How Sourcing Pros Navigate Overseas Contract Manufacturing Amid Trade and Tariff Uncertainty

For many US OEMs, overseas contract manufacturing offers cost advantages and access to advanced capabilities. However, sourcing directly from overseas suppliers can also introduce challenges ranging from large minimum order requirements to limited customer support to uncertainty about the tariff bill. At SIG, we bridge that gap by providing US-based support while offering global sourcing solutions.

A Customer Example: Moving Beyond Direct Sourcing in China

One of our customers, a midsize lighting OEM, had been working directly with a supplier in China for a mid-volume printed circuit board assembly (PCBA). Although this supplier had a US sales office, the support provided was limited. The customer faced two major issues:

• They were required to purchase very large volumes at once, often committing to their entire estimated annual usage (EAU) in a single order.

• The supplier offered little flexibility or ongoing support to manage inventory and logistics.

  
  

On top of these operational hurdles, the customer was also exposed to tariff uncertainty and geopolitical risk tied to China sourcing. Every shipment carried an unmitigated risk of unexpected duties or policy changes that could erode margins overnight.

When the customer approached SIG with a request for quotation (RFQ), we delivered a solution that addressed their pain points and reduced their exposure to risk.

How SIG Made the Difference

Global Options with Transparent Pricing Instead of presenting a single-country option, our quote included pricing from two trusted partner factories—in this case both China and Malaysia. This gave the customer flexibility to choose the best sourcing path based not only on cost but also on risk diversification. By sourcing from more than one country, the customer gained a hedge against future tariff changes, supply chain disruptions, or regulatory shifts.

US-Based Stocking Program at No Extra Cost SIG proposed a stocking program from our New York warehouse. We stock up to one year’s worth of inventory on behalf of the customer and ship/bill only against release orders. This eliminated the need for the customer to purchase their entire EAU upfront, improved cash flow, and reduced inventory risk—all without additional charges. The stocking program also provided a buffer against delays at ports or sudden tariff adjustments, giving the customer certainty of supply.

Dedicated US-Based Support Unlike overseas suppliers with limited availability, SIG’s US-based team provides attentive customer support. We are on call, ready to resolve issues, coordinate logistics, and ensure seamless communication. Our customers know they have a partner close to home who is accountable and available.

Vetting, Managing, and Underwriting Overseas Factories

A key part of SIG’s value is the confidence we give US OEMs in their supply base. We do not simply connect customers with overseas suppliers—we vet each factory, manage the relationship day-to-day, and underwrite performance. This means that:

• OEMs can trust that the factories we work with meet rigorous quality and capability standards

• SIG monitors production closely, addressing issues before they become problems

• Performance accountability rests with us—we stand behind the commitments we make to our customers

By underwriting the performance of our overseas partners, SIG removes a major source of uncertainty and gives OEMs peace of mind that their global supply chain is being actively managed and protected.

Why It Matters for US OEMs

Working with a US-based service like SIG allows OEMs to capture the cost and capability benefits of overseas manufacturing while minimizing the risks of direct international sourcing.

With SIG, US OEMs gain:

• Global sourcing options to balance cost, tariffs, and supply chain risks

• Flexible stocking programs that strengthen cash flow and mitigate exposure to disruption

• Dedicated customer service from a US-based team that understands the local business environment

• Confidence in vetted, professionally managed overseas factories with performance underwritten by SIG

  
  

In today’s environment of tariff uncertainty and shifting trade policy, relying on a single-country sourcing strategy leaves OEMs vulnerable. By partnering with SIG, OEMs can diversify their supply base, mitigate risk, and build a stronger, more resilient supply chain.

At SIG, our mission is to simplify overseas manufacturing for US OEMs. We provide the expertise, infrastructure, and support needed to make global sourcing efficient, flexible, and dependable.

---

Ready to Strengthen Your Supply Chain?

If your business is looking for a smarter way to manage overseas contract manufacturing, SIG is here to help. Our US-based team will give you options, flexibility, and confidence while reducing the risks tied to tariffs, trade policy, and supplier performance.

Write us at info@sigsourcing.com to start the conversation and see how SIG can help your company build a more resilient and cost-effective supply chain.