By Peter Sognefest
Medical device manufacturers selling product globally face significant cost pressures. Not only is there pressure to reduce costs on latest technology products sold in developed nations; there is also pressure to manufacture lower cost, less advanced equipment for developing countries with limited ability to pay for medical equipment. One strategy to support this challenge has been to manufacture all or part of these products in lower labor cost (LLC) countries. Competitive cost and a stable government that supports business are the biggest reasons companies are choosing to manufacture in Vietnam. Wage rates are 35 percent less than those of China. There is no value-added tax on items related to export and no duties on imported components used for product built for export. From a manufacturing infrastructure and expertise standpoint, Vietnam has emerged as a location capable of delivering high quality at low cost. According to the U.S. Census Bureau, Vietnam now ranks as the 13th in terms of U.S. trading partners, exporting $38 billion to the U.S. in 2015.
Medical device manufacturers selling product globally face significant cost pressures. Not only is there pressure to reduce costs on latest technology products sold in developed nations; there is also pressure to manufacture lower cost, less advanced equipment for developing countries with limited ability to pay for medical equipment. One strategy to support this challenge has been to manufacture all or part of these products in lower labor cost (LLC) countries. Competitive cost and a stable government that supports business are the biggest reasons companies are choosing to manufacture in Vietnam. Wage rates are 35 percent less than those of China. There is no value-added tax on items related to export and no duties on imported components used for product built for export. From a manufacturing infrastructure and expertise standpoint, Vietnam has emerged as a location capable of delivering high quality at low cost. According to the U.S. Census Bureau, Vietnam now ranks as the 13th in terms of U.S. trading partners, exporting $38 billion to the U.S. in 2015.