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Lenovo's North Carolina Onshoring Effort: One Year Later

Lenovo's President of North America gives an update on the company's bold reshoring efforts, returning U.S. high-tech manufacturing jobs to North Carolina plant.

It's been one year since Lenovo opened up its first computer manufacturing plant in the U.S., where it makes laptops, PCs and tablets sold under the Think brand.

The plant, located in Whitsett, N.C., created initially 115 manufacturing jobs in the state. The plant acts as mostly an assembly plant for Lenovo, supplementing plants in Mexico, Brazil and China.

Since the opening of the plant in October 2012, Lenovo says it has added more North Carolina positions to Lenovo, including call-center jobs, logistics, refurbishing center and a returns team. The jobs, Lenovo said, are split between Raleigh, Whitsett and Morrisville, N.C.

CRN sat down with Lenovo's President of Lenovo North America, Jay Parker, and asked him for an update on his company's efforts to bring back jobs to the U.S., and what that means for channel partners and business.

CRN: It's been a year since Lenovo opened its computer assembly plant. How has the initial rollout been?

Parker: We're a leader in this area. We believe we have started a potential trend. It's been very successful for us so far. We opened [the Whitsett plant] in January and got up to full capacity in June. We have about 300 employees at this facility. About 115 jobs are manufacturing and the rest is logistics services, and refurbs and returns.

CRN: Any surprises in the first year getting things off the ground?

Parker: The plant ramped up just like we wanted. The labor pool was better than expected, and our ability to hire skilled workers was excellent. We are not only producing notebooks and desktops, we are now making servers and Thinkpad Tablet 2s.

CRN: Will you expand your manufacturing to include more products, and will you hire more people?

Parker: Right now we are only doing Think-branded products but certainly wouldn't rule out consumer products. As long as our business continues to grow 10 to 20 percent every quarter and year, we are happy to expand in size, but also in breadth, of what we manufacture.

First of all, it's still more economically viable to manufacture overseas. That gap has not closed. But it has shrunk. So labor costs differences have shrunk. Logistics cost differences have shrunk. And so the gap is no longer as large as it once was. It is no longer as great between the U.S. and China and other countries that are manufacturing bases.

So now we can make a business case that says, because of the advantages I get, it is worth the competitive advantage and the customer advantage. Manufacturing here in the U.S. is worth the smaller incremental costs in bringing manufacturing to North Carolina. What we said -- at least on a small scale -- is it's worth taking the risk.

NEXT: Why should partners care about Lenovo making Think products here in the U.S.?

CRN: Why should partners care about Lenovo making Think products here in the U.S.?

Parker: They do. It's given us a few advantages. For example, I can do last-minute configurations and point-of-sale type changes to the order. It's more flexible. I can put asset tags on systems, I can put images on systems, I can engrave the back right at the last moment.

But here's why Lenovo partners care. I can get the product to you fast. If you are a channel partner that doesn't want to carry inventory and I tell you, 'Hey, this order doesn't have to be on a boat or even on an airplane from China. It's coming from North Carolina this afternoon and it will be to you in two days.' That's a big deal and that's an advantage to this model.

CRN: Have you been able to bring any other Lenovo jobs related to system manufacturing back to the U.S.?

Parker: Onshoring is not just manufacturing. In the April time frame, we moved our consumer service hotline from Bangalore, India, to Raleigh, N.C. If you buy a consumer product on our website and you call in and want to know where your order is, now you are getting somebody in Raleigh.

Our customer satisfaction in a period of 30 days from April to May went up by 25 percent. That was a multimillion-dollar investment that we made, hiring 150 people, specifically for the purpose of customer satisfaction. And we believe it is paying off.

It's not only about products and product design. It's our willingness to invest our entire sales experience. We believe our North Carolina presence can help us grow that gap with our competition and make being 'Made in the U.S.' a differentiating factor.

This report originally appeared on the CRN Tech News App for iOS and Windows 8.

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