Monday, August 10, 2009

A regional sourcing strategy? In my supply chain network? It is more likely than you think.

Greater disparity in labor wages + low transportation costs = longer supply chains = bigger distribution centers = hubs servicing half the continent = good for the Inland Empire

Weak American Dollar + high fuel prices = shorter supply chains = local suppliers + regional warehouses = bad for the Inland Empire

From the FT:

Manufacturers are abandoning global supply chains for regional ones in a big shift brought about by the financial crisis and climate change concerns, according to executives and analysts.

Companies are increasingly looking closer to home for their components, meaning that for their US or European operations they are more likely to use Mexico and eastern Europe than China, as previously.

No comments: