Manufacturing within Europe increasingly attractive: From Offshoring to Reshoring

For decades, companies have been “offshoring” their shoe production outside of Europe, to countries like China and India. When we talk about offshoring, it means nothing less than moving production operations to another country, usually outside of Europe. One of the main reasons for manufacturing abroad is because the costs there are relatively low. However, due to environmental concerns, poor working conditions and extremely rising freight costs from Asia, companies are increasingly turning to ‘Reshoring’. We would be happy to explain all about reshoring and why it is becoming increasingly important and attractive to bring production back or keep it in Europe.

Why reshoring?

More and more Western European countries are taking back their production from abroad, other companies are deliberately choosing to keep current production in Europe. One of the reasons for doing this is that European entrepreneurs and customers attach more and more value to sustainable production and good working conditions. After all, companies can no longer justify themselves if their production is produced under poor working conditions. But also think of the many containers that are transported from Asia to Europe and all the greenhouse gas emissions that this involves. Bringing production closer to home contributes to socially responsible business operations. Consumers are also attaching more and more value to this.

Optimization & innovation

There are continuous developments and innovations within the production process. For example, nowadays a customer expects a short delivery time when ordering a product. There is also a lot of demand for customized products and ‘special edition’ series that are produced in smaller quantities. By keeping production closer to home, this can be better accommodated. A language barrier or cultural difference can also play a role in opting for reshoring. Cooperation between European suppliers is necessary here.

In a rapids by COVID-19

Labor costs in low-wage countries have been increasing for years. An extreme development is currently taking place in the area of transport costs from Asia. Transportation costs have increased significantly and this is currently in a state of flux due to the effects of COVID-19.

Surely the biggest arguments of offshoring are the costs. But labor costs in low-wage countries have been increasing for years and there is currently an extreme development in transportation costs from Asia. Transport costs have risen significantly and COVID-19 has only accelerated this further.

All this together has made more and more companies realize how dependent we really are on the unsustainable global supply chain.

Are you curious about what all these developments mean for our production process? Then feel free to contact us.