Closer to home

The survey, of 1830 UK and international supply chain managers, found that two-fifths of UK organizations switched at least one international supplier to a domestic alternative in the last year. Of those who had moved to a UK supplier, 70 percent cited domestic suppliers as a more reliable source of supply and 59 percent referenced shorter lead times as the reason for the switch.

The move is driven by global supply issues caused by the pandemic, the ongoing conflict in Ukraine, and rising global inflation. However, reshoring is not a viable option for all and requires the relevant capability in the UK. One in five of the organizations who had not moved to local suppliers said they looked for a UK alternative but were unable to find one.

Reshoring is not just a UK trend. In the last year, more than half of supply chain managers in South Africa, MENA, and Sub-Saharan Africa also swapped international partners for locally based alternatives. Dr. John Glen, Chief Economist, CIPS, warns that “businesses need to be careful not to make hasty decisions when it comes to moving suppliers back to the UK. Reshoring can be a long and costly process where compromises have to be made. With some evidence that global supply chain disruption is starting to ease, some businesses could be left wishing they had held firm with their global partners. In the ever-changing world of cross-border trade, businesses need to think carefully and avoid making short-term decisions to meet long-term demands.”