Tool Box

Issue No. 28 - April/May 2006

Is there a future for manufacturing?

by Mr Chris Whelan

The manufacturing sector in Australia has shrunk from around 25% of GDP in the 1960s to about 10% today and is likely to fall to single digits by 2010.

Many of the remaining manufacturers are under constant pressure from low-cost imports and yet, despite these statistics, there is a future for manufacturing in Australia.

Those Australian manufacturers that are successful have found a niche market for their products where low price is not their main competitive advantage.

Australian manufacturers producing for mass markets cannot compete with countries like China because, among other things, the average wage rate in China is less than $1 per hour.

More and more Australian manufacturers who are competing with cheap imports are either relocating their manufacturing operations to China and other countries with low wage costs, or becoming importers from those countries.

So what are the characteristics of niche products?

A niche product is one that h...

The rest of this article is available to in-business subscribers.
If you are a subscriber, please log in - click here.

Established in 2001, in-business is South Australia's leading independent local business knowledge source. We offer subscribers:

• a high quality bi-monthly magazine
• password access to our complete archives online from Issue 1
• regular SNAPSHOTS eNewsletter
• optional listing in our magazine business services directory called 'the team'

in-business has become one of South Australia's best networking packages delivering readers untold business opportunities.

To subscribe click here, or to receive a free trial copy click here.