Quality is by far the most important consideration for a manufacturer when competing with cheap labor. Quality establishes the market for an item. As customers discover the value of the quality, more and more people (sales) occur. As sales increase the manuacturer begins to look at ways to reduce costs to increase profits yet continue to maintain the product quality customers expect. New products can then be created and added to the manufacturer line to further build sales and profits.
Cheap labor to a manufacturer many times increase costs in returns, customer diastisfaction, rejects, all reducing profits. Without profits a manufacturer is not able to stay in business. The market is continually changing requiring the manufacturer to continually invest in new products, new solutions which profit pays for. Cheap labor decreases value, quality increases value and growth. Apple computer is a great example of this as they entered the market with a higher cost high quality computer. As their market share grew, they were able to expand to now be one of the largest companies in the world. They have expanded into the world market with reduced costs as the market place accepted their products allowing them to develop new products that have become the basis for the industry