"Outsourcing" -- Mag Instrument bucks the trend:
With total flashlight production rising, and with the proportion of that production that goes to export markets edging upward toward 50%, many companies in Mag Instrument's position would succumb to the temptation to "outsource" their flashlight manufacturing. Some would lay off their American manufacturing workers and move their factories to low-wage countries, becoming importers into, rather than exporters from, the United States. Other flashlight companies would lay off their American manufacturing workers and would quit the difficult field of manufacturing altogether: They would choose instead to be mere marketers and middlemen, taking orders from customers on one hand while, on the other hand, giving orders to contract manufacturers in lowwage countries to make flashlights for them. Those flashlights, made "offshore," would then be purchased from the foreign company and imported into the United States, to be bought at retail by those Americans fortunate enough to still have jobs.

This scenario is anything but far-fetched. In fact, every supplier of flashlights with a significant U.S. market share now manufactures all or most of its flashlights outside the United States. Every one, that is, except Mag Instrument.

Among significant suppliers of flashlights to the U.S. market, Mag Instrument is unique in its commitment to U.S.-based manufacturing. Consider this:

• Mag Instrument has always been headquartered in the U.S.A., where the company's only flashlight production facilities have always been located, and where it is now expanding those facilities.

• Every Mag Instrument flashlight was personally designed in the U.S.A., by Mr. Maglica, under whose watchful eye Mag's engineering staff in Ontario, California, still works constantly at improving and refining Mag's products and developing new ones.

• Every single production employee on the Mag Instrument payroll lives and works in the U.S.A.; and it has always been that way. Of course, Mag does employ sales personnel in the other regions of the world where Mag® flashlights are sold; but all of Mag's flashlight production facilities, and all of its production employees, are in the U.S.A.

• Every Mag Instrument flashlight, no matter where in the world it ends up, comes from a factory located in the U.S.A. and staffed by American workers.

Why Mag Instrument is against "outsourcing" of flashlight manufacturing jobs: It's a curious thing: While its competitors in the flashlight industry are busy exporting manufacturing jobs from the United States, Mag Instrument is busy exporting flashlights from the United States.

Why? The answer, again, comes down to one man's abiding commitment. To "outsource" flashlight manufacturing jobs -- to take those jobs away from American workers and send them "offshore" -- would violate Tony Maglica's philosophy in several ways.

For one, it would offend against his faith in the American free-enterprise system, and against the spirit of giving back. Mr. Maglica knows that Mag Instrument got where it is by being an American company. And he deeply believes that Mag Instrument could not have happened anywhere but in America -- that nowhere else but in the U.S.A. could somebody who started with as little as he had ever build from scratch a company such as Mag Instrument has become. He also understands the importance, for the well-being of the people of this country, of encouraging entrepreneurship and maintaining a vibrant industrial base. That is why he is proud to be counted as a leader in the current renaissance in American manufacturing. And it is why he has dedicated himself to proving that U.S.-based manufacturing can excel in the global marketplace by using technology to continually improve quality and reduce costs. It is also why Mr. Maglica has been as active as he has in efforts to ensure a "level playing field" for American manufacturers.

To "outsource" flashlight manufacturing jobs would also offend against Tony Maglica's commitment to quality. There is a reason, he believes, why Mag Instrument has been able to maintain its world-renowned product quality, while holding costs low enough so that Mag never once, in its quarter-century history, has ever had to raise its price to its customers. That reason has to do with his personal vigilance, which requires all of Mag's flashlight manufacturing to be kept in one place, a place where he can personally watch it happen. His approach to continuous product improvement entails walking the factory floor -- observing, teaching, listening to suggestions, praising what is done right and correcting what is not, constantly handling and inspecting product as it is being manufactured, nipping quality problems in the bud, being on the lookout for any small way to further improve efficiency, avoid bottlenecks, or cut waste of time or materials.

Mag Instrument's kind of continuous quality improvement needs to be practiced up close; at a distance, it just would not work. Mr. Maglica knows the difference between good quality and great quality, and he knows what makes that difference -- an abiding commitment to real, true product excellence. Further, he understands that quality is not a goal but a process; not an endpoint but a dogged, relentless pursuit -- all day, every day.

To "outsource" Mag's flashlight manufacturing, to move it to a place where Mr. Maglica could not personally watch it happen, would in his view put cost control and quality at too much peril. To do that would be to risk the end of excellence.

WHAT IT MEANS TO BE "A U.S.A. MANUFACTURER"
To say that Mag Instrument is "a U.S.A. Manufacturer" does not mean that the company never imports anything. As is typical in manufacturing a product of any complexity, and as common sense would suggest, not all of the components that go into a Mag® flashlight can practicably be made in Mag's own factory. For example, Mag Instrument purchases from an outside vendor the Lexan® discs that, during the assembly process, are incorporated as lenses into Mag® flashlights. Nor are all items that are packaged with Mag's flashlights made in-house. For example, Mag does not manufacture batteries. The batteries it sometimes packages together with its flashlights are purchased from outside vendors. The same is true of the nylon and leather holsters and wrist lanyards that are offered as accessories to Mini Maglite® flashlights. Although it can be necessary, from time to time, for Mag to purchase a flashlight component or accessory that is made overseas, Mag's flashlights themselves are always made in Mag's own factory in the U.S.A., and it is Mag's policy to give very strong preference to U.S. vendors, dealing with domestic sources whenever feasible. Purchases of imported items are limited to those situations where the items in question cannot, consistently with Mag's quality and performance requirements and/or its needs for steady, dependable supply, be practically met by any known domestic source. Even in these instances, Mag Instrument works to develop and cultivate domestic sourcing, and has sometimes taken an operation in-house to avoid reliance on a foreign-source of supply.

So when Mag Instrument calls itself "a U.S.A. Manufacturer," what is meant is that its flashlights are made in the U.S.A. -- in a U.S. factory, by U.S. workers -- even if some components might sometimes have to be imported.

STRENGTHENING AMERICAN MANUFACTURING -- HOW MAG INSTRUMENT GETS INVOLVED
Mag Instrument is the only flashlight company with significant market share that still manufacturers its entire line of flashlights in the United States. Unlike its competitors, Mag Instrument has chosen not to outsource the manufacturing of its flashlights to foreign countries in order to take advantage of cheap labor and less stringent environmental standards, which may also result in inferior quality.

The outsourcing of manufacturing by other U.S. companies has caused hundreds of thousands, if not millions, of jobs in the United States to be lost. Indeed, if Mag Instrument had chosen the path of other flashlight companies, the jobs of its approximately 800 employees in Ontario, California would have been lost.

Mag Instrument believes in "free trade" but free trade must also be "fair trade" to ensure that there is a level playing field for all of the trading partners of the U.S. This includes trade agreements that contain provisions related to product quality, consumer protection, intellectual property rights, fair labor code, employee dignity, safe working conditions, safeguarding of natural resources, environmental protection, and elimination of unfair trade barriers that impede the free flow of goods and services. Mag relishes the competitive nature of a free and fair global marketplace and believes the U.S. can compete with any country in the world given these conditions.

By keeping flashlight manufacturing jobs in America, Mag Instrument "puts its money where its mouth is." But when it comes to promoting U.S.-based manufacturing, Mag Instrument does much more than just set a good example. Here are a few of the company's involvements:

  • Mag Instrument is a sustaining member of the Manufacturing Coalition. This nationwide, grass-roots organization (more at www.manufacturingcoalition.com) works to support and grow American manufacturing.
  • Mag Instrument is an executive member of the California Chamber of Commerce. As such, Mag has consistently raised its voice against "job killer bills" that would handicap California-based manufacturers, and in favor of legislation aimed at keeping the state's manufacturing businesses healthy.
  • Mag Instrument has lent critical support to the Independent Business Coalition. This organization has spearheaded efforts to expose, and remedy, the devastating effect that the state's badly broken worker's compensation system has had on California's manufacturing businesses.
  • Mag Instrument loyally supports the City of Ontario Chamber of Commerce.
  • Mag Instrument frequently corresponds with government officials on manufacturing-related legislative policy. Upon the topics on which Mag has spoken out are tax measures to encourage the health and growth of American manufacturing, such as manufacturing tax credits, the reform of the depreciation rules relating to manufacturing facilities and equipment, and the preservation of "Subchapter S" tax status for the companies of successful manufacturing entrepreneurs.
  • Mr. Maglica is frequently invited to speak, give interviews and participate in conferences on U.S. manufacturing trade, tax and regulatory policy including topics such as: Intellectual property rights; investment tax credits for U.S.-based manufacturing; maintaining a "level playing field" in international trading relationships involving the United States; a jobs tax credit for U.S. manufacturers; and a tax credit for export sales by companies who do their manufacturing in the United States. Mr. Maglica is often approached for comment by magazines that focus on business, economic development and manufacturing.
  • Mag Instrument advocates strong intellectual property rights. A key ingredient in any successful formula for maintaining a strong manufacturing base is robust legal protection for the intellectual property that innovative and entrepreneurial companies create. Here again, Mag Instrument gets involved -- not only in the arenas of government and business but also, when necessary, in the courts. Tony Maglica is personally involved in all product research and development, and Mag Instrument holds hundreds of patents and trademarks for features that are employed in company products. Over the past decade and a half, Mag Instrument not only has vigorously advocated for strong intellectual property rights but also has vigorously enforced its own intellectual property rights, in courts here and abroad, against those who would "knock off" its successful products by imitating their trademarked appearance features, infringing the patents that cover them, and appropriating the company's secret and proprietary plans and know-how. Mr. Maglica believes that all American manufacturers benefit from the aggressive defense of intellectual property rights against any and all infringers.


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