Reshoring - A Driving Force To US Manufacturing

Document Type

Conference Proceeding

Publication Date

1-1-2015

School

Leadership

Abstract

Reshoring is a new trend of bringing operations back to the US that were offshored. Reshoring seems to be a natural phenomenon of rebalancing between supply and demand locations in manufacturing. Many manufacturers have included a key element in their strategy to match supply with demand location more closely by reshoring or nearshoring manufacturing and supply. Although offshoring will continue to play a role in the supply location strategy of companies, it will be largely done in the context of chasing the demand location. This new trend of moving more supply closer to demand location appears to be a new shift for many US manufacturers. This paper presents a research study that identified emerging factors of reshoring, sensitivity of those factors toward reshoring, and the development of reshorability index that measures the likelihood of reshoring. Some of the most important factors that affect reshoring are increasing cost of overseas wages, energy cost, cost of logistics and transportation, quality issues, etc. The findings reveal the beginning of a trend to bring more and more operations back to the US. A shift to reshore manufacturing operations appears to be here to stay as manufacturers look for the next level of competitive advantage.

Publication Title

IIE Annual Conference and Expo 2015

First Page

3091

Last Page

3100

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