Industry News

For US companies that outsource some or all of their production to China or otherwise have operations there, the ongoing trade war presents a tangle of cost uncertainties. Some companies are being forced to rethink their supply chain — and on a compressed timeline.

More reading on this: How Will the Trade War Affect US Machinery and Equipment Vendors?

However, amidst the onslaught of supply-chain challenges, one opportunity that does remain relatively buoyed by the tariffs is the prospect of exporting goods to China that have not been slapped with retaliatory tariffs. Certainly, many of these companies are seeing input costs rise similarly to the myriad other industries being squeezed, but their advantage in this trade war is that these cost increases are tempered by reduced competition.

That is, for companies whose products are not facing Chinese tariffs but whose Chinese counterparts are facing American tariffs, there may be a window of opportunity after all. One of these product categories is industrial equipment and machinery.

According to Export.gov, a resource managed by the US Department of Commerce's International Trade Administration, fewer than 20 Chinese companies can provide medium and high-end CNC machine tools. Yet Chinese demand for metal cutting, forming machine tools, and accessories are expected to grow at a strong pace. Meanwhile, in alignment with the increasing demand for quality in China, the majority of US machine tools companies are focused on high-precision, intelligent high-end CNC machine tool and accessories.

A top priority of the Made in China 2025 initiative is to upgrade the manufacturing sector by adopting high-tech intensive manufacturing by making the best use of foreign capital and management expertise. For US SMEs, this may be the right moment in time to carve out market share as China is boosting its domestic needs.

While the United States may be better known as the world's leading exporter of services, material goods still represent two-thirds of its total exports.

US companies are known for producing innovative and high quality products, so China's growing appetite for quality presents unprecedented opportunity for US firms to export their high quality and durable industrial products and components/parts to Chinese manufacturers in various sectors.

Meanwhile, market entry challenges do exist for US firms interested in tapping into these export opportunities. For one, providing localized after-sales service requires a certain degree of capital that may seem risky particular for smaller US firms. Moreover, despite increased efforts from the Chinese government to improve Intellectual Property Rights (IPR) protection, handling the challenges of protecting IPR in China requires an understanding of the complex legal environment.

Moreover, companies interested in exporting typically must invest a considerable amount of resources in planning, developing and executing international sales strategies in order to succeed in today's global marketplace. As a result, smaller companies with fewer resources may find such initiatives to be too risky at their size.

By partnering with Toolots to sell through our online platform, manufacturers can get the tools and assistance they need to expand their company's international sales. Reach us through our contact page to learn more.

More reading on Toolots' vendor services: How Toolots Fulfillment Services Help Vendors Grow Their Distribution

In the midst of the looming trade war between the US and China, there is considerable dispute over what the real impacts of the tariffs are likely to be. However, one thing is certain: Not all industries will be affected in the same way. In this post, we’ll take a look at what these tariffs mean for US machinery and equipment vendors in particular.

Standard economic theory holds that everyone loses in a trade war: Tariffs make goods more expensive, and therefore exporters will lose business. Indeed, there seems to be an acceptance on the US side that business will be lost, but Trump and his advisers argue that the US is sure to win in relative terms.

The US tariffs on 818 items from China, largely machinery and equipment, average 25 percent. What does this mean in a supply-chain context? And what does it mean for US vendors of machinery and equipment?

For certain machinery manufacturers, the positives could outweigh the negatives

On one hand, the steel and aluminum tariffs increase the cost to manufacture equipment. On the other hand, there are now US tariffs on Chinese machinery and equipment but no Chinese tariffs US machinery and equipment. China’s retaliatory tariffs are largely around consumer goods.

For example, the tariffs list covers injection molding machines, extruders, blow molding machines and thermoformers. While this isn’t great news for importers of Chinese-made plastics machinery or for companies that source substantial imported components, it could mean new machine sales opportunities for US-made machinery.

Many American companies have their supply chains built around Chinese machinery and equipment. Reducing Chinese vendors from these supply chains will take time and are likely to be costly for US machinery importers and various manufacturing businesses, and perhaps ultimately a bump in prices of final goods the US consumer. However, this is good news for domestic equipment and machinery vendors.

Is there a verdict? It depends on your supply chain

In the end, it all comes down to supply chain. For smaller US industrial companies without operations or partnerships in China, these tariffs are likely a positive. And for vendors who source components from China, the increase in components costs may be leveled in part by the tariffs on competing machinery from China.

If you're an equipment or machinery manufacturer who's looking to take advantages of new opportunities, we're here to help. Whether you're looking to start selling your equipment online or export to China, we can help you make it happen. Reach out to us through our contact page to learn more.

Examining the growing ugly Christmas sweater market for SMEs and entrepreneurs on National Ugly Christmas Sweater Day, and the importance of the U.S. textile industry.

CERRITOS, California- December 15, 2017- Since 2011 the U.S. has celebrated National Ugly Christmas Sweater Day on every third Friday of December to commemorate eccentric, gaudy, or vintage sweaters for Christmas and winter Holidays.  Two decades after these sweaters originally became popular in the 1980s, the once small ugly Christmas sweater market now generates millions of dollars year round.

Toolots employees in their ugly Christmas sweaters.

Ugly Christmas sweaters and related products can be categorized in the U.S. textile industry.  According to the National Council of Textile Organizations (NCTO), the U.S. textile industry collectively comprises “…yarn and fabric manufacturers, suppliers in the cotton, wool, and man-made fiber sectors, dyers, printers, and finishers, the machinery and textile chemical industries, [and] customers in the U.S. apparel industry.”  As the leader in textile R&D globally, the U.S. has increased productivity of its textile mills by roughly 52% since 2000 and had $74.4 billion in shipment value in 2016.  Aside from creating ugly holiday sweaters, the U.S. textile industry is also responsible for manufacturing and producing advanced fiber products such as antimicrobial fibers, recycled polyester fibers, fire-retardant fibers, and more.  Additionally, the U.S. textile industry provides U.S. Armed Forces with over 8,000 textile products including, but not limited to, uniforms, ship composites, ropes and cables, ammunition pouches, and parachutes.  Furthermore, the NCTO reports that the volume of items provided to the military can vary depending on activity and engagement, and most recently has ranged between $1.8 billion to more than $2.2 billion.

Source: U.S. Bureau of Statistics Textile, Apparel, and Furnishings Workers (51-6099)

Following severe imports during the 1990s, a significant number of the U.S. textile and apparel industry’s annual profit currently derives from holiday shopping at the end of the year.  Data collected by the U.S. Census Bureau for the 2016 Holiday Season found that 21.8% of Clothing Stores’ annual profit came from holiday sales completed in November and December alone.  Similarly, holiday sales were roughly 23.7% of Department Stores’ annual profit, and 22.5% respectively for Discount Department Stores in 2016.

For SMEs in the ugly Christmas sweater business, a seasonal hobby that may have made them several hundred or several thousand dollars now has the potential to generate millions of dollars in profits.  Despite major retailers and fashion designers entering into the market, SMEs and entrepreneurs generate a significant amount of revenue by using e-commerce stores to sell their vintage, licensed, or customized sweaters.  For example, the Ugly Christmas Sweater Kit saw a sales increase of 1,000% just in 2013, the UglyChristmasSweater.com made $4.8 million in 2015, and the Tipsy Elves increased their revenue to $14 million last year from initial sales of roughly $900,000 in 2013.

About Toolots

Toolots, headquartered in Cerritos, California, offers an online marketplace and international distribution channel for factory-direct industrial tools, machinery, and manufacturing technology. Our user-friendly platform provides fast, easy access to high-quality, affordable equipment for manufacturers. More than a simple distribution channel, Toolots provides comprehensive services for companies around the world who produce the industrial machinery and equipment we sell, helping streamline the marketing, omni-channel sales, warehousing, fulfillment and after-sales service. On the customer end, Toolots simplifies the purchase, delivery, installation and warranty of industrial technology, machinery and components, and upholds product quality through a vetted network of vendors and service technicians. The company’s dedication to fostering international trade relations passes on cost savings to the consumer, contributes to reduced downtime, improves productivity and expands a manufacturer’s reach. Toolots has strategically located warehouses, showrooms, and offices across the United States, China and as of May 2017, has expanded into Taiwan. For more information visit us online at www.toolots.com.

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How additive manufacturing is being used to improve production and reduce costs in traditional manufacturing 

CERRITOS, California- October 26,2017- Since its creation in the 1980s additive manufacturing, also known as 3D printing, has gained recognition within the traditional manufacturing and industrial industries due to its versatility and cost-effective applications. Originally, models were printed layer by layer using photopolymer resins as material and commonly used for prototyping. However in modern day printing, models can be made from a variety of materials such as carbon fiber, magnetic, metal, clay, biodegradable, and many more. 3D printing is used in a multitude of industries to create prosthetic limbs in the medical field, components for aerospace construction, and tools to improve the manufacturing industry.  

Through traditional manufacturing, an engineer would create a computer model of an engine manifold and wait about four months for a $500,000 prototype. With 3D printing, multiple iterations of the same component takes four days and cost[s] $3,000. -Jim Joyce, Deloitte 

For manufacturing SMEs, 3D printers offer cost saving alternatives in various production processes. During machining for example, segments of a material are removed to create a part, therefore creating scrap. Conversely, scrap is significantly eliminated when the same part is made using a 3D printer because material is added, layer by layer, instead of being removed. Essentially, 3D printed parts are usually made in one uniform piece, thereby increasing the parts' durability and overall strength. Thus, by printing the part in one piece, the part is lighter in weight and reduces the need for assembly. Furthermore, the computer-aided design (CAD) files for parts saves costs in both labor and resources that previously may have been dedicated to dies and fixtures. CAD files can also be altered or paused mid-print to make design revisions when necessary. Additionally, one of the major benefits of 3D printing is ease of use for the operator when printing two or more products with vastly different designs.  Currently, manufacturing companies use 3D printing for part replacement, cheaper prototyping, complex tool fabrication, and more.  Manufacturers and machine operators are able to download or design CAD files to print replacement parts in a matter of hours. This can significantly reduce production down time, and the same layer by layer construction process that reduces scrap also allows more elaborate tools and parts to be printed. During machining, these same designs might be too elaborate or time consuming to create. In addition, during the prototyping process various models can more easily be printed and revised, therefore consuming less resources. 

While the complexities of 3D printing may be daunting, Toolots is positioned to help SMEs or hobbyists explore additive manufacturing through its latest product, the Desktop Mini ISEE 3D Printer. The ISEE can be powered by a 12V power source and includes PLA filaments, a biodegradable thermoplastic made from renewable resources like corn starch. PLA is one of the easiest filaments to work with, making the ISEE and its simpler design perfect for beginners. Learn more about purchasing the ISEE 3D Printer.

To learn more about the ISEE, or for purchasing information, click here. 

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NAM Q3 Manufacturers Outlook Survey shows the highest rate of optimism for 3 consecutive quarters in 20 years. 

CERRITOS, California- October 12, 2017- The National Association of Manufacturers (NAM) recently released their Manufacturers Outlook Survey for the third quarter of 2017 containing updated information on manufacturers' perception of the current state of the industry and its growth within the following year. As the U.S.' largest manufacturing association, NAM represents small to large manufacturers throughout the country and "...accounts for more than three-quarters of all private-sector research and development in the nation" (NAM). Data from the survey is pulled from the responses of approximately "...524 manufacturers from all parts of the country, in a wide variety of manufacturing sectors and in varying size classifications" according to the report.  

In their Third Quarter Manufacturers Outlook Survey, NAM reported an average optimism rate of roughly 90% among manufacturers. This is the highest record of optimism recorded since the survey began roughly 20 years ago in 1997. Comparably, the third quarter average in 2016 was only 59.7%. Furthermore, the positive trends continued throughout the report in regards to exports, production, sales, and more. Respectively, the average expected increase in sales and production was 4.5%, and overall positive outlook for business was 89.8% among manufacturers. 

Moreover, the increases in sales and production anticipated by these manufacturers also produced an anticipated increase in labor demand. Thus, surveyed manufacturers expected to increase their full-time employees by an average of 2.2%, resulting in a matching 2.2% average increase in employee wages excluding nonwage compensation. This reinforces NAM's prediction that the manufacturing industry, which contributes an estimated $12 trillion to the U.S. economy annually, will create roughly 3.5 million jobs over the next decade. 

Similarly, the NAM Manufacturing Outlook Index also indicates strong levels of confidence in business conditions year-to-date, rising from 60.8 in the second quarter to 61.0 in the third quarter. By comparison, the index stood at 41.3 one year ago.-NAM Manufacturers' Outlook Survey Third Quarter 2017

Overall, this quarter's Manufacturers Outlook Survey reveals a positive shift in the industry's outlook, and an anticipation for growth or revival in regards to production, sales, and staffing. Specifically, data within the report suggests that production within the manufacturing industry could grow as much as "...3.6 percent between now and the first quarter of 2018". With increasing optimism in the industry, SMEs in the U.S. have the opportunity to explore business expansion. Toolots is uniquely positioned to offer SMEs assistance expanding their distribution network domestically, or entering into the global market by providing assistance overcoming barriers such as inefficiency, slow innovation, and high prices. For additional information, contact us via phone at (844) TOOLOTS or via email at sales@toolots.com. 

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CERRITOS, California- October 17, 2017- Since 1945, the Food and Agriculture Organization of the United Nations (FAO) has celebrated World Food Day (WFD) on October 16 of each year to commemorate its founding. Yesterday, over 150 countries throughout the world celebrated WFD  to "... promote worldwide awareness and action for those who suffer from hunger and for the need to ensure food security and nutritious diets for all." Specifically, this year's theme focused on solving the issue of migration through increased food security and rural development. 

One major component in ensuring food security however is the actual processing and manufacturing of agricultural materials into food and beverage products. Within the U.S., food manufacturing is a vital component of the greater manufacturing industry as it essentially generates significant revenue for the economy and helps create edible food products. In 2015 the products created during food manufacturing and processing actually accounted for "16% of the value of shipments from all U.S. manufacturing plants."  

The Value of U.S. Food Manufacturing 

According to the United States Department of Agriculture (USDA), food processing occurs at food manufacturing plants where "... raw agricultural materials [are transformed] into products for intermediate or final consumption by applying labor, machinery, energy, and scientific knowledge." Essentially, these manufacturers help transform the food grown by farmers into edible products for consumption after preparation, or for immediate consumption. In addition to helping supply the U.S. with food, the industry also employs a significant number of employees. As of 2015 these facilities employed roughly 1.5 million workers, which accounted for 14% of employment within the U.S. manufacturing industry as a whole. 

Furthermore, food manufacturing is able to contend with fellow subsectors in regards to revenue generation. During Industry Week magazine's IndustryWeek US 500 2017 for example, a ranking of the largest U.S. public manufacturers by revenue, 31 food companies appeared on the list.  

Only four manufacturing categories -- petroleum & coal products, computers & other electronics products, chemicals and machinery -- had a greater number of representative companies on the IW 500 than [the] food manufacturers. -Industry Week 

Altogether these food companies earned a collective $337.3 billion dollars in revenue, out of the $12 trillion NAM estimates the manufacturing industry collectively contributes to the U.S. economy annually. Additionally, manufacturing production increased this month indicating signs of recovery since June 2017 following several hurricanes and natural disasters in the U.S. As such, Toolots is uniquely positioned to help food manufacturing SMEs expand their current distribution network, break into the global market, or offer assistance with after-sales services, organization, and competitive pricing to tap into the growing market. For additional information, contact us via phone at (844) TOOLOTS or via email at sales@toolots.com. 

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Bureau of Labor Statistics Reports Ongoing Growth in Industrial Machinery, Fabricated Products

Toolots, Inc. is a full-service online distributor of industrial machinery, equipment and components based in Southern California. More than 120 companies from the U.S. and China sell their products through the eCommerce platform and benefit from included marketing, customer service, engineering and other support services.

CERRITOS, Calif. – June 8, 2017 – Following six straight months of consistent gains in the number of manufacturing jobs in the United States, the Bureau of Labor Statistics has reported significant growth within the industrial machinery and fabricated metal products categories.

According to a newly released economic report from the leading national trade association for US-based manufacturers, the National Association of Manufacturing, industry leaders have reported sustained optimism and employment growth, as well as a significant uptick in new orders for their products and speedier acquisition of new customers. In April and May 2017, manufacturing exports from the U.S. also increased 3.4 percent compared to the same time period in 2016, according to the report.

“We have seen higher expectations for job growth of late in light of a stronger outlook for demand and production,” NAM leadership said in a statement released Monday. “Encouragingly, manufacturing exports have trended in the right direction in the early months of this year – a welcome development after weaker data in each of the past two years.”

It’s more than just the number of manufacturing jobs that are growing. Demand for U.S. manufactured goods has also increased.  Thirty-two percent of manufacturing businesses surveyed in the most recent Dallas Federal Reserve Bank reported an increase in new orders, and faster growth rates for those same new orders.

NAM said this indicates significant progress and gains, likely resulting from an increase in “business confidence, better energy commodity prices, improvements in the global economy and a post-election boost in optimism.”

Do you have newly manufactured products to sell on the industrial equipment and machinery market? Ride the wave of growing optimism within US manufacturing by partnering with Toolots to increase the sales and distribution of your unique products. By teaming up with hundreds of companies within the US and around the world, Toolots has the infrastructure to make sure your industrial equipment gets in the hands of new customers for little to no risk, and for no up-front cost.

Toolots partners enjoy wide-ranging services including sales and customer service assistance, marketing, SEO and public relations support, the backing of our cross-border logistics and fulfillment team, as well as extensive after-sales services like repair, maintenance and engineering support. To learn more or to connect with our Global Commerce Services team to discuss how Toolots can help grow your business, call us today at (844) 866-5687.

About Toolots

Toolots, headquartered in Cerritos, California, offers an online marketplace and international distribution channel for factory-direct industrial tools, machinery, and technology. The user-friendly platform provides fast, easy access to high-quality, affordable equipment to manufacturers. Toolots provides comprehensive services for companies around the world who produce industrial machinery and equipment, helping streamline the marketing, omni-channel sales, warehousing, fulfillment and after-sales service. On the customer end, Toolots simplifies the purchase, delivery, installation and warranty of industrial technology, machinery and components, and upholds product quality through a vetted network of vendors and service technicians. The company’s dedication to fostering international trade relations passes on cost savings to the consumer, contributes to reduced downtime, improves productivity and expands a manufacturer’s reach. Toolots has strategically located warehouses, showrooms, and offices across the United States, China and as of May 2017, has expanded into Taiwan. For more information visit us online at www.toolots.com.

Ride the wave of optimism and fuel your company’s growth with Toolots, getting products in the hands of new global customers

CERRITOS, Calif - April 4, 2017 - With the Trump administration slashing federal regulations on small business growth and an “America First” focus on trade, manufacturing and homegrown industry, the National Association of Manufacturing is reporting the largest boom in United States manufacturing industry confidence in decades.

Ninety-three percent of U.S. manufacturers surveyed by NAM, the oldest and largest manufacturing association in the country, reported a positive outlook for the future. Chief Executive Officer Jay Timmons said the survey of industry executives polled higher than it has throughout the organization’s history. Respondents were also asked whether they believe the administration is on the “right or wrong track” as it relates to manufacturing.

“Just a month before inauguration (Jan. 20), the ‘right track’ number was only 26 percent; today it’s over 60 percent, so that’s huge growth,” Timmons said. The survey of manufacturing executives takes place each quarter and spans 14,000 members, according to NAM.

White House officials cited the survey during the March 31 press briefing, expressing confidence that the administration’s actions on trade - namely leaving the Trans-Pacific Partnership and recent executive orders - are helping to nurture that optimism.

“That’s a 20-year record high that’s more than 35 points higher than where it was the same time last year,” the White House press secretary said, referencing the same poll taken last year that gauged optimism within the industry at only 57 percent. “The rising confidence stems from the belief the new administration will bring much needed regulatory relief...We’re making it easier to do business, and we’re just at the beginning of this process.”

While it is taking time for the optimism to translate into quantifiable results on the ground, small, medium and large manufacturers have invested hundreds of millions of dollars, billions in total, towards bolstering American factories and a stronger domestic workforce. Riding the wave of optimism are countless companies purchasing new machinery to set ablaze their U.S. production capabilities and hiring employees to sustain increased operations.

How Toolots can help

As optimism rises across the country based on the NAM survey, more than a dozen American manufacturers have signed up to sell their Made in USA products on the Toolots online marketplace within the last three months. Toolots is a Southern California-based distributor of industrial machinery, equipment and technology that helps companies break into new markets, domestic and international. With strategic locations in California, Texas and China, Toolots does the heavy lifting to simplify logistics and fulfillment for consumers and vendors, resulting in a hands-off, worry-free approach to selling industrial equipment.

Many small to medium-sized U.S. manufacturers are in need of such a solution to get their innovative products in the hands of new customers. Toolots provides a low risk method to increase distribution of manufacturing equipment, and a comprehensive solution for sales, marketing, fulfillment and after-sales services.

With growing optimism among manufacturing executives and increasing opportunities within the labor force, small to medium-sized companies have an opportunity to provide equipment in high demand both here in the U.S. and abroad. In countries like China, factories are willing to pay a premium for Made in USA products to increase productivity and reduce operational downtime often associated with lesser-quality manufacturing equipment.

Breaking into the Chinese marketplace is not an easy task, especially for the small companies that comprise a majority of the U.S. manufacturing industry. Our logistics pipeline has served Toolots and related enterprises well for years, and our ongoing partnerships with factories across China and the United States help to build a bridge to connect their manufacturing industries. Through Toolots, partnering manufacturers are able to secure sales directly with factories in need of their products - not needing to spend time marketing, selling and distributing their goods in newer unfamiliar markets on their own, risking loss of profit, productivity or even product.

As an industry, American manufacturing employs over 12 million and contributes more than $2 trillion annually to the U.S. economy. The manufacturing industry has the “largest economic impact of any major sector” and accounts for more than 75 percent of all private-sector research and development, according to NAM. Greater than three-quarters of all U.S. manufacturing firms are classified as small businesses with fewer than 20 employees.

For more information on how working with Toolots could fuel your company’s growth during this period of record-high optimism within the U.S. manufacturing industry, contact our Global Commerce Services team today at (844) 866-5687 or send inquiries to cfoy@toolots.com.