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Your Business First


Huge dependence on product components from low-wage countries calls for a rethink


As a result of the coronavirus outbreak, many companies are faced with late deliveries of goods from China, among other countries, with major consequences for these companies and the Dutch economy. That is why now is the time to bring production back to the Netherlands. This is also where the R&D, sales and administration departments are located.

In recent decades, many Dutch companies decided to relocate their production departments to places like China, because of the attractive wages in these countries. Now they are experiencing the unpleasant consequences of this.

Even the lack of a small part of a finished product can lead to huge delays in the production and sales process. The impact of this is just as great as if the entire product were manufactured in China. 

This tremendous vulnerability is calling for a rethink of the situation. Especially when combined with existing issues such as product quality, working conditions and the protection of intellectual property in the production processes over there.

Major developments in the field of automation also mean that it is no longer necessary to outsource production to low-wage countries. Moreover, by bringing production back to this country, companies can once again start to innovate the production process themselves.

The fact that this type of important innovation is currently taking place in countries like China, means that the knowledge of Dutch businesses is being diluted.

The renewed innovation that will come about as a result of a company carrying out the production process itself can be protected under patent law exclusively for the company, or the company can carefully keep this know-how to itself.


This article was also published in The Financieele Dagblad on 20 March 2020.

Topics: Design Rights, Intellectual Property