Key Considerations in Evaluating the Popular NearShoring Trend
The trend of re-shoring manufacturing jobs has accelerated due to the COVID-19 pandemic, with 800,000 jobs brought back from offshore locations. Now, businesses are considering near-shoring as a way to future-proof operations, reduce reliance on China, and increase speed to market. When selecting a near-shoring destination, factors such as labor availability, costs, infrastructure, and political landscape should be considered. Building strong relationships with trusted suppliers and ensuring a diversified supplier mix are also important for near-shoring success. Analytics-driven supply chain monitoring is crucial for managing disruptions.
Source: Link
Frequently Asked Questions
Q: What is nearshoring in the context of supply chain?
A: Nearshoring refers to the practice of relocating manufacturing or production operations to countries that are closer in proximity to the company's home market. It is done to take advantage of shorter and more reliable supply chains, lower costs, and potentially mitigate risks. [Source: Exploring the Nearshoring Mega-Trend and its Implications]
Q: Why are global corporations re-evaluating their manufacturing footprint?
A: Global corporations are re-evaluating their manufacturing footprint due to supply chain trends and challenges. Nearshoring and friendshoring are being considered as potential strategies to address these challenges, reduce costs, and improve supply chain resilience. [Source: The supply chain trends shaking up 2023 - KPMG Global]
Q: What are some key considerations in evaluating the nearshoring trend?
A: Some key considerations in evaluating the nearshoring trend include factors such as cost competitiveness, infrastructure capabilities, political stability, labor force availability and skills, trade agreements, and proximity to the company's home market. Each company should carefully assess these factors to determine the feasibility and benefits of nearshoring for their specific operations. [Source: Nearshoring Trends And Important Considerations When Looking to Mexico]
Q: How can nearshoring help with supply chain challenges?
A: Nearshoring can help with supply chain challenges by providing shorter and more reliable supply chains. By relocating manufacturing or production operations to countries closer in proximity to the company's home market, companies can potentially reduce transportation costs, lead times, and inventory levels. Nearshoring can also offer opportunities for improving supply chain flexibility and resilience. [Source: As Nearshoring Takes Off, Here's How SMBs Can Shorten Their Supply Chains]
Q: What are some potential nearshoring destinations?
A: Some potential nearshoring destinations include countries in Eastern Europe, Mexico, and certain countries in Latin America and the Caribbean. These destinations offer factors such as lower costs, available labor force, infrastructure capabilities, and proximity to key markets. The choice of destination depends on various factors specific to the company's operations and requirements. [Source: Supply chain resilience: exploring nearshoring to unlock new, Mexico Nearshoring: “Opportunity Knocks”, Nearshoring can add annual $78 bln in exports from Latin America]
Note: The search results provided information on nearshoring in the context of supply chain, considerations in evaluating the trend, potential destinations, and benefits of nearshoring. For more detailed information, please refer to the provided links.