I just returned from a sourcing trip to Vietnam. I have been sourcing sustainable product in Asia for 15 years. I have been travelling to Asia for 35 years. I feel like I have seen China, in particular, grow up. I have very mixed feelings about manufacturing overseas and its sustainability.
The first time I went to China was in 1982. I was 5 years old at the time, part of a youth choir—singing and dancing group, invited to perform in Hong Kong and Mainland China. I went back in 1986 and 1991 for the same reason and then, at 19 years old, I lived for 2 years in Taiwan as a missionary for my church where I became totally fluent in Mandarin Chinese. In the year 2000 I lived in Shanghai for a year working as a management training consultant travelling all over China delivering courses to Chinese executives of Fortune 500 companies. I have a lot of love for China and have learned a lot about it and its people over these many years.
In 2001 I began manufacturing Lovesac covers in China and filling them in the United States. Sustainable manufacturing wasn’t even a topic then. Even to this day all naked Lovesacs are made in the USA, but we still sew most of the covers and also build most of our Sactionals in China. We are currently working on re-sourcing our Outdoor Sactionals to Vietnam where labor rates are more competitive. Chinese costs continue to rise as their population becomes more wealthy—mostly due to all of the money we Americans send that direction by providing all of this work so we can buy lots of stuff inexpensively. The younger generations in China, smartphone in-hand, are not keen to work factory jobs like their parents. Still, there are a lot of Chinese who need work.
The truth is: the current practice of western countries (especially the US and Europe) utilizing developing countries to manufacture items inexpensively is simply not a sustainable endeavor. When I was a child, nearly every toy I owned had a little gold “Taiwan” sticker on it. Then, as the Taiwanese factory owners and workers got wealthier, the labor-intensive jobs moved to China. The same thing is happening there right now, as we chase cheaper labor to Vietnam…and onward.
Many people presume this kind of business is outright exploitative and “wrong.” Most of those people, however, are wearing clothes or using 100 household products all made in China or the like and refuse to pay more—or just buy less. While there certainly are “sweatshop” operations and poor factory conditions to be found, I can tell you that nearly all of factories we work with to make Lovesac product are actually nicer condition-wise, than most of the factories we work with in the United States. And while labor in these countries is by far cheaper than in the US, the wages our workers make double or triple the wages they can make back on the farm or in the villages they may hail from…and they are happy to have well-paying, sustainable and reliable jobs, good living quarters, meals, and overall better working conditions than they might have back in their home villages.
But again, year by year, as wages inevitably increase and as even the most unskilled of laborers, now living above a subsistence income, affords a smartphone with access to view everything from Alibaba.com to Kim Kardashian and her lifestyle, their desire to do repetitive or labor intensive work diminishes with each passing year. This is totally understandable…and for this reason, along with many others, this entire paradigm is simply unsustainable. For one of the earliest defining documents on this, checkout the famous Brundtland Report.
So while our Lovesac business is still (relatively) small, and we are fighting for every margin dollar we can just to eek out a profit, we will continue to seek the best prices to manufacture our well-made products that I am often told by friends are already too expensive for many to afford. If we want to survive as a business, competing with so many other inexpensive products, we honestly have no choice in the matter. We must compete in this way. But I very much believe that this unsustainable paradigm that American consumers have become accustomed to is doomed to change and I hope to be on the leading edge of that curve. Ultimately, the problem comes down to transport. Transporting anything, from raw goods to finished product, creates more carbon emissions and waste than necessary–it is simply not as sustainable as local manufacturing and local delivery.
While there are certainly other places on the globe that need the same income and subsequent modernization that comes from the manufacturing of goods for the western world, not all countries, cultures and infrastructures are created equal. Many will not be up for the task, and to be honest, I hope that many countries will not rise to the occasion and facilitate this practice. With so much access to media, cheap electronics, and every other kind of product now available to those even in the developing world, the willingness of people to do manual labor for very low rates is evaporating quickly….but as long as people struggle to put food on the table, it will be very difficult for entrepreneurs, businesses, even entire cultures to say no.
I predict that someday—in my lifetime—most products including Lovesac’s will be made in a more sustainable way, more locally throughout the world closer to where it is to be consumed. There will be less shipping, less carbon wasted, and this massive-scale globalized manufacturing infrastructure (all of the ships, the trucks, the massive facilities, etc) will all become defunct. What has consolidated will fragment again, even as we are now seeing so many massive industries fragment before our eyes as their business models are disrupted by smaller challengers in their categories mostly with digital business models (like the music, publishing, mattress, shaving, and even fashion-retailing industries are facing). What is happening on the front-end (to sales and marketing behemoths) must also happen on the back-end (to manufacturing and distribution industries).
Globalization through trade and other means will still become even more severe. The world will become even more homogenized and generic. But not just through products and services but through business models as well. We will shift to smaller-scale manufacturing with machinery and expertise democratized throughout the world. BUT, and this is the big but: Everything we buy, including Lovesacs, will cost a lot more. That is our future…and I’m okay with it. In the mean time, we’ll have to slowly wean ourselves off of the industrial complex we have built—and it won’t be easy. People have grown to like lots of stuff—cheap.
How do you think overseas manufacturing will change in our lifetime?