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Offshore manufacturing alternative – Black Box has found a way to lower costs without going

While the current buzz regarding offshore manufacturing reaches a fevered pitch throughout the industry and companies do their best to address the “U.S.A. versus China” debate, Black Box provides an alternate solution.A year ago, Black Box Distribution, home to Jamie Thomas’ Zero Skateboards and Mystery Skateboards (which launched in October of 2003), set up a board-manufacturing plant just south of the border from San Diego in Tijuana, Mexico.Brand And International Sales Manager Mirko Magnum explains: “We knew this was coming two years ago. That’s when we started looking around for an alternative.” Magnum’s search led to Thomas purchasing San Marcos, California-based Master Core Skateboard Manufacturing from partners Dolph Raasch and Warren Murphy. Master Core had set up Cinco Maderas, the plant in Mexico, three and a half years ago to handle production and had been making wakeboards, snowboards, and skateboards since 1993.Magnum feels it would be almost hypocritical to have an ethical problem with manufacturing boards in China, when so many other products are already manufactured there: “It comes back to planning-we get some of our accessories in China. But we don’t want our boards sitting on a boat for 30 days.”Magnum adds, “The quality wasn’t changing, the ingredients weren’t changing, so we chose to focus on making a quality product, instead of focusing on where the product is made.”Magnum also says all wood used by Black Box is grown in the Great Lakes region of the U.S. and Canada.

Blanking OutOne key factor Thomas and Magnum were looking for in a factory was a place that didn’t sell blank skateboards. “Dolph has always had that integrity. He knew that it was really damaging to skateboarding,” says Magnum. Master Core and Cinco Maderas had previously manufactured boards for both large and small skateboard companies, and also for a few shops.”We didn’t open a factory to contribute to our industries’ problems,” explains Thomas. “The skateboard market is flooded with second-rate blank boards. Making second-rate nonbranded boards doesn’t support skateboarding as a whole, it’s just a quick buck at skateboarding’s expense. If you take the pro skateboarders out of the picture, you’re also removing the excitement and progression from the sport. This will ultimately be skateboarding’s demise. It’s that simple.”Thomas explains their decision to move production to Mexico hinged upon maintaining quality: “We did, on the contrary, open a factory to supply our premium brands as well as other premium brands in the future with quality skateboards at a competitive price.”

The ControversyWhen manufacturing is being taken out of America and into a considerably less-developed country, concerns may arise regarding ethics and human rights. Cinco Maderas provides its employees with fair wages and working conditions, even going so far as to install a hydraulic elevator so workers don’t have to carry boards up stairs. Raasch explains: “On average, we start employees at twice the minimum wage (the equivalent of 45 to 55 dollars a week). From there they go up, depending on their specialties.” Raasch explains Cinco offers employees the opportunity to advance by learning how to operate the different machines (the instructional books are offered in English and Spanish).Another condition regarding foreign manufacturing is that of labeling. “According to NAFTA (North American Free Trade Agreement), we don’t have to label our boards as made in Mexico,” explains Raasch. “Working under NAFTA, if it’s a North American product, it can cross the borders and not be taxed with import or export.”"It’s not like we’re trying to hide the fact,” adds Magnum. “If we were, we wouldn’t be showing you the factory.” In fact, both seemed rather proud of the factory, and that Raasch and Murphy had invested close to two-million dollars in the factory over the past three and a half years. Cinco Maderas is constantly undergoing construction, from installing a temperature-controlled veneer storage chamber to a better ventilation and dust-gathering system. “We’re always looking at what will be the next level of advancement,” says Raasch.

EfficiencyIn time, Thomas, Magnum, and Raasch plan to open the doors to certain other companies, offering them the opportunity to have their boards manufactured at Cinco Maderas. “That won’t happen until we are completely confident we can handle the workload,” explains Magnum. “We don’t ever want to have a company bummed because we shipped their order late. In fact, Mystery is testing our ability to deliver right now.”So what’s the real difference between having a factory in Mexico versus one in China? Magnum explains he doesn’t have a problem with either, but he feels Mexico offers the distinct advantages of quality control and accessibility: “What if you get a shipment of boards from China and they’re all warped? What if there’s another dockworkers’ strike? You’re sitting with nothing for months, and that can make or break some companies.”

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