China's cost spike

As China makes big moves to break into the first world, U.S. companies that manufacture there face soaring costs in a region that used to be the home of cheap, outsourced production. Here's why prices have jumped - and how 4 small companies are being crunched.

1 of 4
BACK NEXT
Going green has businesses seeing red
Melanie Corpstein
CEO, Adorable Originals
Started manufacturing her line of dolls in 2003.
Cost increase in past five years: 20%


Beijing's initiatives to curb pollution have resulted in the closure of many dirty factories, while remaining manufacturing plants face stricter environmental regulations. New, clean technologies, water management and recycling efforts aren't cheap, and small-business owners who outsource to China see the changes are in their bottom lines. Corpstein's Phoenix firm, which manufactures toys and clothing, has seen her profit margins for her line of dolls shrink since she began manufacturing them in China in 2003.

"In this economy, it's not a great time to raise prices," she says. "We are stuck between a rock and a hard place, and end up having to absorb the cost."


NEXT: Labor controls
LAST UPDATE: Aug 11 2008 | 8:04 PM ET
Sponsored by
More Galleries
Commuting is getting easier. Here's why The MobiPrize, conducted by SMART at the University of Michigan, recognizes innovation in global transportation. From microcars to auto rickshaws, these six startups are some of the standouts. More
A sampling of beers being made with traditional Latin flavors A small but growing number of craft breweries are including passion fruit, Mexican cinnamon and other traditional Latin flavors. More
Banks won't lend? Use these guys instead Banks often have exhaustive approval processes, high minimums, and flawless credit requirements. But there's a wealth of non-bank alternatives for those who need capital fast. Here are some of the leaders. More

Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.