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Comment by bugsy | Hacker News Reader

At a place I worked a few years ago we had to individually retest every single unit of our products. This involved opening up packaging and repacking and reshrinkwrapping afterwards. In between unpacking and repacking there was testing and finding about 1/3 of them always had problems. Some boards could be fixed by diagnosing to the component level, replacing components and even resoldering incorrectly wired interboard connects. This work was done by asian immigrants of uncertain immigration status. This rework quadrupled the cost of the products but somehow it was still cheaper than just manufacturing locally to begin with, something like the exact same product was costing $20 per unit from asia, but $200 per unit to build in the US. Apparently the big cost difference was due to the effect of environmental laws regarding not being able to dump toxic waste in a river in the US.

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This type of testing sounds like a huge pain, but makes a big difference for customer satisfaction to the point where a company can differentiate themselves by doing it.

A company called Yongnuo makes some fantastic speedlights (photographic flashes), which are inexpensive alternatives to the fully-automatic Canon/Nikon standards for strobist photogs. Think $40 instead of $400.

The trade-off is that many of them arrive defective, they are known for not having good QA. There are sellers on ebay who make it a point to test every one before shipping. Guess who I chose to buy mine from? Not a bad way to make a profit and stand out on an otherwise low-margin item.

Yes, if the customers are doing hardware testing it's a disaster for satisfaction, and you also have the cost of repair and shipping and recalls. It's very interesting trade off wise. When I worked in the semiconductor industry, there was a fail rate of something like 35% of chips cut from the wafer. Depending on the complexity and size of the chip relative to the wafer, that rate could go up to 90%, or down to 10%. This is because of things outside of human ability to control, microscopic defects in the substrate for example, or a single dust particle that got into the clean room. These were tested on the full sized wafer and marked with dots and then after cutting the ones with dots are tossed out. Needless to say, it is utterly crucial that significant parts of the chip design must be solely for the purpose of being able to completely test functionality on-chip. This results then in 100% functioning of things that went out the door. I've never even seen a CPU that went to a customer that had a known defect at that stage, so the step of tossing away a large number is just part of manufacturing. However in the case of manufacturing boards overseas, it is definitely possible to increase field significantly. The units were just as testable over there as they are here in the US, without the trouble of unpacking and repacking the retail boxes. But for whatever reason reform of the foreign manufacturing plant simply was not happening and not something they were interested in, and management apparently felt that the trade offs involved made sense, including all the extra rework and testing.

One thought that has occurred to me though is that Apple is using much more poor quality manufacturing than they were years ago, and there is a high failure rate of Apple laptops. However, they have a warranty that covers fixing everything for 1 year and everyone sane knows to buy the extended 3 year since there's something like a 1 in 4 chance you'll need it. So Apple has figured that they save enough making it in China that they can absorb the cost of fixing 25% of the ones where the customer bought AppleCare. These repairs are usually replacing the whole motherboard with spares that they buy in vast quantities for each and every model. This is all done very intentionally for sound economic reasons and customer satisfaction is very high despite the failures.

darn those pesky environmental laws.

edit: oh wait! We'll just dump it in Asia instead! Yay!

Exactly, and then it flows down the rivers into the Pacific ocean and swirls around to the US or sinks and poisons the fish that are caught and sold to US. Hm.

(For those dislike any and all criticism of, well, China, a possible solution would be to require that trade partners implement and enforce similar levels of environmental regulations on manufacturing so that international trade is not just "exporting pollution". This is not simple though because China has a habit of fake-certifying things (for example much Chinese-grown "organic" food is organic in certification alone). So to work in reality and not theory, this would involve non-Chinese inspectors throughout the country with full access to inspect things, which would probably not be acceptable to Chinese State officials. In reality, things will continue as they have been going until the oceans can no longer support life, followed by massive extinctions of other animals such as humans and all other species whose ecochains have links relying on healthy ocean functioning to live.)

> a possible solution would be to require that trade partners implement and enforce similar levels of environmental regulations on manufacturing so that international trade is not just "exporting pollution".

I'd love that, but you do realize that it would stop 'outsourcing' pretty much dead in its tracks. (not a bad thing by itself).

This will also immediately be reflected in the sticker price of the goods.

So you were basically saving $180 in exchange for a more polluted planet. Great exchange if I ever saw one.

Realisticlly, if you don't do it then a competitor will and not only will he pollute the planet, but drive you out of business with his cheaper units.

That's a shitty justification for causing irreparable harm simply because you need to make a buck.

That's not (just) for making a buck. You bring value to your customers. In the current system if you are more environmental friendly than your competitors you will go out of business (the comments here talk about 10x the costs). I'm not saying this is ALWAYS true, but as a general rule. The system makes environmental consumer-based businesses non-sustainable. The system causes such businesses to be unsustainable. Now, what is 'The system'?

The easy (but probably wrong) answer would be how western import taxes don't have enough environmental/ethical component in them.

No, it's very reasonable, and it's the reason that these things need govt. regulation. Otherwise, it's just tragedy of the commons all over the place.

You are correct that the system is not what is best for the world, however we do not have tariff regulations that would temper the effects of exporting pollution and human misery, and corporate interests control legislation to this effect through lobbyists and bribes. Right now, if you work, the company you work for is destroying the environment. Even Greenpeace and PeTA use computer components made in China, and drive cars that use oil paid for with human misery in authoritarian and failed states. To have a job or a computer at all you become part of the system. There is the option of going completely off grid and being self sufficient in an Adobe house in Mexico, or a cabin in Alaska, but few choose this path.

This is what regulation and tariffs are for.

Too bad we can't be bothered, since we must protect corporate profits at any cost.

120 bucks, actually.

Yes, that is basically correct, although the difference in cost wasn't all environmental obviously, there was also the advantage of using a labor pool with few rights compared to the US, poor health care, and other factors.

On top of unit costs there is cost to stock in store, cost of the store's profit, etc. Let me ask you this, would you be willing to pay $10,000 for a computer Made in USA? Is the computer you are working on right now Made in USA, or are some components from China?

That's the answer right there. We can pay $1000 for a Chinese made laptop or $10,000 for an entirely USA made one top to bottom. What market is there for the eco and labor friendly USA one, and what is the chance that a company selling these would stay in business for even 6 months? Is the chance greater than 0%?

I don't think a vendor could convince me they didn't merely mark up a $1000 slave labor computer. In Collapse, Diamond wrote about sham "sustainable forestry" certifications from that self-regulated industry; I can't believe that wouldn't happen here as well. Even with orders of magnitude more money involved, Wall St. couldn't find honest appraisers, so what chance do we have?

It wouldn't be self-regulated; there are already laws about declaration of origin on products. The "Made in China" stickers on devices aren't there because the manufacturer is giving the vendor a discount for advertising the Chinese origin. They're there because customs can seize and destroy mislabeled products.

Yep, I know. I wonder what would the global income equality be like if it cost the same to make a component in China as in the USA? Would it really be 10x the cost?

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