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Portion Control

Thinking about manufacturing offshore? Consider the cost of quotas first.

By Tomima Edmark

Opinions expressed by Entrepreneur contributors are their own.

You can't pick up a newspaper today without reading aboutone company or another making the decision to manufacture itsproducts offshore. Pricing in the marketplace has become a kind ofbidding war, and many businesses are finding that to compete, theymust shop for foreign manufacturing alternatives. If you decide youwant to manufacture your product offshore, however, you may have tofactor in the cost of an import quota.

The idea of placing quotas on the amount of goods that can beimported into the United States is not new. In 1792, AlexanderHamilton sponsored legislation to institute import quotas thatserved to protect infant American industries and allow them tomature rather than face defeat by imports. Since then, some type ofquota has always existed in this country. Today, the vast majorityof import quotas are found in the textile and apparel industries,although quotas on other import items, such as tuna, cheese andsome types of watches, also exist.

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