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Offshoring and Reshoring: An Update on the Manufacturing Location Decision

The journal of supply chain management, 2013-04, Vol.49 (2), p.14-22 [Peer Reviewed Journal]

2013 Institute for Supply Management, Inc. ;COPYRIGHT 2013 John Wiley & Sons, Inc. ;Copyright Blackwell Publishing Ltd. Apr 2013 ;ISSN: 1523-2409 ;EISSN: 1745-493X ;DOI: 10.1111/jscm.12019

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  • Title:
    Offshoring and Reshoring: An Update on the Manufacturing Location Decision
  • Author: Ellram, Lisa M. ; Tate, Wendy L. ; Petersen, Kenneth J.
  • Subjects: Analysis ; Decision analysis ; Foreign investment ; Globalization ; Industrial locations ; internalization theory ; Labor costs ; Location ; Location analysis ; Logistics ; Manufacturing ; Manufacturing industry ; manufacturing location ; nearshoring ; offshoring ; Outsourcing ; Perceptions ; Production management ; Shipping industry ; Studies ; Supply chains
  • Is Part Of: The journal of supply chain management, 2013-04, Vol.49 (2), p.14-22
  • Description: This research uses data from a survey to explore the factors that affect organizations' manufacturing location decisions. Manufacturing location, more specifically the possibility of firms' nearshoring or reshoring, has received a great deal of recent attention, especially in the United States. This paper applies the location aspect of internalization theory to provide an understanding of what factors affect organizations' perceptions of the attractiveness of various regions as locations for owned manufacturing facilities. An exploratory factor analysis is used to develop factors that drive manufacturing location decisions. Multiple regression analysis is used to test the relationship between the drivers of manufacturing location decisions and movement of manufacturing into or out of a region, and overall perceived risk of a region. Findings indicate that various drivers have differential effects across regions. For example, while North America is viewed favorably for its trade policies over the next 3 years, the trade policies are also viewed as an increasing source of risk, possibly reflecting bipartisan conflicts. Three theoretical propositions are developed to advance the understanding of the current state of manufacturing location decisions from an internalization perspective. It appears that organizations are beginning to look at their manufacturing location decisions through a broader lens, giving more weight to supply chain issues as well as strategic factors.
  • Publisher: Wheat Ridge: Blackwell Publishing Ltd
  • Language: English
  • Identifier: ISSN: 1523-2409
    EISSN: 1745-493X
    DOI: 10.1111/jscm.12019
  • Source: AUTh Library subscriptions: ProQuest Central
    Alma/SFX Local Collection
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