Made in France – A Manufacturing Renaissance
By Bruno Racault, President and CEO of ALL Circuits
2020 has been a really tough year in France, and indeed throughout Europe. Leaving aside the ongoing human tragedy, we had to be innovative and creative to continue our work as we managed supply disruptions, working conditions and, of course, a roller coaster of demand. But the year has ended well for ALL Circuits with several major new contracts that will allow us to continue to grow and digitally transform our factories.
Many of the dynamics of 2020 have led brands to think long and hard about where they make their products and we’re happy that France will likely end up winning more business as a result. I believe this trend combined with a focus on digital transformation, Industry 4.0 and automation, will lead to a renaissance of European manufacturing, particularly in France and Germany, two countries committed to becoming the smartest manufacturing region in the world.
And our customers are innovating too. Many in the automotive sector, where we are very active, are working hard to create new mobility solutions related to autonomous and electric vehicles. France has been the second largest innovation nation, after the US, at CES’s Eureka Park and we’re happy to be supporting those innovative startups and helping them bring their products to market worldwide.
What’s Driving The French Manufacturing Renaissance?
Driver #1 – Think Global, Make Local
The pandemic has caused brands to reconsider where things are made. The initial disruption in China, and elsewhere in Asia, exposed an over-dependance on the so-called “factory of the world”. This is leading people to explore alternatives and as a proud Frenchman, I am happy to be able to show that, in france, we can offer a great solution that delivers real value.
Three of the major orders we have won as 2020 drew to a close came from exceptional French brands. One is a car maker, another is a tier one automotive manufacturing and the third is an innovative startup in the educational toy space. It is particularly exciting and satisfying to see how we can be a local, reliable and competitive source.
Driver #2 – Short Supply Chains are More Sustainable
By creating shorter supply chains we are building in agility and resilience, but importantly shorter supply chains drive sustainability, lower carbon emissions from logistics and can help create the sustainable well paid manufacturing jobs that will support the post-pandemic recovery.
As we search for a digitally enabled version of manufacturing excellence with the right mix of automation and skilled labor, we are building a manufacturing ecosystem that cares for the planet, care for our team, and cares for the communities in which our factories exist. We firmly believe this will provide a more sustainable future for us, for our customers and for France.
Driver #3 – Government Vision and Support
And the French government agrees with our vision, supporting us and other manufacturers to develop and expand throughout this renaissance and through the country’s economic recovery post COVID-19. Solid and reliable government support has allowed us to make a plan that will see extensions to existing factories, a substantial investment in new equipment, and even the acquisition of additional capacity to meet the increasing demand.
The state’s commitment to recovery and to a sustainable manufacturing sector has aligned perfectly with the desire of our customers to build their products here in France.
Driver #4 – Digital Transformation
It is easy to talk about digital, but there has been too much talk. We have focused on action and our digital transformation plan is well under way. We are already delivering value and economy through incremental improvements on the factory floor, in the supply chain and throughout the business processes performed by the company. We believe the progress we’ve seen through removing paper instructions from the shop floor, better materials management, more supply chain agility and visibility are all contributing to even fewer errors, even faster product changeover times (now less than five minutes) and even more efficiency and competitiveness.
Like the rest of Europe, digital transformation is a journey, but it is one we think is central to our strategy and central to the success of companies like ALL Circuits, our customers and the “Made in France” movement. Even our logo is digital, the 2D barcode on each factory logo will take you right to the website.. Digital is in our DNA.
Driver #5 – Understanding Value, Not Just Price (TCOO)
That’s all well and good, but what is it going to cost? That’s the evergreen question. This is why it is so important for brands and OEMs to understand the difference between value and price. And this means they will have to learn to accurately calculate the total cost of ownership (TCOO). When you buy manufacturing services from a low cost environment, the price at the factory gate might be lower, but are you getting the same value and are there incidental costs that could offset the lower price.
It isn’t cheap to launch a new product a long way from the design facility. And it certainly isn’t cheap to ship a product a long way to the user. And this is just the tip of an iceberg of costs associated with long distance vendor relationships. Just the cost of vendor management, starting with selection, qualification, auditing and troubleshooting can right off any savings made by a slightly lower price.
The Bottom Line
At ALL Circuits we are seeing a real renaissance and while the pandemic has substantially damaged the French economy and many French companies, we believe it has provided a chance to reset and to move forward with a sustainable vibrant manufacturing sector that can provide great services, great value and well paid long term employment.
Vive la Renaissance!
