
That's like a thousand units even. So it's much easier to find factories that are willing to do that in small volume and take over the whole thing. Not that it can't be done. And again, there are exceptions. And frankly, if you are listening to this and you own a factory in the US or Canada or that would love to do this for small volume for inventor entrepreneurs and take over the whole thing and maybe you won't. be as cheap as China, but that's okay because you can solve one of these other problems and that's the make it easy thing.
Call me. I have been looking for you for a long time. So please, please call me if that's something you want to do.
Steven Julian
So I'm going to, I'm going to reset here a little bit. And this is partially showing my slightly annoyingness and also my throwing up my hand and going, okay, I've never gone through this process. So I'm asking you to, I want to stop and just kind of camp here for just a second. for those who are new to the process or dumb like me, I guess I'll say. So welcome to the club. I welcome you in with open arms. You would get hate mail on this topic is because of people who've had experiences of going through companies like Alibaba and getting burned.
You pointed out one very important thing. You have developed a fantastic relationship and done the due diligence because you've been there. You know the people. You've seen the process work. Just unpack that a little bit because when you're talking about this. And saying, we got to talk about the panda in the room. We're not talking about all of it. Again, here it comes down to people. You found some trustworthy companies, trustworthy factories to work with.
Noah McNeely
Yeah. So there's two reasons I think we might get hate mail. One is people that have had bad experiences in China because, you know, it's a billion people. They're not all good people. There's some bad people there too, you know, believe it or not, you know, a billion people. statistically, there's a lot of bad people and a lot of good people there. You know, it's kind of like don't take candy from strangers. Don't take production quotes from strangers. You might get a good one. You might get a bad one. You might get a quote from somebody who has no connection with the factory at all. that's just trying to, you know, get your money out of it.
Steven Julian
Scam your money, yeah.
Noah McNeely
And you have very little recourse, you know, through legal systems and otherwise if that happens to you overseas like that. Not just China, but in a lot of countries overseas if you have a problem like that. Excuse me. Doing the due diligence, taking the time to find legit factories, factories that have a track record of success. And these are relationships that took me years to build. And I fired some factories over the course of my career. And over time, you start to learn, or I started to learn, okay, this is a group of factories that are really good for this category of products, and they always do good work.
This is a group that does this kind of product, and they always do good work. One of the issues you do kind of run into in, I think, Asia, probably in a lot of places, is factories will want to quote on something, even if it's not in their sweet spot. So that's sort of the nuance of building these relationships is understanding, okay, I know you can do it all. But really, this is the core of what you're great at. And that varies from factory to factory. And this is a total tangent.
Steven Julian
But I think that tangent leads to the other side of where I wanted to camp out for just a second, which is, and I don't want to gloss over. that. Noah McNeely of Product Quickstart and the host of Product Genius is on the hunt for a factory on the North American continent that would... Potentially have the ability and be interested in doing small runs or a lot of turnaround with or helping new products get to market.
Noah McNeely
Multiple factories. I'd love to meet a lot of you.
Steven Julian
Yeah.
Noah McNeely
Now, this is the other reason I think we'll get hate mail is from people that's like, I own a factory and I can do this. This guy's nuts.
Steven Julian
So why are they not?
Noah McNeely
Don't hate me. Just reach me.
Steven Julian
Right, right. Reach out to me. Let's talk about it because you know the process. So why is it that you haven't been able to find what are without, and again, because there's nuance, there's probably a million reasons, but what are some of the top two or three reasons why North American factories do not do this type of work?
Noah McNeely
In your opinion. Again, just based on my experience, I think there are a few reasons. How can I be delicate about this? A lot of inventors are not business savvy and maybe they don't work through someone. like me or someone that understands the industry. They just go straight to that molder or whatever and they want to take up a lot of that person's time and they become a nuisance. They're doing what they think they're supposed to do as a customer. You go into this. And you want to make $1,000 to start.
And that's a huge, again, that's more of a nuisance level for most of the domestic factories I've run into. Now, if you go in and you're like, all right, I'm an inventor, but I've got some financial backing. We want to make $20,000 of these out of the gate. Well, that's a different conversation and less of a nuisance. And especially if you can convince that factory owner, well, there's a, you know, we're starting at $20,000. We may be $80,000 in a few months. $300,000 a year. And then if they see a growth path there, the problem is a lot of these factors have spent so much time. or maybe earlier on, they talked to inventors that just took too much of their time, never got anywhere or made that first run.
And then that was it. And they're. doing, you know, they're just doing that, the cost reward analysis of that relationship with you.
Steven Julian
So let's now we can, I'd like to pivot to a couple of maybe comments or questions that you've heard. Right. As you've worked with people. But I want to create American jobs. Yes. I didn't mean to do it in an irritating voice. I apologize. But I want to create American jobs. What?
Noah McNeely
That's your normal voice.
Steven Julian
Yes. Yes. This is my podcast host voice.
Noah McNeely
So my comment there is, I get you. And I do too. But making 1,000 units is not going to create any American jobs. And if you start your company and the cost is so high that you cannot, your company doesn't get off the ground, you have made exactly zero American jobs and you will make exactly zero American jobs.
Steven Julian
But about going to China, I'm worried that there's going to be conflict or the geopolitical problem or war or zombies that will disrupt the China supply chain.
Noah McNeely
Right. So let's say you do find... A domestic factory that's willing to take you on in small volume and grow with you. You know, that does happen. The. point of this is not that it could never happen. The point is it's very hard to make it happen. Let's say you do that and you're like, all right, if there's something happens, we have a trade embargo with China, you know, zombie stakeholder China, whatever it is, and there's no trade with China or very limited trade with China. I'll be safe. You know, I've got my, you know, let's say Frank has diversified his business.
Steven Julian
Whoa, whoa, whoa. Cease and desist from Frank.
Noah McNeely
Let's say Frank's. Brother, uh, Fred, Hank, Hank, Hank has, uh, opened a new, you know, he's gotten some investment from his brother and he's opened a business in East Bumble, greater East Bumble, Missouri. And it's, he's bought a couple of molding machines and he's going in the manufacturing business, small volume. And he's like, all right. So you're like, all right, I know Hank and Hank's going to take good care of me. I got my contract with Hank. We're going to make a thousand units a quarter with, with Hank. And that's going well.
So I'm protected from any disruptions with China. Okay. So now let's back out a little bit. Let's say there is some sort of global trade disruption with China. What do you think happens to Hank's factory the next day or the next week? Well, a couple of things. One, Hank's going to start getting a lot of calls from people that make product for Walmart and other places, people that make a lot more product than you do. They're going to say, you know, we've got this supply chain issue. We want you to make our product for us.
And we make these plastic coat hangers. How many of those could you make? And Hank's like, well, you know, we're a small company. I could probably make $300,000 a month if I work 24-7. Okay, that doesn't fulfill our need, but that helps. So we want to hire you. But then Hank says, well, wait, I've got these other customers and stuff that I have a contract with. So, you know, giant coat hanger company says, okay, we'll buy out their contracts. And Hank said, well, I don't really feel comfortable doing that. So, Hank, here's a check for $11 million.
We just want to buy your factory. Even still, you're not going to be protected. from that because something like that's going to be a global disruption and the players with bigger money and bigger lawyers and bigger ambitions and bigger customers are going to take over as much of the capacity as they can right away. Now, you might find that rare person, maybe Hank's that rare person that will turn down $11 million and you might get lucky there. Most of the Hanks are not going to do that.
Steven Julian
Well, if that happens, Hank needs to become your pastor of your local church, I think, at that point. By the way, I recognize—I'd like to apologize to Noah. officially on the record—I went rhyming. You went alliterative. I do recognize Fred is alliterative with Frank. I chose Hank as a rhyming. I guess I—I don't know. Yours was fine. I kind of jumped on you.
Noah McNeely
Please tune into our other podcast on Wordplay at the time.
Steven Julian
And our— And our relational therapy that we do with Jody, our producer. Okay. And then the last one you already kind of talked about, I guess another question that happens is, oh, the Chinese are going to steal my idea. They steal all the IP.
Noah McNeely
Yeah, we've had an episode on this, or maybe it was one of the flashes of genius. But again, go with reputable factors, factors you have a relationship with. Stay away from Alibaba. Don't take quotes from strangers. Yeah.
Steven Julian
Okay. So. So that's kind of talking about the Chinese side of things or just the day-to-day operation, if you will, of getting your product to market. We are not a political show, but this is a topic that has a political aspect to it. So I love the way you phrased this in our pre-show note where every... There was an old TV show. So again, a reference, Queen for a Day, where they would take a studio contestant and make her queen for a day. And they always gave her a dishwasher. But anyway, that was the 50s.
Noah McNeely
What kind of queen wants a dish? Exactly.
Steven Julian
You want your dishes done for you.
Noah McNeely
What country are you a queen of? Yeah, exactly.
Steven Julian
Exactly. So you talked about If I Were King for a Day, which I believe there's a song. I will not sing it. But if you were king for a day or, you know. Yeah, let's keep it. with King. Let's keep it with benevolent monarchy.
Noah McNeely
Yes.
Steven Julian
And you could just make things happen. Yes. What would you do?
Noah McNeely
Well, first, I'm going to give a teaser for it.
Steven Julian
And specifically in terms of this topic.
Noah McNeely
I'm King for the day.
Steven Julian
Oh, sorry. I'll shut up. I apologize.
Noah McNeely
But first, before we go into that, I do want to give a teaser for our next Flash of Genius, and that's people that listen to all the things we just said and say, okay, well, what do I do then? We're going to talk about that in the Flash of Genius. How do you? Manufacturing the U.S.? How do you get to that point?
Steven Julian
You sure you're going to be able to cover that in five minutes?
Noah McNeely
We may have to do another teaser. Might be a series of teasers.
Steven Julian
A serial, as it were. Now, all of a sudden, I'm playing the old Superman.
Noah McNeely
We're going to cover one possible route. That's what we're going to do. Okay. So again, at the risk of this becoming a political show, which is not, you know, I've given, having been in this industry a long time and certainly wanting to. do more and more business and diversify where we do business, even whether it's domestically or otherwise, I've given a lot of thought about this, about what governments could do. And I know, you know, governing is much more complicated than just being king of a day and waving, king for a day and waving a magic wand.
But if I could do those things. Here's what I'd look at. On the federal level, I think it would be a good idea, a very good idea for the Department of Commerce or whoever, you know, I don't know who's responsible for this kind of stuff, but whoever would be responsible to look at trying to create other Chinas in other countries. So in other words, places where small businesses can get started and grow and then, you know. Bring that value to the U.S. eventually. So looking at places like Brazil or Chile or Latin America, East Africa.
I actually do business. I actually have a company I do business with in Kenya. It's a great little company. They manufacture some stuff for one of my clients. So there are places like that that are starting to pop up organically, but with some backing and support from government interests in the United States. I think we could grow that. And I think that would be good. For the U.S. and globally.
Steven Julian
In some respects, that is already happening. I know Vietnam, at least in terms of clothing and a couple other industries, has become a pretty big player.
Noah McNeely
It's happening for big businesses, but I don't see it happening in a way that helps small businesses get started.
Steven Julian
And the one thing you haven't said, and even in this, so I'm going to... I'm going to really drill you on this one or ask you a tough question on this one. Because when you talk about if you were king for a day and you would have other countries, one of the biggest reasons why these countries would be more conducive to helping with smaller orders, new orders, bringing a new product to market is because of the cost of labor is one of the biggest ones. I mean, that's it. That's part of what has to go.
And the cost of running the factory itself because of government, there's less regulation. Less regulation, lower labor costs. That gets factored. in.
Noah McNeely
And when those things are lower costs, it's less of a risk for factories to take on small work and to take that dice roll with you in the hopes that you grow. It's much less of a risk for... That factory to take six swings on small clients with the expectation that one's going to become big. That math still works out for them, which is something that China has kind of done well, is they've sort of mastered that. And they recognize that some of the startups are never going to be that big, but that's okay.
Steven Julian
Nuance. Okay. Back to being king, and thank you for not getting rid of your jester. No. Yet to this point. So go on. I know, I'm walking the line.
Noah McNeely
You are a permanent member of the court. State and local governments. So, you know, most states and big local governments like the county where we're in now, which is as big as a state, frankly, population-wise, they will often have departments or organizations that their mission is to bring manufacturing jobs or other jobs or basically grow the commercial interests in that state. Now, what I've seen is they. do a great job on things like here in Georgia bringing the Caterpillar factory here, which creates a bunch of jobs, and then the Rivian factory and things like that.
And those are all fantastic things to do. That's all good stuff, all great stuff. I don't want to take away from that. However, what I do see lacking is what I would call manufacturing incubation. So I don't see a whole lot of... There's pathways for small businesses to get started in the state and grow and manufacturing businesses to start in the state and grow. And again, some of those will become bigger businesses. Now, I don't know how you'd structure this. I'm not actually in politics, but what I would love to see is states and governments create these sort of manufacturing, small manufacturing zones.
Maybe you put them in places that need more jobs and you don't. You subsidize that to a point where you're not going to compete with China on price, but at least you subsidize to the point where it becomes that easy place to go. And maybe it's all on the same street. I can get my parts, my plastic parts molded, my metal parts made. I can get my box done, et cetera. And the goal there being to get these companies started to where they can graduate out and maybe they build their own factory or whatever in your state somewhere.
And I think that's... If I could do something, that's what I would do. I think that the great thing about a Caterpillar or a Rivian coming to the state, that's going to be a lot of jobs right away, a lot of investment right away. But what happens when that factory closes? All those jobs go away all at once, right? So that's a problem. You see that in the Midwest and other places. As industries move or they decline, that happens, and it's a really big hit at one time. Small businesses and getting small manufacturers going, that's more of a diversification type play.
You're in finance. You get it. Where if one of those goes away, okay, maybe we've lost 15 jobs, but those 15 people can go work somewhere else. Caterpillar goes away. Caterpillar's not in trouble. They're great. Caterpillar, don't send any letters. If Caterpillar goes away or moves to their factory, that's hundreds. of jobs that disappear overnight.
Steven Julian
Yeah. And you kind of had in your note here, there are politicians smarter than you and I that can work on this. But I'm sitting here thinking that why not also open – if the government wanted to get involved, they could get involved rather than building the next big edifice of some city thing downtown. Why not have the government kind of runs the – like they own the incubator, they own the space, or they're at least involved in it. Why not also get involved on an educational side of students who might want to get involved using their hands, learning a trade?
Noah McNeely
Imagine a scenario where you have a technical school, technical college, and maybe you have an opportunity zone, which those exist in lots of places, and you add to that a manufacturing incubation. Park or whatever you'd want to call it. I think that the synergy of that, you would see dynamic improvements across a lot of different areas. First, those students learn the trade. They learn how to be a molder. They learn how to do machining. They learn how to do all these things that can apply. in all sorts of ways. And the community has improvements because you have jobs there that will grow.
And you've helped the inventor entrepreneur community start businesses, grow those businesses, which creates even more jobs. Now, I think there's just, excuse me, that's a hard word to say, a statistic that most of the jobs in the United States are created by small businesses. I think this would recognize and capitalize on that.
Steven Julian
How do we make it happen? Yeah, so obviously, well, my, okay, sorry, my first opinion, and I said obviously, but the first thing that goes to my mind of, Why is this not happening yet through political systems is because at this point we can't even agree what two plus two equals in a political system without everybody taking sides and blaming the other side for all of the problems.
Noah McNeely
It's five if you believe it's five.
Steven Julian
What a great opportunity to work together. What a great opportunity for government, business, and small inventor entrepreneurs. To kind of find common ground.
Noah McNeely
I mean, I don't see why. Anyone politically would oppose something like this. I mean, it's bipartisan.
Steven Julian
It's a long-term investment. That's the big thing.
Noah McNeely
It's not as flashy as saying, hey, I brought a Hyundai. Exactly.
Steven Julian
And it's obvious why. the Caterpillar, the Hyundai, the Rivian, oh, these are big things, big jobs. I mean, remember a few years ago, the whole Amazon was going to relocate. I mean, it was a joke how everybody was drooling over themselves to get Amazon to come here or to come wherever they went. And instead, it's not as sexy and flashy to do small things, but that's where the percentages are.
Noah McNeely
And the big companies, having them come in, that's a great thing. But it's, you know, I'm more of an all the above kind of guy. I think you, again, I'm a big fan of diversifying. Not even talking about inventions, but diversifying the economy of your state or your county.
Steven Julian
Well, and I love it. And so when we kind of get to the bottom line of this, you know, I think. So you're going to talk about how if you got to start in China, that doesn't mean you have to stay in China, right?
Noah McNeely
Well, why not bring- You're getting into the Flash of Genius now.
Steven Julian
Oh, sorry. Ah, so we'll save. that for the Flash of Genius. But let's reword it as if you were king for a day, why not? And you kind of made a little point here of if the manufacturers were to be willing to start in these manufacturing incubators. That the government subsidized or had some control over as long as they can graduate out of it, but as long as they stay in the state for a certain period of time, they get the….
Noah McNeely
Yeah, I mean, let the politicians work out… All the kickbacks. The problem with that is they work out stipulations which don't make any sense. So, you know, you should have a business guy help you work out those stipulations. Yes.
Steven Julian
To be efficient and effective.
Noah McNeely
There's an entrepreneur center here in Georgia and their whole thing is I must create exactly this many jobs by such and such. Well, yeah. Okay. That's a great goal, but maybe that's not right for every single business.
Steven Julian
Yeah, exactly. All right. So I get off the soapbox. No, no, that's okay. So I think this has been a very important soapbox and I think this has been a great topic and one we. could continue to talk about. I'm thinking it's one of those topics that everybody listening has got some thoughts, got some feelings. I want to give one challenge, and then I'm going to get out of your way and see if there's anything you want to say to kind of wrap everything up. Because we have always said the audience of this show is inventors, entrepreneurs, people who want to bring their product to market.
This is one of those shows where if you're listening to this, do you have a friend who's involved in local politics? Do you know someone who is involved in manufacturing? This is one of those topics, and this is one of those conversations we want to invite other people into and listen. And knowing that I know everything you've said, the little things I've added, and the things Jody has thought while he's sitting over there in the producer's chair, people are going to have different opinions. People are going to have different, and that's okay.
It's okay. It's nuanced.
Noah McNeely
All I can do is look at things through the lens of my experience. And that's what this was all about. Other people have. other lenses and other experiences, but we can learn from each other and come up with better solutions, I think, for everybody.
Steven Julian
That's it. I think the idea is better solutions. So any last, you know, so we are saving something for the flash. I was going to bring it here at the end, but yeah, I like that idea. Maybe a serialization of a flash of genius, but. That is the worst ending question that any co-host can ever ask.
Noah McNeely
What else do you want to say? Anything else you want to add? Well, I'll just sum up. I'm a patriot. I love America. Chinese people are great. They're not the same as the country. I think there's stuff that the governments could do, local and federal governments could do to actually help start small businesses, which is going to just pay massive dividends over time.
Steven Julian
A thousand points of light.
Noah McNeely
Sorry. Oh, don't go there.
Steven Julian
So I think there's, yeah. So I appreciate you bringing this. If you have any hate mail, you can go to productquickstart.com. And instead of saying, I have a product for an idea, call me. You can then rant all you want. And. we might even read it on the air. We might even give you your own flash of genius. If you have something informing to say, if you have a nuanced opinion that you'd certainly want to express, please feel free to do that. I mean, this is an open forum and we want to hear from you.
Even if we don't agree with you or even if we have a different opinion, that's okay. Again, I think we need more of that, of just saying it's okay to have a different opinion. And it doesn't mean I hate you. And hopefully not vice versa. So how do we work together? Is there common ground to find?
Noah McNeely
If you listen to the last episode about brainstorming, if nobody had differing opinions, all products would suck. Most products.
Steven Julian
That is the way to end the show. That is the way to end the show. So for our producer, Jody Smith, and for he who helps your product not suck, Noah McNeely. This is your Slightly Knowing co-host Steven Julian saying, I bet you can't wait for the next Flash of Genius where we dig into this a little more and maybe it'll. be 17 different Flashes of Genius. Who knows? But what I do know is we will catch you next time on Product Genius.