Probably labor cost. An anecdote: There’s a really good book called China Inc. that has a story about a belt manufacture in America. The American executive tou

Probably labor cost. An anecdote: There’s a really good book called China Inc. that has a story about a belt manufacture in America. The American executive tours a belt manufacture in China one day. He sees that all of the leather hides that have blemishes are being used whereas he would have to discard them. The Chinese factory had so many workers that were paid so little, they could afford to pay someone to cut out small, even tiny patches of leather, and glue them into the blemishes of the belts. It hit the guy so hard that he decided then and there to close his factory in America and move it to China.