The dynamics of reshoring decisions and the role of purchasing

Abstract

Reshoring is a reversal of offshoring decisions and is increasing in business practice. There is limited understanding of how different drivers relate to different reshoring decisions. There has been little examination of purchasing's role in reshoring decision-making. Through 25 case studies of reshoring decisions taken by 18 companies, this research examines the relationship between different drivers and the type of reshoring decision taken, and how purchasing was involved at different stages of the reshoring decision-making process. The findings reveal four types of reshoring; most companies made mono-dimensional reshoring decisions, and three types of mono-dimensional decisions were found. One type of bi-dimensional reshoring initiatives involved changed location and ownership. The most common drivers for reshoring were operational reasons and brand reputation, as reasons for the original offshoring decision had changed over time. Four types of involvement of purchasing in different stages of reshoring decisions were found: no involvement, operational involvement in implementation, early involvement in feasibility studies, and strategic involvement throughout the whole process. Different types of purchasing involvement were found to relate to different types of reshoring with particularly strong involvement in bi-dimensional reshoring decisions.

Keywords:

• decision analysis
• reshoring decisions
• reshoring drivers
• purchasing

Disclosure statement

No potential conflict of interest was reported by the authors.

ORCID

Andrea Stefano Patrucco http://orcid.org/0000-0002-9367-1561