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The Outsourcing of Industrial Design Services by Large US Manufacturing Companies

Author

Listed:
  • Alan MacPherson

    (State University of New York at Buffalo, Canada-U.S. Trade Center, Buffalo, New York, geoadm@buffalo.edu)

  • Vida Vanchan

    (Department of Geography and Planning, Buffalo State College, Buffalo, New York, vanchav@buffalostate.edu)

Abstract

This article examines the extent to which US producers of durable goods outsource design and development work to external organizations. Evidence from a sample of sixty-eight large manufacturing companies suggests that independent design consultancies and other design service vendors contribute significantly to the product development efforts of major corporations. External organizations are increasingly expected to deliver innovative design solutions with respect to materials selection, aesthetics, ergonomics, product performance, and ease of manufacture. These vendors vary from single-person establishments to firms that employ over 500 people. We find that the outsourcing of industrial design has been driven primarily by the ability of external companies to offer innovative services that complement the core competencies of client firms. Our data also point to the rising importance of design service imports, notably from the United Kingdom, France, and Italy. Such imports currently account for about 35 percent of externalized design expenditures, compared to less than 15 percent ten years ago.

Suggested Citation

  • Alan MacPherson & Vida Vanchan, 2010. "The Outsourcing of Industrial Design Services by Large US Manufacturing Companies," International Regional Science Review, , vol. 33(1), pages 3-30, January.
  • Handle: RePEc:sae:inrsre:v:33:y:2010:i:1:p:3-30
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    Cited by:

    1. Martin Falk & Fei Peng, 2013. "The increasing service intensity of European manufacturing," The Service Industries Journal, Taylor & Francis Journals, vol. 33(15-16), pages 1686-1706, December.
    2. Castellani, Davide & De Benedictis, Luca & Horgos, Daniel, 2013. "Can we really trust offshoring indices?," Structural Change and Economic Dynamics, Elsevier, vol. 25(C), pages 159-172.

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