Why You Should Manufacture In The U.S.A. with Expert Jason Azevedo

David 0:00
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Jason Azevedo 0:46
Trying to find a balance of a young workforce that kind of is coming in with the freshest and really not knowing what they’re looking for. And then pairing that with craftsmanship of the older side of the workforce that they’ve seen it all and we’ll be able to help find the pitfalls. How much easier is it to find a sourcing team that’s going to work on a time window that is similar to what their the rest of their family does, versus Oh, good at 7:30at night, every night I started talking to China, I’m done talking to them about 3:30 And then I’m gonna wake up like so. There’s quality life that goes with it to

Intro 1:23
Welcome everyone to the firing the man podcast a show for anyone who wants to be their own boss. If you sit in a cubicle every day and know you were capable of more then join us this show will help you build a business and grow your passive income stream in just a few short hours per day. And now your host serial entrepreneurs David Schomer and Ken Wilson.

David 1:47
Welcome everyone to the firing the man podcast on today’s episode we have the privilege to interview Jason as a Vito Jason has had his heart in business development since an early age starting a very successful apparel company that he grew from his humble beginnings in a garage to an annual gross billings of over a million dollars by age 15. By age 18, Jason was doing millions in business with Starbucks, Nike, Disney Marvel, Volkswagen, Audi Lucasfilms, dodgers, and countless NBA teams. In 2009. Jason, co founded at voc, one of the only US based manufacturers located in Silicon Valley, California. His emphasis on Made in America is a driving force for how the various companies he’s co founded operate. Jason has worked on many key projects for companies such as a recent networks Best Buy Costco, Disney EA games, Intel, Roku, Starbucks, Target, Walmart, and Warner Brothers. Rounding out the intro with a few of Jason’s personal hobbies, he likes to ride dirt bikes, quads, beach volleyball, and whiskey tasting. Jason, we’re really excited to have you on the show. And to start things off, Barney, tell people a little bit about yourself and your background?

Jason Azevedo 3:03
Well, first off, thanks for having me, I’m really excited to hang out today, my backgrounds different than the regular path, it’s like you mentioned I started my first company 15 years old, we, I was a sophomore in high school and thought, you know, it’s a great idea. Let’s get into it. Let’s get into the relevance and how is that going to function. But I also kind of have to set the stage of the moment in time. And the factors that are coming together for this. I grew up in a factory, that house my father were graveyard, 2829 years for the same company in a manufacturing plant. And that company was the epitome of what you think of as a bad manufacturing job. The management was, frankly, constantly at the throat of the manufacturing level employees. It just wasn’t a healthy environment. Now, granted, that was one of the most profitable plants in the country for the company that my father worked, but they still laid off all the employees in the final six, seven years you worked there, just about as many times. So my brother and I grew up seeing that. And we when we started our first manufacturing company, it was a huge point of ours was we It didn’t have to be like that. We believe that there’s a way to go into manufacturing and truly bring it back to what it was when it was in its heyday and kind of the strength in that that development. So we started an apparel company. And it was interesting because we started it in February of 2007. Well, here comes the end of 2007 and early 2008. And everybody knows what suddenly happens to every market in the country. And everybody’s telling us is not the time to start a business. It’s horrible. It’s you guys don’t know what you’re doing. You’re not gonna get clients, everything under the sun. There’s just everyone’s telling us it’s gonna be horrible and we’re just gonna fail. And one person messed up. I distinctly remember the conversation and they go, you’re gonna lose everything you and it took me aback because you gotta remember I’m 15 years old. I have $600 Like, what is this person talking? About, and it clicked that what it was, it was every person around us telling us why they weren’t doing it, why they hadn’t done it, why they were afraid. And none of it had to do with us. We were young, stupid kids that we had nothing but energy and drive. So we just decided to jump into business. Well, a down economy does something really interesting. And well, we learned by fire, all of a sudden, all the equipment to do manufacturing is now pennies on the dollar, because people are going to business left and right. And giant clients that you never would have been able to get into as a small company, their manufacturer had just suddenly gone defunct, because they were having cashflow problems, but they still have orders they need to fill. So you’ve got these massive clients that people would kill to get into that we’re getting into, because they just they’re trying to find out where to go. And the world’s changing and they want to be a big fish to anyone they go to because they want to be able to ride the storm with that. So we started collecting these great clients and great opportunities, surely built out of what everyone was telling us was going to fail. So it was a very just different moment in time where you learn business at what everyone else was says the worst time and we till this day argue is the best thing that ever happened to us.

Ken 6:19
That’s awesome. And and that’s a like, super powerful story to like at 15. Playing, hey, I’m going to, you know, everybody telling you not to do something, and then you’re you know, you go decide to and a lot of this, what you said makes sense. Like, you know, market downturn, everything is going away. And it’s a perfect opportunity for someone that wants to come in and solve problems and be nimble and pivot. So that’s awesome. So Jason, your background, a little is in manufacturing. Right? So manufacturing expert, let’s get into, you know, probably back towards when he started, kind of what’s the history?

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Jason Azevedo 6:52
Yeah. So there’s a stigma that comes with manufacturing where everybody thinks it’s old. And anybody who’s not in the space has this mentality that for some reason, manufacturing plants in their heads are still Charles Dickens with dirt floor and machine grease flying everywhere, people’s arms getting ripped off. And that’s not the case anymore. It’s the frankly, factories have come a long way, especially last 10 years, when we started, our primary focus was people for how do you build plants that you can take care of people and frankly, add in the tools to make the people more effective. So that was a huge core focus of ours, really building off of a lot of what Toyota had done in kind of in the late 80s, early 90s. Really a lot of the lean manufacturing ideas, but then taking it to that next level of how do you use that, to make the most effective workforce you can, and the most and also to change have the ability to have iteration. Because nowadays, one of the most important things in manufacturing is your ability to iterate on the same design. Because products are ever changing. They’re they’re very difficult, it’s very often that the same product stays the same product for any significant period of time anymore. There’s constantly adjustments being made. I’ll give you kind of an example. I’m very fortunate on my team, I have a lot of earlier Tesla employees. And what the till this day are on the test of production lines, during breaks, the engineers are sitting there waiting because they want to go measure things on the cars. And hey, we might make that change on this flange. And it’s happening almost in real time during production days. So we’ve spent a lot of focus on how do you maintain that ability to produce a consistent good product, but also how to iterate and how to keep up with the times and flow. And there’s a good combination of technology and many and automation and skill set training that we work with our people to make sure that they’ve got all of those things added up to really have a the best fighting chance to move forward.

David 9:00
Okay, very nice. I yeah, that’s an interesting story about the Tesla employees and them chomping at the bit to get back so you know, as part of manufacturing supply chains is a big topic and so can we talk about your experiences with supply chains in 2020? Excuse me 2022 And yeah,

Jason Azevedo 9:19
so I believe that you’re going to see a regionalization of supply chains again. I think like any pendulum play the world manufacturing market and world supply chain market went from super super isolationist say 5060 years ago to everybody decided to go to the other direction with the pendulum and go super global base let’s go after the lowest wage workers what it really kind of broke that chain and I think you’re gonna see a balance come back and you are seeing it happen already. Where a regional sets of manufacturers that are closer to the final consumer and cut down on shipping costs cut, really have a better insight to the local consumer provide jobs in that region so that you can create your own internal consumers. I, that’s really what we’re starting to see this next phase. And one of the big, important things that’s happened is for about 2030 years ago in the manufacturing space and the supply chain in general, the low cost labor was the primary driver of why you’d manufacture most products in a certain place or another. And with the, frankly, the technological boom, that has been the last 10 to 15 years, the manufacturing space has also seen that same boo. So what you’re starting to see is now you don’t have to go chase the lowest wage, you actually are looking for the most competent worker, the most competent workforce. And that usually provides a really good positioning for American manufacturing, because we can have more skilled more well paid more well taken care of employees doing functional jobs, because the automation is making the effectiveness and taking part, taking out the monotony of what you’d normally dive

David 11:04
in on the people side of things. And for those of you that are have listened to our show, you’re probably well aware, we started a manufacturing facility in 2021. And our what we’re finding is that the right people make things a lot easier. And so do you have any pro tips on where do these people hang out? How do you find?

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Jason Azevedo 11:23
Okay, so there’s a couple of things. First off, manufacturing is a people business every industry tries to say it is there’s no industry that as much as as much a people business as manufacturing, it is it’s a special world because, frankly, so much of it has to do with manuals and craftsmanship. And really, how do you dive in there, we like to have a healthy balance of people that we’ve built ourselves. And, frankly, that way we can instill the values and the focus that we like, also, taking into account the trying to find a balance of a young workforce that kind of is coming in with the freshest and really not knowing what they’re looking for. And then pairing that with craftsmanship of the older side of the workforce that they’ve seen it all and we’ll be able to help find the pitfalls. And really, it’s a blend. So I hear a lot of people with manufacturing teams that they’re I’m looking for this type of person, it’s like, nowhere, it’s really successfully seen our history has been how do I combine somebody who might be jaded and very stuck in their ways, and combine them on a respect level with somebody who wants to change everything and believes that they have all these great new ideas, and get those two people to respect each other enough to listen to each other and to work together. And then that’s what gives you that blend of forward progress. But also the infrastructure, the stability of a new plug a new plan.

Ken 12:53
Yeah, that’s super interesting. I definitely agree. Like, it’s definitely a people business. I mean, they’re the sole kind of the lifeblood of getting everything done. Right. So Jason, like kind of moving on, like I in the last say, I don’t know, two or three decades, it just seems like manufacturing, at least from my view is like, everything is like has kind of offshored everything, you know, EPA, there’s all these rules that comes up and it’s cheaper elsewhere. Like you alluded to earlier, labor hours, you know, there’s certain parts of Asia that labor hours are super, super cheap. And so we’ve offshored a lot year over year for the last few decades, manufacturing to China, mostly, and other a few other countries. Now, I think COVID was like it was like a significant like blip on the radar, everything shut down. And we realized, like here in the US, we realized, like, we couldn’t get like masks, we couldn’t get there certain things we just we couldn’t get and it was oh, wow, this happened. We’re kind of single threaded here. We’re relying on other people COVID Since you know, spin into decline. And I think there’s suspend this new energy in manufacturing. Can you kind of speak to that a little bit like revitalizing manufacturing?

Jason Azevedo 14:03
Yeah. So you hit on something that is incredibly important, and that is COVID effects on this. So for the last 10 to 15 years, a fallacy has been being accepted within the US. And that is that it is automatically more expensive to produce in the US are automatically cheaper to produce in a low wage country. If you went back 2530 years, you’re correct. The reality is we the American manufacturing infrastructure, was doing things the way they’d done it for 4050 years. And then all of a sudden, an extraordinarily low wage. Country comes online. And they couldn’t compete one to one. It’s simple as that. So it became cheaper to produce offshore. But where the fallacy comes in, is that people are still thinking that way. Even though we have had the most incredible technological Advances in the last 15 years. And we see them in every other industry. But for some reason people don’t correlate that with the manufacturing industry. When I was high school, ever, my teachers always told me you have to learn how to do math on paper, because you’re not going to have a calculator in your pocket every day. Well, my teacher was wrong.

Ken 15:19
Like, don’t tell my son. But

Jason Azevedo 15:20
this half this is happening every. But this happened to everyone it happened to manufacturing industries to is things got easier, we needed less monotonous labor hours. So the concept of we’re fighting labor, our labor hour isn’t true anymore. Because the automation in a low wage country and automation in the US, they produce the same thing. So now you’ve got transportation costs, you’ve got opportunity cost of having a lot of product out. And companies started to realize that. But nobody, everyone was afraid to test it. Every years ago, Apple had written a report that they could under certain structures, they could produce the iPhone cheaper in the US than they could in China. And there were a couple of barriers to entry that everyone was afraid to test it, it needed a catalyst for people to be forced to test it into COVID, the world start shutting down. And you’ve got supply chain managers who have been looking out the corner of their eye going this is possible. I think it makes sense to go in the US, but nobody that everyone was afraid to test. And then all of a sudden, the world told him, You must test this idea. And they started testing it. And they’re like, Wow, it actually worked. Hey, this is fiscally responsible. In addition to that, one of the scariest things is the last people to catch on to it are American entrepreneurs. We at Congress bought a facility in Ohio to help build the Fisker. I mean, that that is the premier Chinese contract manufacturer. And they’re going you know, now we’re gonna build those parts of the US, I just think about. So we’re starting to see a lot of other countries come in and go, Oh, yeah, this makes total sense, we’ll probably build a plant here. And it took COVID for a lot of people to be forced to look into it. And as soon as they looked into it, started going, Wow, this is actually penciling out, Hey, I’m getting my life that my engineers love it, because instead of working all night to talk to foreign sources, they’re just going to a plant in Indiana, and looking at what’s being done. So that really that moment in time that COVID created was really important. And we had been saying it for years that it was going to take something to finally make people realize no, and we always thought it was gonna be some major corporation that decided to try it and it worked out. Well come to find out it was the world’s stopping for a year.

David 17:45
Absolutely. I you know, we’ve said it on here before, but manufacturing in the USA will always be in style. And it’ll always be cool. It’s just, it’s just something that, you know, I when Ken and I talk about what we do, one thing we almost always bring up is our manufacturing facility, because it’s cool. We’re making stuff here. It’s awesome. And so I’m going to make a statement right now. And I’ll let you know, I don’t agree with this. But I’d like you to take the other side of this. And that statement is I’m a person on fixed income. And I am buying, say like a baby product online. And I can buy it from a USA manufacturer for $25. Or I can buy it from a Chinese manufacturer for 15. I am I do like supporting things that are made in the USA. But given my fixed income, I’m going with the lower priced option. Can you take the other side of that?

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Jason Azevedo 18:38
Well, I think there’s the there’s a fallacy and the premise. Why automatically is the foreign thing cheaper. That isn’t the reality anymore. The reality is, oftentimes when something’s more expensive, because it’s made in the US, it’s because it’s a marketing game, you can charge more, it’s an American made product, but that the numbers have lined up on a P&L over the over the past 10 years. But there is still something premium to be said about its American made. I will tell you a lot of products that boast American made are made in the same factory with products that don’t boast American made. So you might actually be buying the product without even knowing you’re buying. In addition to that, there is something about American products that have a warranty that goes along with it and they stand by and there’s something to be said about that is you I know a lot of a lot of your listeners are very Amazon the difference between calling an American supplier and calling a foreign supplier with pay half of this product is scratched coming in your response rates just a little bit higher on the domestic side. So really, it’s understanding that but there’s a huge problem with just the concept of villains automatically too. because it might be foreign, that’s just not something it’s a really

David 20:03
good point, and definitely a fallacy with it. Within that statement, I am sure there are somebody listening this podcast, who is sourcing from China, and you’ve talked about kind of penciling it out. And so when someone is going through this exercise, do I source foreign? Or do I make it domestic? What are some of the things that they should be penciling in, like shipping is the obvious one, but like, what are some other things, shipping tariffs,

Jason Azevedo 20:27
I mean, all of that makes baseline sets, one of the big ones is carrying cost. So you’re gonna buy 50,000 products? Well, you’re going to, if you place an order for 50,000 products, that and we’re going to use China for the fun of it, you are going to put 50% down, no matter what you’re going to wire them that to start the order, however long it takes to run that order, they’re going to hold 50% of your money, before they will even look at writing a bol or putting it on a container, you’re going to wire them the rest of the money, because there’s not going to be terms on the on these things, then you’re gonna put them on a boat, because you really don’t want to put them on the airplane and get them in five to seven days, because you’re gonna eat up way too much shipping. So let’s say you put on boat. So now your weeks without knowing if that product you’ve bought is good, you’ve got the carrying cost of all that, that product, whether you’re using line of credit to hold that note, or anything else, you now your cash flows messed up, because you can’t release consistently enough, then you’ve got all this carrying costs, gets you now if there’s an issue, because there’s always an issue, and this is whether you’re domestic or you’re for wherever you’re sourcing from you’re gonna run into. So now how many weeks to correct that issue? Because it’s been on the water for three, four weeks, they got stuck in the Port of Long Beach for another two or three? And then okay, well, we needed to correct it. So it’s a rebuild. What did that do to your Amazon listing, because you actually have an add product that can be sold on it. And now 12 weeks, by the time you get something in there. So that damage ratio is there. And the reality is, if you look at what Tim Cook did at Apple, really what his he was the one who brought Apple’s supply chain to the next level, he took their on hand inventory, using foreign sources still, the he took their on hand inventory for months to six days, because that carrying cost was such a dangerous, dangerous cost for the company. So he shortened that as tight as he could. Well a lot of people when they’re looking at stuff just on penciling, they’re not looking at all the risks that you’re adding in by having these massive carrying this. The next one is iteration. If you’ve got a product that you’re adapting, changing, you’re responding to Amazon reviews, you’re responding anything else, that time to make sure that you’ve got that next iteration there the most, the more you can shorten that up, the more you can get to a product that can sell faster. So it cuts down on that marketing and development spending. Of course, damage ratios are very important. Eight, take even the iPhone, if you look up the stats on how many iPhones are bricks and have to be returned, a year is unbelievable. You’re still sitting at three to 7% at their level. It’s just It’s crazy. So really, you need to look into all of that with of stuff. But then we go back to your people to say you’ve got a sourcing team. How much easier is it to find a sourcing team that’s going to work on a time window that is similar to what they’re the rest of their family does, versus Oh, good at 730 at night, every night, I started talking to China, I’m done talking to them about three 330. And then I’m gonna wake up, like, so there’s quality life that goes with it, too. So really, it’s taking a broader view of it. Now, if you’re trying to get into the commodities business, and while I’m gonna buy this one thing, 5000 of them, I don’t care about the quality, put them up hope they sell and move on. Okay, maybe you start going, you start simplifying it. But if you’re truly building a business out of it, you got to look at all of the costs and the opportunity costs and the carrying costs. Those kind of things are where things really get crazy.

Ken 24:15
There’s a lot of good points and yeah, some of them are, you know, you don’t really think of like or you don’t like compare apples to apples, like the carrying cost and the cash flow. That’s something you really don’t I think it’s at least for me, like on paper, it doesn’t hit you until you’re in that process until you need that cash to buy a second order and then you’re like, I don’t have any cash. Right. And so those are all really good points. You know, if you’re looking at pros and cons, so those are awesome. Yeah, looking at from a 10,000 foot view.

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Ken 25:37
Now, so if everything is so like American manufacturing versus China, let’s just stay on that. How can American manufacturers kind of keep up with Chinese manufacturers? You know, given that let’s say everything was equal, like how do we compete with them,

Jason Azevedo 25:52
I never looked at it as US versus that there is so much work to go around. You don’t need to compete. If you can manufacture in the US you can keep efficient every person I talked to so backlogged assembly. And the reason being is we’re consuming faster, they’re just surely are not enough people making things to keep up with how fast this world wants it. And frankly, you look at like developing economies like China, or like the India, they’re starting to consume all of their own products. Like at some point, you just need to make more you take, you take a razor, go back 20 3040 years, people would actually sharpen razors. Now we have four blades on a razor, we use a one time throw it away, because it’s disposable, get another one. So you take something that may have lasted you for years, now we’re using one every day. So it’s the consumption rate is drastic, I think it’s something that’s hard for Americans to understand, because we’ve been consuming a lot for a long time. But as other developing economies are coming online, you’ve got a world of people who were at the lower end of consumption. And they’re starting to move up the ladder. And they’re they’re starting to get more products to them. And we’re not ready to feed all those people with products. So I never looked at it as hey, it’s us against them or the in there are certain things that make more sense to make in other regions. I’m all about regional manufacturing, make sure it’s local community in the US, because that’s what I understand. But there are things that make sense to make in other places, and I can simplify it like, hey, maybe wooden clogs, the US isn’t the number one place to make and sell those, there’s probably a couple other countries that make more sense. So it’s really, it’s understanding what makes the most sense in that region. And if you look at it that way, there really is never a hey are fighting to grow. Pretty much every customer of every major American manufacturer, as long as they’re good at what they do, is begging them to produce more stuff. Because right now the US consumes the most products, so you’re going to want to make them as close to the people consuming.

David 28:08
Let’s dive into raw materials and sourcing those. And I, my question and I’m gonna give a little background on this is, what types of materials does the US have a strategic advantage with in my example would be like, say you’re making a face cream out of coffee beans, like being based in Colombia, where most of the coffee comes from would be a huge advantage. And so certainly there are raw materials in the US that we have a surplus of, or could potentially source more efficiently. And so any thoughts on?

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Jason Azevedo 28:41
Yeah, so I mean, the reality is, the US has really good stronghold on on plastics, we’re flat plastics and steel, it’s kind of been our thing, that we’re strong there. But I’ve always felt that the concept of building near the raw material is completely just insane. It is so much easier to move something in its raw form, than after we’ve converted it, added it like like, think of a Lego brick, how much easier is it to move the resin for the brick than all of the air inside of that Lego brick, it is drastically easier to source raw materials from a place that has them and take them to where you’re going to make the final product. Yet for some reason. For a long time, people have been moving the manufacturing to the raw material and it’s like, wait another drastically easier to move when they’re in the raw form. So it’s because there’s a change that’s going on and you’re starting to see it with a lot more areas. Because what happened in state let’s go back 100 years. The reason why we saw manufacturers next to the raw material wasn’t because they went near the raw material. It was some guy who had a lot of coffee beans because he happens to be on Columbia and goes the hell am I gonna do with all these coffee beans and decided to make a face If people got used to that pattern and started thinking, oh, I want to be near my raw materials like no, these people just happen to have them. So they started doing things to them. As products are getting more complex, the likelihood of being next to all of your raw materials is zero, you’re not going to, you’re not going to make a product that is efficient to every raw material that happens to be in the zone that you’re in. So really, what’s shifting now is, we’re the commodities markets for these raw materials become more and more effective, to bring them to where we want to manufacture, not the other way around.

Ken 30:35
Yeah, fair enough. And that’s a good point too, on, you know, moving raw materials, and the raw form versus shipping air. I want to I’m I’m at the bar that one. So next question I have for Jason, you know, so for anybody listening to, you know, to the episode, how hard is it to start manufacturing, let’s say you, let’s say you’re an entrepreneur, and let’s pick up plastics, because you mentioned you know, us is we’re pretty dominant on plastics, let’s say they were they’re selling no plastic cups in Walmart, and Amazon, they got us out of a small business. And then they’re kind of interested in like self manufacturing, or even finding a manufacturer in the US. What’s that process look like? And how hard is

Jason Azevedo 31:14
it of course, it Jason comes down to the complexity of the product. But I will say manufacturing is a very certain skill set, and is not starting your own manufacturing plant is not smooth, it’s not easy. It’s usually contrary, it takes fighting a lot of internal belief systems that you have, or things that feel like they should work this way or that. But it’s also not impossible. So you look at like, nanotechnology starting in Nano technologies, it’s almost impossible. It’s such a level out there that you can’t touch it, you can start to make, and it’s just going to take work, and lots of it. The other part of it is that we’ve always been huge proponents of, you’ve got to share information. If you go through it thinking everything you’re doing is so proprietary AI, that you hold everything to your chest, you will have no friends, nobody will help you. And it’s going to hurt. And if you look at Tesla, having the realistically the only major car company that started in the last 100 years, and Elon came out and just gave all of their information to everybody say, Hey, here’s all my patents, here’s how we’re doing it. Because you almost have to you have, you have to have that level of openness to really drive forward because it is that the barrier to entry is hard. It’s not impossible. And that is what’s really important. Is e as if you’re willing to put the work in you can start manufacturing. And you but and but you really want you want to find that balance we talked about earlier, of kind of the jaded old, this is the way we do it, we’ve done it this for 70 years, and the book, Can we try it like this? Let’s do that. Let’s play with this. And if you can balance those correctly, it simplifies the process drastically.

David 33:07
It makes a lot of sense. You know, one follow up question I have is for people that are manufacturing the USA, or they’re sourcing products that are manufactured in the USA, what are some ways that they can want get that message out to their customers? And are there any, I’ve heard of like websites that like only sell made in the USA products. So we, as I mentioned, we recently started manufacturing in the USA and and we’d love to tell our customers about it. And we do in product inserts and whatnot. But what are some other ways you can kind of leverage that and use that to your advantage.

Jason Azevedo 33:43
So we’ll start domestically, and then we’ll kind of keep on growing outwards. But domestically, of course, just mentioned it, a lot of people will gravitate towards it. It doesn’t have to be like Made in America is the best. It’s, hey, we’re probably made in America, America, providing the one that goes a lot for at least for me and for a lot of the people I work with providing 100 American jobs in such and such town in Kansas, because that’s really what a lot of people are going to care about is that the impact of doing it in the US not just because it’s being done the US. Really what is that? What is the company to the community that it’s in? Hey, we’re, we’re out of Wichita Falls. So Wichita Falls, literally sponsored by our company. So that’s really what it means. Because when American buys an American product, oftentimes, they’re holding on to the belief in the love of the what that means to the community of the US. Not just hey, it’s an American made products. One of the one of the things that I always warn people about when they’re saying they’re American or American made products, they harp on it too much as well, it must be better because it’s American. And so like, the reality is, the iPhone is one of the most impressive devices in history. And it’s not American nation. So you can’t just use it as synonymous because, frankly, people this week disbelieve it, it’s really about how does it help people. Now, if you’re going to take your American made product, and you’re going to go outside of the US, this is where it becomes cool. The US Department of Commerce will help you. They will, if you can tell them that I’m making in the US, I’m an American company, they will actually get involved and help you export, help you understand the communities you’re going to, I’ve heard of them helping set up trade shows for companies that are going to other countries, it they the SBA has export loan programs for American made products. So really, there’s if you start looking outside American borders with American products, the US government does largely help try to get those to the markets because they understand it’s hard to compete on a global scale when you’re smaller.

David 36:06
For those of our listeners that are driving, we’re gonna post links to that in the show notes. The first one second one you mentioned was would be sba.gov. What was the first one that you mentioned? US Department of Commerce? Okay, we’ll post links to

Jason Azevedo 36:18
that. Yeah. And that you have local offices throughout the US. We’ve worked with them a couple times, I’ve heard great things about other friends working with them, that they really just kind of come in and go, Hey, how can we support you? Because we know it takes support to go to that global scale?

David 36:32
If you are kind of going on this topic? Have you heard of any, like Grant type programs or seed capital for people that are, you know, starting a manufacturing? Yeah, so.

Jason Azevedo 36:43
So what I do nowadays is I own a private equity, or I run a private equity fund, that is called MRCA, we go out and buy legacy US manufacturing partners, and make sure that they stay in those local communities and grow them and add that extra energy in that booth that they need to get to that next level. And we actually were looking at a company about six months ago. And they got a one point something million dollar grant to buy a new machine, because some US grant department decided that they wanted more of this type of manufacturing in the US and they were able to go there and prove, hey, if I buy this machine, I’m going to add this many people’s jobs. And they did the whole grant application and the government handed in the money hand on the machines that here you go. So there’s tons of stuff like that. There’s all sorts of programs that you can go into. It is specific to your product, your industry, and the kind of the niche that you’re in, but really look into it, because there was a lot of support.

Ken 37:43
Yeah, that’s awesome. I want to circle back on on one point that you made earlier. Jason, it was, you know, David asked question about the Made in USA and the you know, how do you leverage that, and you made a really strong point that, you know, I don’t think consumers are are buying a Made in USA products, or quality? You know, you give the example of the iPhone, I totally agree. It’s one of the best devices ever there. I think that I think it’s the notion of that they want to know that they’re supporting and helping others. I think that’s what a lot of people want. And so in order to, like build that connection, I think it’s a point that’s often missed. And I really liked your analogy, where like, hey, you know, this product was made in this small town community by these 100 people, and it supported their community. That is incredible. And it’s a way to build that connection, and kind of like a bond, and then that consumer knows that, hey, I’m helping out and this is my way to help out is to do that. So I really like that. So you touched on any Jason and David, any other questions or any other topics we want to talk to before we kind of pivot into MRCA?

David 38:41
Yeah, one last question. So this is for our listeners, this is also for us, for anyone that is in manufacturing, and wills, calm level one, like just getting into it, and they want to get to level 10 What would be some practical suggestions for, you know, stepping up our game, or to our listeners who are manufacturing for them to step up their game. So

Jason Azevedo 39:01
if you’re gonna get a manufacturing, you need to go buy a book called The Toyota way. It is kind of the entrance to any anybody who’s doing modern manufacturing. If you go into any of us that have war stories from doing these plants, or that kind of stuff, we all have a copy in our office. It’s it’s kind of the go to starter book. And what it does is it explains the transition that happened in manufacturing 3020 30 years that start there, because it will it starts breaking your stigma of how it should work. The other one, make friends share information. The amount of people I talk to they’re not this is proprietary. I can’t share it. Okay, I mean, I’m pretty sure you didn’t reinvent one of the oldest industries in the world today. Sure, I thought that you did. So I just really, it is about sharing information. It’s really about helping each other And the other one of it is get really good at saying I don’t know how to do. And that. Because once you can do that we force any person that we are any plant that we’re taking over that we’re worth starting to work with, I forced them to explain their process in a lot in linear steps. And usually, it’ll be like 25 steps, and we’ll try to get them down to four or five, there’s no way we do all this custom work, and it’s this. Okay, then let’s start figuring out how to get it that simple. Because once you simplify it, it becomes similar to being a decent, if you take a decent Cook, and you give them pretty much any recipe, they’re going to make it taste good. That’s what a good manufacturer will do. They’ll take the recipe from the engineer, they’ve got the baseline understanding of how the process works of manufacturing, and they will execute on that recipe and make it and make the product. Well. Any person who’s like Well, no, I that’s how it works. I’m only a pastry chef. Yeah, that’s not modern manufacturing. Is it? You need way more well rounded nowadays?

Ken 41:06
Awesome. Yeah, those are excellent tips. I’ve definitely wrote some notes down here. Very cool. Appreciate that. Awesome. So I want to pivot into RCA. So you had mentioned it briefly earlier, Jason. So can you share with the audience, you know, what does MRC S stand for? And kind of explain a little bit about

Jason Azevedo 41:21
it. Yeah, so MRC stands for the manufacturing revitalization Corporation of America. It’s a mouthful, we totally understand it is. But it was important for us to have each one of the words in. And really the one I harp on is revitalization, the US manufacturing got kicked for quite some time. And we got over talking today, the influence of low wage worker at low wage countries, we’ve gone into kind of some of the other stuff that’s gotten in the way. And what’s happened is a lot of people have not gone into manufacturing, it’s rare to find a younger person coming up through the companies. So what’s happening is we have an a set of ownership in the manufacturing space that’s aging out there usually going to be baby boomers, usually second third generation company. And there’s nobody to buy these companies. So what happens when they shut down. So what we do the MRCA, we search the country constantly for they have to be good, they have to be profitable, strong infrastructure, extreme resiliency, and usually ownership that has a ton of excess opportunity in front of them. But they’re tired, they don’t want it, they don’t want to execute on it. And on these, this next phase, they don’t want to add in automation or process, they’ve got a very healthy company that’s got good infrastructure. And they’re frankly, just riding the wave until they figure out how they’re going to exit. So we come in, we buy the companies, to them, put them all together, put them all together, make sure they stay in that local community that there in, take the years of infrastructure and foundation work this company has, and then overlay modern equipment, modern opportunities, interconnect the companies, really whatever we can find that adds value to these companies. And then about five to seven years in, we’re taking the entire portfolio nationwide. And we’re going to transfer 100% of the ownership to the employees through an employee stock ownership program. So the those local employees in those local communities will control that those factories stay in the local communities, basically, until they choose that they don’t. And that was the goal is let’s take this industry that’s strong, that’s healthy, really got it got these great companies with just strengthened a little bit more, put them all together. And then let’s actually let the American factory worker on this

David 43:55
factory. That’s awesome. That is awesome. And like it, is you lay it out really novel idea. I mean, that you hear of these businesses that, oh, my kids don’t want to go into the business. So I don’t know what I’m gonna do. And yeah, you’re right. They, you know, oftentimes if they have to shut down their jobs lost and manda kicker at the end, when you turn it over to employee stock options, that’s so cool. I don’t know, that fires me up, that fires me up. It’s exciting. We’re excited

Jason Azevedo 44:23
by it. And through the general partners when we sat down to frankly, great MRCA. We all sat and we had long discussions and the discussions all came back to why are we doing this? Like what is the true purpose because all of us have been in enough plants where all of us know how to build a manufacturing company. We know how to turn one around and does start to lose its shine eventually. And finally, we all just hit on record because it’s going to do a lot of good so like you want and let’s take it a step further and make sure to have a hell of a lot of good. And that was the goal is these communities that we get the wonderful opportunity that I get to go see a lot of these companies, even if we don’t buy them, we look at probably 100, to buy one or two. In all reality, these are not that it’s a lot of groundwork, you, we like to go see as many plants as we can for you get to see how cool some of these small communities are, where they’ve got, you’re in town, and they’ve got the local rodeo, or they’ve got this or that, and really starting to understand how diverse and kind of cool the quilt of the US is. Because the example I give everybody is we’ve got plants. So if I take a plant that’s in Texas, and a plant in California, completely different, and everybody thinks, Okay, here’s the baseline reasons why you’re gonna be different, like no, hey, we’ve got all this stuff that comes to your head, put that out, put that aside. In California, on Friday night, during high school football season, I asked somebody to work unless their kid plays on the team. They’re like, Yeah, I would love to have a Friday night shift, you do the same thing. In rural Texas, you can actually ruin somebody’s social circle, because that’s where they go see all their friends every week. So understanding that little difference, like scheduling on a Friday night, during a certain window of the year, completely changes. And that’s what we find so cool is you’ve got just this, every community truly is its own special thing. And we try to get in there. And one of the things we asked sellers at the club or during our due diligence, what don’t I know and make sense to you because you live here? And they’re like, oh, no, it’s just a typical place. So we’re talking to one he goes, Well, except for don’t ask anybody work after 230 at this plant? Well, like, why not? Well, because the only reason why you’d ever live in that town is because you’re either big time hunter or big time fisherman. And if you keep the plant open after 230, they can’t go hunting or fishing that day. So that I get so you, you bring him in at one in the morning, but everyone’s out by 230. Were like, we wouldn’t have known that. And like that same plant. He goes, Oh, yeah. And company paid holidays, on the first two days of every hunting season. And we’re like, Why? Why he goes, because if you schedule people to work Vegas show up anyways, she won’t get the day off and shut the blame. So it’s really what it is. So MRCA from a business side, yeah, we’re gonna have profitable companies where the goal is always to expand and make them bigger, more profitable, add more workforce, add more function, but also do that. So that communities got this stronger and stronger, stable. We were looking at a company that every day, they employed more people than the population of the town that their headquarters and you look up this city that they’re in, and the company’s name pops up on Google, not the name of the town. So just think about the impact you can have. If you’re strengthening that. That’s what MRCA really was focused on and is focused on how to transit.

Ken 48:10
That’s yeah, that’s awesome. This is an incredible, incredible story. I really like Yeah, I know, we’re coming up on time. I’d really like to Yeah, follow your story, and then have you back on in a few years and kind of see that and watch this kind of develop is very powerful, very impactful. And I really like it. Definitely want to Yeah, definitely want to Squeezin we have what’s called the fire round for every podcast guests. So we set them through the wringer. Are you ready, Jason? Oh, here we go. All right. What is your favorite book?

Jason Azevedo 48:38
Great Gatsby.

The Great Gatsby: The Original 1925 Edition (F. Scott Fitzgerald Classics)
  • Fitzgerald, F. Scott (Author)
  • English (Publication Language)
  • 110 Pages - 04/10/2022 (Publication Date) - Independently published (Publisher)

Ken 48:39
What are your hobbies?

Jason Azevedo 48:40
I live on a ranch. So ranch work? I guess about my hobby.

Ken 48:45
Nice. What is the one thing that you do not miss about working for the man?

Jason Azevedo 48:51
I’ve never actually worked for another person. That’s awesome.

Ken 48:54
You started your first one? Ever? Yeah.

Jason Azevedo 48:57
I’ve never actually

Ken 48:59
worked for somebody. That’s awesome. So yeah, no answer on number three. today. We’ll mark it in a right next one. What do you think sets apart successful entrepreneurs from those who give up fail or never get started?

Jason Azevedo 49:11
It you are gonna get kicked, you’re gonna get knocked down. You get back up and do it again. That’s awesome.

Ken 49:16
David, you want to close out the show?

David 49:19
Yeah, Jason, if people want to get a hold of you or learn more about advocate or MRCA what would be the best way to do that?

Jason Azevedo 49:26
Best way is going to mrca.net If you’re interested in investing with us, there’s a link there for accredited investors. You know that that you can look at what we’re doing. Look at our team. If you have questions regarding MRCA regarding manufacturing that you’ve that you’re thinking about doing about a cookie recipe on there is a link to get time directly on my personal calendar. I am like I said multiple times where the show we’re all about sharing information. We leave ourselves open all the general partners for mercy have that have a link there you could set time get Get on there. We’ll sit down and talk about whatever you want to talk about. Please feel free to use it. We actually do really appreciate just talking to people about, hey, I’ve got this idea or I ran into this problem, or, Hey, I really like chocolate chip cookies, whatever it is, we’ll sit and talk.

David 50:14
Awesome. Well, thank you so much for being a guest on the firing the man podcast and looking forward to staying in touch and following your story. Awesome. Thanks. And thanks for having me. Thank you everyone for tuning in to today’s firing the man podcast. If you liked this episode, head on over to firingtheman.com, and check out our resource library for exclusive firing the man discounts on popular e commerce subscription services that is firingtheman.com/resource, you can also find a comprehensive library of over 50 books that Ken and I have read in the last few years that have made a meaningful impact on our business, or that head on over to www.firingtheman.com/library.  Lastly, check us out on social media at firingtheman in on YouTube at firing the man for exclusive content. This is David Schomer

Ken 51:03
and Ken Wilson, we’re out

David 51:20
before you go fun fact for all you Amazon sellers out there when you start selling in international marketplaces, all of your reviews come with you. At the beginning of this year, Ken and I sat down and talked of ways that we could double our businesses in size and landed on international expansion as our number one initiative this year. We partnered up with Kevin Sanderson from maximizing ecommerce and he has made the process an absolute breeze walking us step by step through the process. If you want to grow your revenue and reach new customers head on over to https://maximizingecommerce.com/fire and connect with Kevin Sanderson today. Now back to the show.