Podcast: How manufacturers can build stronger regional networks and domestic supply chains
Key Highlights
- Better visibility can help manufacturers find regional suppliers and strengthen domestic supply chains.
- Small manufacturers can build influence through advocacy, peer meetups, and shared manufacturing platforms.
- Large manufacturers can expand supplier networks through pitch competitions, partnerships, and regional convening.
In this episode of Great Question: A Manufacturing Podcast, Ilana Preuss, a champion of small-scale manufacturing and founder of Recast City, discusses the importance of raising the visibility of small-scale manufacturing, whose impact on the larger economy is being overlooked from lack of data and lack of awareness. While large manufacturers attract lots of attention, a strong domestic manufacturing base requires mapping and connecting networks of smaller suppliers that support these larger entities. Preuss presents tools that can help the cause, as well as a model for regional collaboration. In addition, the ReCast City founder dives into ways in which small and large manufacturers can help raise awareness themselves, such as hosting pitch competitions, holding and sponsoring meetups, and more.
Below is an excerpt from the podcast:
Jill Jusko: Welcome to Great Question, a Manufacturing Podcast. I'm Jill Jusko. I'm executive editor at Industry Week, and joining me today is Ilana Preuss, the founder and CEO of Recast City. Ilana recently wrote an article that appears on IndustryWeek called "Regional Manufacturing Networks Need More Visibility,” and today we're going to talk to her a bit about her message in that article, small manufacturing visibility, and then expand on it to what manufacturers also can do to help themselves. So, welcome, Ilana.
Ilana Preuss: Thank you so much for hosting me today, Jill. I'm happy to be here.
JJ: Okay, let's start with some background on you, so the audience knows who they're hearing from. What prompted your interest in small-scale manufacturing community, and what is small-scale manufacturing? How do you define that?
IP: So my interest in this sector really stems from how do we make amazing, great places where we all want to live and work. My background is in city planning and economic development, and I worked for a very long time on issues of housing and transportation, and I kept coming back to the same question about what is going on with our small businesses, what's going on with our local businesses, how do we create places with resilient economies where the businesses are thriving, especially businesses owned by our local residents.
And I went down a rabbit hole looking at many different kinds of businesses, but landed on small manufacturing, and I landed on it because we have a history and a culture of making things not only across the country in big cities and really small towns, but across our population. And people are incredibly proud of the things that they know how to create. They're incredibly proud of the jobs that they create in their community, and more often than not, these businesses are the unsung hero of our community because they are not only providing good-paying jobs, but they're revenue importers. They're selling something outside of their immediate community and bringing dollars into their community—and for that, and a whole host of other reasons, I realized that they were an essential ingredient of creating these resilient, wonderful places that I wanted to support across the country.
And so, 12 years ago, I created Recast City to focus on how to help more places be not only welcoming but have really strong ecosystems in support of small-scale manufacturing. All of the different things that we know that we need to do for a business sector to be able to not only survive but thrive.
So, what is small-scale manufacturing? Small-scale manufacturing is any business that creates any kind of tangible good that you can replicate or package. So that is artisans to advanced manufacturing. We're looking at businesses from one to 50 employees in small scale manufacturing, completely acknowledging that when we can create a stronger, a better environment for that size businesses, that our small business, small manufacturing businesses that are 100, 200, 300 employees still defined as small businesses are going to benefit from those changes as well.
JJ: Okay, and I would agree. A lot of the topics and the companies and organizations we touch on are as relevant for the smaller manufacturer as they are for the micro manufacturer as they are for even the larger manufacturer in many cases. So your article that you wrote with IndustryWeek, you know, it makes a true interesting and true point right up front. You know, it starts with you know. It's true that when big manufacturers break ground or they open a new facility in a location, they get a lot of press. Definitely, IndustryWeek provides some of that press. Less visible, but no less important, is that community of small suppliers that support them, particularly if that company is promoting domestic manufacturing as a key message, as well as you know the larger manufacturer looking to have a reliable group of manufacturers located, you know, in the same city in the same region, rather than an ocean away. I mean, it does great things in terms of reducing lead times and improving a lot of the metrics that are important to manufacturers. So there's no lack of small manufacturers that can help bigger manufacturers be more productive, but visibility of those manufacturers, you know, isn't where maybe it should be or could be. So you suggest that there are models or technologies out there that can help raise that visibility for the smaller manufacturer. Can you talk about some of those?
IP: Absolutely, and I think this is really an essential ingredient to domestic manufacturing and the reshoring conversation that so many places are having, because we have to increase the visibility of these businesses so that we can network them together. Exactly how you're describing. One of the examples I reference in the article is the Carolina Textile District, which is really something that was created by many of the small manufacturers together, they realized that they each had complementary services, and that if you looked across these different businesses, they could take care of the entire vertical in the textile sector. Even though it was a series of businesses that were, in this case, almost all under 50 employees, but they had such very specific niche work that they had done that they continued to do that they could complement them each other in one big system, and so they organized into the Carolina Textile District, which is a single point of entry for anybody who wants to do textile production with any businesses in the Carolinas to understand what services can be provided, who can do the production, pricing, and support for everything from prototyping to full scale production within that region.
And it's really a fantastic model because it was organized originally by the product businesses themselves and manufacturers, and it gives it from a client perspective. The client has a thing they would need to get made, and so it's asking questions from their perspective, and it's a fantastic place to start.
So that's one of the things that I would really recommend people look at as a model. Another one to think about is a business growing out of Rhode Island. It's only about a year and a half old as a business called Nterprisers, and they are taking a step that really nobody has taken the way they they're doing it, and they are creating a comprehensive intelligence platform of all of the small scale manufacturers across every different part of the sector, going state by state, and it is a way not only for economic development leadership to be able to analyze what's there and what's what are the gaps, but even more so is a tool for the business owners, the product business owners, to understand where is there a specific skill or capacity that I need as an input into my business, as well as who is looking for the capacity that I have to be able to grow my business?
JJ: How is that information right now getting to the manufacturers that these resources exist?
IP: It's incredibly partial, right? In every state, we have, or in most states, we have a Manufacturing Extension Partnership, which I'm sure you and your audience are familiar with. And honestly, most of their lists are incredibly partial, and so there is no comprehensive place for folks. And part of the challenge for something like Carolina Textile District or Nterprisers or another organization out of Massachusetts called Forge that really helps folks go from prototyping to contract manufacturing within their own region, they all are word of mouth or dependent on whatever marketing that entity can do in a given day or year, and the thing that I really believe in is that we have to make these models as absolutely accessible and not only transparent but really broadcast this information as widely as possible so more people can use them in the work that they're doing.
JJ: So the article you wrote and this podcast helps in that regard.
IP: Absolutely, that's why we write the articles we do.
JJ: And we are happy to help small manufacturers as well as the large. So, okay, you mentioned that a lot of these lists are partial, and that is what you are trying to move beyond, right? Move beyond partial to greater visibility to get the participants that aren't being served right now onto those, you know, important organizations.
IP: Absolutely, and we work with communities all over the country struggling with this. We've worked with over 200 communities across 44 states at this point, and the No. 1, the first challenge that we face in every community is how do we build the list? It's the first question: How do we actually build the comprehensive list of small-scale manufacturing businesses in our community, and it's still this what I call retail outreach process, where we can pull people off of the business codes basis that are manufacturing and fabrication, but it's never, in fact, everybody because what business code you pick is up to you as a business owner, and so we find food product businesses that want to be in a storefront, so they have to register as a deli, but 99% of what they're doing is a food product that they're doing a wholesale distribution on, and so we need a comprehensive way to collect this information, not (only) booked to make sure that the business owners can work together and the large manufacturers can actually get to that domestic supply chain that we know is so desperately needed. But also, so that we understand the economic impact, the true economic impact of this sector, which is really not understood in any kind of comprehensive way at a municipal level, and certainly not at a state level.
JJ: Okay. So you identified a couple of the organizations and technologies, and for those of you in the audience, again, I'll include links both to the original article and some of these organizations in the write up that I do that that will accompany this podcast, so you can check them out if you are interested. You know, my belief is that the more resources you have to pull from, the better. So, all that said, and it sounds like there are resources for manufacturers to seek out, and hopefully a growing number of resources for manufacturers to seek out. That said, what can manufacturers, big and small, do to help themselves? And I am going to start that question with the small manufacturers and what I know about the smaller manufacturers, right? Unlike larger organizations, you know, lots of these smaller manufacturers they don't have extra people or extra time to do much in terms of either helping build or raise the visibility of the small manufacturing community, and they may not know sort of what to do, right? As much as anything else. So, where would you suggest they direct their limited resources?
IP: So, there's a couple of steps I would suggest. One is: demand attention, and I think we are past the time of this sector really having a position to demand attention. What do I mean by that? I mean things like calling an elected official and saying you need to take care of this business sector. We are here, and we are part of your thriving economy. And you need to direct resources towards us. Base, plain old advocacy. That's one. No. 2 is there's wonderful examples from the tech sector when the tech sector was all the rage and everybody wanted to be the next Silicon Valley.
One of the few things that came out of that that I really liked was that there were folks that were helping organize the business owners and the entrepreneurs in that sector. Things like meetups that were led by the tech business owners. They weren't led by some outside entity, but once a month, the business owners saying we're going to have a meetup for anybody in this sector. It grows over time. It helps with that advocacy, and it increases the visibility of the sector, and it means an hour a month. It's not a major lift in any kind of way to start, to organically start bringing the sector together.
So that's the second thing I would consider, and the third thing I would do is look at initiatives or platforms like Nterprisers, that lets these businesses really have the visibility. It will be going national across over the next year, and really using a tool like that, and demanding other folks in the community create access to that, so that more of the industry really can interact in in a place that has the full network visibility in one place.
JJ: Okay, terrific. And then now let's move on to the bigger manufacturers. So you know, their production is supported by these hosts of small manufacturers in their city, in their region, but they may be unaware of them, or you know, not reaching out like they should, or not knowing themselves, you know, how to support these networks that are so important to them. What can they do to help these small manufacturers make their presence known? How can they build those relationships?
IP: It's a great question, and I love thinking about this because we know that so much of the innovation that happens in any field actually comes from newer businesses inventing a new thing, that new innovation, and then the larger manufacturers are acquiring them. This is an old story that we've seen happen time and time again, and so we know that the larger manufacturers have a vested interest in understanding what's going on in the small manufacturing landscape.
So there are a couple of different examples that would be incredibly successful. The larger manufacturers can host or partner with a public entity to host a pitch competition for specific capacities. If the sometimes we call it a reverse pitch competition. So, if the larger manufacturer, NASA actually used to do this, you would say we need a specific kind of innovation, and businesses could come in and pitch this new innovation, this new capacity, this way that they've been solving the problem, and you get a contract out of it. It was it was a very person-to-person way to expand that network, and I think it's a great way for folks to think about it.
The other way is to partner with entities like Forge to be the larger contract manufacturer if that's part of their work or some of these up-and-coming innovations as part of it, and then I think there's also, from an R and D investment perspective, there is really just this incredible capacity to be that convener, not only through a pitch competition, but through sponsoring things like those meetups, really insisting on the full breadth of not of the network being something that's daylighted, and making that a priority within their own ask to the state or the region or the city that they're based in, so that the community understands that this is an important investment. That political will that the larger manufacturer can show or can ask for is going to be incredibly influential.
JJ: I want to back up into a question that we touched on early on, but I don't know if we completely and clearly articulated it. We are talking about manufacturing networks needing more visibility, and you outlined multiple ways how that can happen. Can we kind of just refocus on what would you describe as sort of the definition of a manufacturing network?
IP: So a manufacturing network in its best form is invisible set of connections across every different size product company within a region or a state, and so it would be across every subsector: food, textile, machine, auto, aerospace, whatever it is. It would be across every part of the sector with the capabilities of those businesses visible and some way for folks to communicate across that space, so that when a larger manufacturer wants to move a certain kind of capacity into their domestic market, there would be one place where they could go and create a short list of folks who could provide that capacity based on tooling that they have in that place, and geography, and experience, and really scale quickly that capacity within the domestic systems.
The other thing I would I think about is from the micro enterprise perspective is that that micro enterprise can go into that same system and find the larger clients that they're going to provide being part of their supply chain as well, so we want to really look at a network as a way for our micro enterprises and really to the economic development world that is any business under 50 employees, which happens to be over 80% of all of our manufacturers. We need to understand how those small businesses can scale by being a stronger part of the domestic supply chain as well, and using that network as well.
JJ: Okay, terrific. What didn't I ask that might be an important point to be made?
IP: That's really great. So one of the things that I that I do want to point out in all of this lack of information is that we, in fact, do not have a very good snapshot of what these businesses are and who we're missing, and that is very much under that label of we don't know what we don't know, right? And so this fall we are going to be releasing the first snapshot to really showcase the strength and breadth of what small scale manufacturing looks like in America, and we are excited to be able to partner with some major entities on their ongoing survey and data analysis, and know that that will only grow in the coming years, but I think it is really essential for us to get our arms around who is in the sector, the economic impact of this sector, so that our community leaders, the economic development directors, the mayors, the governors understand that our current domestic small manufacturers are not only worthy of investment but essential for investment for the sake of our economy.
JJ: Okay, that sounds like a great note on which to conclude today's podcast. So, with that, I'd like to say thank you very much, Ilana. Again, founder and CEO of Recast City. Again, she mentioned multiple resources that I will include in any write-up we do with regard to this podcast. And with that, thank you, everybody, and have a great rest of your day.
About the Author
Jill Jusko
Jill Jusko is executive editor for IndustryWeek. She has been writing about manufacturing operations leadership for more than 20 years. Her coverage spotlights companies that are in pursuit of world-class results in quality, productivity, cost and other benchmarks by implementing the latest continuous improvement and lean/Six-Sigma strategies. Jill also coordinates IndustryWeek’s Best Plants Awards Program, which annually salutes the leading manufacturing facilities in North America.