More than 1,450 senior decision makers in large companies in France, Germany, the Nordic countries, the United States, the United Kingdom and the United Arab Emirates were surveyed in a study commissioned by IFS.
…72% of respondents increased the proportion of materials/products they source from domestic suppliers as a result of the recent supply chain issues.
The increase in sourcing from domestic suppliers creates more opportunities for diverse owned companies.
Source; https://www.scmr.com/article/supply_chain_disruptions_drive_up_costs_complexity_at_large_enterprise
This BNN Bloomberg article, US Factory Boom Heats Up as CEOs Yank Production Out of China, states some more reasons why nearshoring & reshoring is still trending, even after covid.
Rattled by the most recent wave of strict Covid lockdowns in China, the long-time manufacturing hub of choice for multinationals, CEOs have been highlighting plans to relocate production — using the buzzwords onshoring, reshoring or nearshoring — at a greater clip this year than they even did in the first six months of the pandemic, according to a review of earnings call and conference presentations transcribed by Bloomberg. (Compared to pre-pandemic periods, these references are up over 1,000%.)….
In January 2022, a UBS survey of C-suite executives revealed the magnitude of re- & nearshoring. More than 90% of those surveyed said they either were in the process of moving production out of China or had plans to do so. And about 80% said they were considering bringing some of it back to the US. (Mexico has also become a popular choice.) …..
“We wanted to be closer to our customers in the southeast,” said Generac Holdings Chief Operations Officer Tom Pettit. Low shipping costs and quick delivery times are proving a hit with clients and paving the way for the company to keep growing, he said. Opened just a year ago, expansion work on the plant is already underway…..
Below a few examples on nearshoring from the retail industry, and how this leads to more engagement with diverse owned businesses;
- Ahold Delhaize USA’s Peapod Digital Labs has launched an Incubator Program for certified diverse-owned suppliers to develop new, exceptional-quality private-brand products. https://progressivegrocer.com/ahold-delhaizes-digital-arm-searches-diverse-suppliers Peapod Digital Labs is the digital, e-commerce and commercial engine of Ahold Delhaize USA, serving as the innovation lab for Food Lion, Giant Food, The Giant Co., Hannaford, and Stop & Shop.
- PepsiCo declares it’s now in a quiet period and can’t project what spending will be in 2022. PepsiCo reports it’s still on track to spend more than $400 million annually with Black and Hispanic suppliers as part of its Racial Equality Journey launched in 2020. https://www.blackenterprise.com/pepsico-reinforces-pledge-to-invest-millions-more-with-black-suppliers/
- Shipt announces to buy from more diverse owned businesses ; … Shipt will expand by diversifying the stores it delivers from including places such as local ethnic grocers. The business unit can build its last-mile delivery service further, including more packages from Target sortation centers. https://www.startribune.com/new-shipt-ceo-sees-plenty-of-growth-ahead-for-grocery-deliveries/600188144/