An examination of the value chain, however, reveals that there are a number of elements and complexities in addition to wage rates that drive significant cost and efficiency across design, logistics and manufacturing activities across borders.

Today, the primary questions for organizations and governments is twofold; [1] “Should we reshore, offshore or both?” and if yes, [2] “Where should we locate our facilities and activities so as to benefit from our chosen strategy?”

Competitive edge

Competitive Intelligence, often recognized for its role in assessing competitive landscapes, has been a driving force in the examination of this complex set of value chain measurements revealing surprising realities about advantages in efficiency and effectiveness in innovation, development, manufacturing and logistical capabilities within U.S. borders.

What competitive advantages may be afforded to those who do reshore their business initiatives? As a guiding set of metrics, decisions to reshore should offer favorable answers to the following set of driving forces.  Reshoring should provide the following;

  • Better control over product and service offerings

  • Improved response times to development, commercialization and logistics

  • Increased environmental controls

  • Creation of intrinsic value and social responsiveness

  • Reduction in import and export taxes and other cross border hidden costs

  • Heighted awareness and controls of political situations

  • Elevated crisis management plans related to weather, security and other threats

  • Influence on cost avoidance capabilities related to shipping, storage, damage costs and payment systems

  • Expanded controls to ensure Intellectual Property protection

  • Elimination of cultural barriers and employment regulations that may inhibit innovation and production

Applying learnings

These guiding metrics should support, negate or have significant influence on the decision to reshore. The experienced competitive integrated intelligence professional in partnership with other organizational disciplines and executive decision makers is well versed in identifying the influence of these factors on competitive advantage.

  • Once these metrics indicate reshoring is the right choice, the following due diligence will direct the reshoring strategy supporting the location of development, innovation and manufacturing capabilities here at home. A well-constructed due diligence assessment, following the previous litmus test, guides the decision via positive outcomes to the following analysis which includes but is not limited to;

  • Cost of land and property access

  • Environmental controls

  • Talent pool availability, cost and local pride

  • Customer locale

  • Cost effective distribution

  • Political constituencies and intrinsic regional value

  • Regional weather conditions

  • Logistics costs [import, export and road taxes, shipping, storage, distribution]

  • Quality control and response time

In some cases, it makes sense to offshore but a full assessment of value chains reveals the intricacies of business hidden costs that alter the decisions. Fully engage the capabilities of competitive integrated intelligence to help you make decisions.