Manufacturers Plan Nearshoring and Reshoring

Manufacturers Plan Nearshoring and Reshoring

In April 2020, 878 North American companies were surveyed, with 64% of those companies reporting they will likely reshore or nearshore manufacturing and sourcing to avoid supply chain disruptions in the future.  Manufacturers can shorten lead time and cut transportation costs by reshoring and/or nearshoring.

The handling of the COVID-19 outbreak in China further illustrated the vulnerabilities associated with sourcing from distant regions of the world.


Video Spotlight: 


This post is based on the Supply Chain Dive article, 64% of manufacturers say reshoring is likely following pandemic: survey, by Matt Leonard, May 14, 2020, and the YouTube videos in the Spotlight. Image source: Shutterstock / 3D_creation

Discussion Questions:

1.  Let’s suppose a United States company is planning to maintain a current supplier in China and plans to nearshore a new supplier in Mexico.  What is the best sourcing strategy for each supplier from the company’s perspective?

Guidance: Lead time from China is longer, but the costs may or may not be lower.  Lead time from Mexico should be Continue reading

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Effect of Chinese New Year on Inventory Management

Effect of Chinese New Year on Inventory Management

January 27, 2020

The Chinese New Year brings manufacturing slowdowns in China. United States companies must plan on being proactive in managing supply by making early purchases and scheduling transportation before the slowdowns begin.

Building buffer inventory in the United States as a result of early purchases means storage capacity in the United States must be managed proactively as well.


Video Spotlight:


This post is based on the Supply Chain Dive article, Why procurement planning is critical ahead of Chinese New Year, by Amanda Loudin, January 16, 2020, and the YouTube videos in the Video Spotlight. Image source: Shutterstock / Dmitry Kalinovsky.

Discussion Questions:

1. Note in the article that the average shipping time from China to the United States is about 30 days.  How does this lead time impact inventory levels at United States facilities?

Guidance: This question is designed to get students to reflect on the interaction between lead time and inventory levels.   Ask students to suggest better ways to accumulate the additional Continue reading

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French Fry Shortage Looming?

French Fry Shortage Looming?

December 22, 2019

Unusually cold and wet weather this Fall has impacted the potato harvest.  Many Canadian and US growers will have a significantly reduced potato harvest this year.

Additionally, many of the potatoes being harvested are smaller in size.  French fry processors prefer larger potatoes.  The US Department of Agriculture is projecting a 6.1% reduction in potato harvest in the US.

Potato harvests in the Canadian Provinces of Manitoba and Alberta are especially hard hit.


Video Spotlight: Potato crop woes could lead to potential French fry shortage


This post is based on the KSL article, An Unusually Cold and Wet Potato Harvest Season May Lead to A French Fry Shortage in The US, by Harmeet Kaur, December 3, 2019, and the YouTube video, Potato crop woes could lead to potential French fry shortage , by ABC 10 News, December 3, 2019. Image source: Shutterstock / studiovin

Discussion Questions:

1. What is the potential impact of the potato shortage?

Guidance: The end result will probably be higher prices for potatoes.  Although the US and Canada produce large amounts of potatoes, they rank 5th and 13th in the world in potato production.  So, other sources Continue reading

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