Recently, the New York Times reported on two companies that shows how it's "still possible to manufacture high-quality products in one of the most expensive locations in the United States — even in the grip of an economic recession." Specifically, high-end Heath Ceramics is succeeding for its owners Robin Petravic and Catherine Bailey in part because of the company's "idiosyncratic way of doing things and its geographical roots."  The factory is located in Sausalito, CA, close to its customer base and benefits from having every part of its manufacturing process in one building.  Bailey says that  on ething that impressed her when buying the company was that “Many of the employees had worked there for decades and knew everything, including how to fix the machines if they broke down.” Petravic and Bailey have modernized the company to make their manufacturing more efficient. New production systems have been brought on-line and they've introduced a line of less expensive tile, an off-the shelf style that is rougly 40% cheaper than custom tile.  Wholesale sales have also been overtaken by direct Internet sales. A few miles south, in Berkeley, Michael Goldin owns a furniture manufacturing company, Swerve.  He says the company has succeeded by utilizing new technology to produce precision-cut, eco-friendly work surfaces for desks, workstations, and shelves.  Goldin said he did not want to see his products made overseas in part because he couldn't guarantee quality control.  He says that feels very strongly about "having my hands in what I am making — actually feeling materials and how they work."  With products shipped from overseas he asks, "How do you make sure your product comes to you as you specified it? Overseeing the process would require constant traveling back and forth.” Goldin also says he has stayed in business by utilizing a "just-in-time manufacturing model" where products are made to order.  Outsourcing would mean a riskier step of ordering huge advance inventory.   Labor costs are also kept low through a reliance on new, computerized cutting machines that can run 24 hours a day. Of Swerve’s 15 employees, only four work on the shop floor. In the last few months, Mr. Goldin has had to make some hard choices to ensure that Swerve rides out the economic crisis. A recent order for 500 aluminum-framed chairs will be completed at cost. He and his administrative staff have vacated the factory’s sleek offices and some income-generating tenants have moved in. And his employees have all agreed to salary cuts. But he believes more strongly than ever that outsourcing would be the wrong choice. “Of all times, we need to do what we can to keep jobs here,” he said. Hoefully small- and medium-size U.S. businesses like Heath and Swerve can continue to remain competitive in tight times, and can remain in the U.S.  As Bailey notes, “The craft of manufacturing has to a great extent been lost as a value in American culture, and we are striving to retain it.”