Many high-tech companies have adopted a “right-shoring” strategy for their manufacturing supply chains, an approach that balances factors such as cost, quality and transit time, according to UPS Inc.’s fifth-annual Change in the (Supply) Chain survey.
The survey, conducted for UPS by IDC Manufacturing Insights, polled 516 senior supply chain executives in the high-tech industry in North America, Europe, Asia, the Pacific and Latin America.
Offshoring of manufacturing and assembly operations to countries with low labor costs remains the most common strategy, but a growing number of tech firms said they are “near-shoring” — moving production closer to end markets — to improve service levels, reduce inventory in transit and gain more control over product quality.
Among the survey’s respondents, 45% said their companies use right-shoring strategies, 47% said they offshore and 35% said they near-shore. Near-shoring was up 25 percentage points from 2010.“High-tech companies are building more flexibility into their shoring strategies and supply chains so they can respond better to demanding market dynamics,” said Dave Roegge, high-tech marketing director at UPS. “They’re thinking more holistically about their strategies to evaluate their transportation costs and the time it takes companies to deliver goods.”
Read more at Many High-Tech Firms Adopt ‘Right-Shoring’ Supply-Chain Strategy, UPS Survey Finds
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