Global Value Chain at Work in Minnesota

chain.bmpIn our latest publication, Forging New Partnerships: How to Thrive in Today’s Global Value Chain, we highlight small and medium manufacturers who are expanding their business model into overseas markets.

One of the most clearcut case studies in our book is that of E.J Ajax, a metal stamping company outside of Minneapolis. With 50 employees, the company is not shy about pursuing business opportunities abroad. One of Ajax’s customers makes rice and vegetable steamers and Ajax supplies a sophisticated metal part for those appliances.

When his customer decided to move its production of these products to Asia, it didn’t at first look good for Ajax to hold on to this business. But Erick Ajax explains in Forging New Partnerships that he was committed to keeping this business and in following his customer to Asia. He succeed in convincing them that he was still the right supplier and so he maintained his contract with the appliance maker.

Best of all is this: the appliance maker sold 100,000 rice and vegetable steamers when they were made in the United States. Now, with an Asian market that is more interested in such products, they sell 700,000 units. And Erick Ajax outside of Minneapolis is now supplying seven times the number of metal components that he did before.

Erick Ajax and his company have found the way to survive in the global marketplace and even thrive. Following customers as they locate production abroad to serve foreign markets is one way to do it.

Join the discussion One Comment

  • John V. Westberg says:

    Its great to hear success stories like this. My concern for Erick Ajax’s company is what does his company have in the way of exclusive capabilities that some company in China couldn’t eventually duplicate at a lower cost ?

    I’m retired from being the president of an electronics final-product manfacturing company. What we could produce for $100 our competitor in China could produce and land in the U.S. for around $15. This makes it rather diffcult to keep manufacturing in the U.S.

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