Maximizing Onshoring Benefits Through Data-Driven Supply Chain Decisions
Table of Contents
- Introduction
- Understanding Onshoring and Nearshoring
- The Global Perspective
- Triggers for Onshoring and Nearshoring
- The Supply Chain Equation
- Evaluating Onshoring Strategies with Any Logistics
- Building Baseline Supply Chain Models
- Running Scenarios and Comparing KPIs
- Implementing Onshoring Strategies in the Real World
- High-Level Analysis and Comparisons
Introduction
In this webinar, we will be discussing and evaluating onshoring and nearshoring strategies in the context of supply chain design. Our goal is to help you understand how to balance cost, service level, and risk when making supply chain changes. We will be using simulation and optimization tools provided by Any Logistics to model different scenarios and analyze the potential benefits of onshoring and nearshoring. By the end of this webinar, you will have the knowledge to create a baseline model, evaluate different scenarios, and make data-driven decisions on whether onshoring is worth it for your business.
Understanding Onshoring and Nearshoring
To begin, let's clarify the terms "onshoring" and "nearshoring." Onshoring and reshoring refer to the act of manufacturing within your company's primary country. It is the process of bringing production back to your home country after manufacturing offshore. Nearshoring, on the other hand, involves manufacturing outside your primary country but within close proximity, such as in neighboring countries or regions.
The Global Perspective
Onshoring and nearshoring are not limited to any specific country or region. Companies worldwide are considering these strategies due to various triggers such as trade wars, tariffs, natural disasters, intellectual property concerns, and rising labor costs in developing countries. Headlines from different parts of the world highlight the global nature of this topic, indicating that companies are actively considering these strategies for a range of reasons.
Triggers for Onshoring and Nearshoring
There are several triggers that have led to the increased consideration of onshoring and nearshoring strategies. These triggers include trade wars, tariffs, natural disasters, intellectual property concerns, and rising labor costs in developing countries. These factors have caused disruptions in supply chains, resulting in delays, border closures, shortages, and additional costs that were not planned for. As a result, companies are reassessing their supply chain strategies and placing a higher value on factors such as agility, resiliency, visibility, and quality control.
The Supply Chain Equation
When evaluating onshoring and nearshoring strategies, it is essential to consider the supply chain equation, which consists of cost, service level, and now, risk. No longer are companies solely focused on minimizing costs; they are also considering the risk and resiliency of their supply chains. By balancing these factors, companies can design the optimal supply chain for their business.
Evaluating Onshoring Strategies with Any Logistics
Any Logistics provides an end-to-end analytics tool that helps organizations make data-driven decisions about their supply chains. With Any Logistics, you can build complex models, perform optimization and simulation experiments, and evaluate the impact of different scenarios on your supply chain. The tool incorporates GIS and demographic data, allowing for deeper analysis and insights.
Building Baseline Supply Chain Models
To evaluate onshoring strategies, you need to start by creating a baseline model of your existing supply chain. This includes mapping out your suppliers, ports, distribution centers (DCs), and customers. With the help of Any Logistics, you can visualize and animate the flow of products through your supply chain, allowing for a deeper understanding of how it operates.
Running Scenarios and Comparing KPIs
Once you have a baseline model, you can start evaluating different onshoring scenarios. With Any Logistics, you can run experiments and compare key performance indicators (KPIs) for each scenario. This enables you to make data-driven decisions based on the impact of onshoring strategies on various aspects of your supply chain, such as cost, service level, inventory, and transportation.
Implementing Onshoring Strategies in the Real World
After analyzing different scenarios and validating the results, you can implement the chosen onshoring strategy in the real world. Any Logistics provides a platform for modeling, simulation, and optimization, giving you the tools to confidently make changes to your supply chain. By following a phased approach and considering all the factors involved, you can effectively implement onshoring strategies and reap their benefits.
High-Level Analysis and Comparisons
By using Any Logistics and conducting thorough analyses, you can gain valuable insights into the potential benefits of onshoring strategies for your business. Whether you are evaluating the impact on costs, service levels, inventory, or transportation, Any Logistics gives you the tools to make informed decisions. Through high-level analysis and comparisons, you can ensure that your onshoring strategies align with your overall business objectives.
📌 Highlights:
- Understanding the terms "onshoring" and "nearshoring."
- The global perspective of onshoring and nearshoring.
- Triggers for considering onshoring and nearshoring.
- Balancing cost, service level, and risk in the supply chain equation.
- How Any Logistics can help evaluate onshoring strategies.
- Building baseline supply chain models and running scenarios.
- Analyzing KPIs and making data-driven decisions.
- Implementing onshoring strategies in the real world.
- Considering the high-level analysis and comparisons.
📚 Resources:
🙋♀️ FAQ
Q: What is the difference between onshoring and reshoring?
A: Onshoring and reshoring are essentially the same concept, which involves bringing manufacturing operations back to a company's primary country. The term reshoring specifically refers to the act of moving manufacturing back after being offshore.
Q: Is there a limit to the number of SKUs that can be created in a production site?
A: There is no set limit to the number of SKUs that can be created in a production site. The capacity is determined by factors such as space, resources, and production capabilities.
Q: Where do the cost metrics come from in Any Logistics, and can they be customized based on locality?
A: The cost metrics in Any Logistics can be customized based on your specific locality. You can input your own cost data and customize it to accurately reflect your real-world costs.
Q: Is Any Logistics capable of capturing real-time results during simulations?
A: Any Logistics can capture real-time results during simulations by incorporating real-time data into the models. This allows for accurate and up-to-date analysis of your supply chain.
Q: How can I determine if onshoring is worth it for my business?
A: Evaluating the worthiness of onshoring for your business involves considering multiple factors, such as costs, service levels, inventory management, and risk. By using tools like Any Logistics, you can perform scenario comparisons and make data-driven decisions based on the results.
Q: Can Any Logistics model the impact of volatile events, such as the COVID-19 pandemic?
A: Yes, Any Logistics can model the impact of volatile events, such as the COVID-19 pandemic. By incorporating event-driven scenarios and analyzing the results, you can evaluate the potential effects on your supply chain and make informed decisions.
