Strategic Insights on Supply Base Localization PPT
This PPT slide, part of the 21-slide Manufacturing: Reshoring PowerPoint presentation, presents a critical examination of supply base localization as a key operational factor in the reshoring process. It highlights the challenges faced by managers in industries where production is relocated to countries like the US, particularly when existing supply chains are underdeveloped. The example given illustrates that many domestic suppliers for essential components, such as screen displays and batteries, are lacking, leading to increased logistics costs when materials must be imported.
The slide emphasizes that for reshoring efforts to be economically viable, the benefits gained from customization and proximity to market must outweigh the additional costs associated with transportation and supply chain logistics. This sets a clear expectation that localized supply chains require careful planning and execution.
Two primary considerations for effective supply base localization are outlined. First, organizations must identify core competencies that need to be developed internally. This involves assessing which capabilities can be built in-house to enhance operational efficiency. Second, there is a need to recognize areas where strategic partnerships with suppliers can yield greater benefits. This dual approach encourages a balance between internal capability development and external collaboration.
The case example from Appliance Park reinforces these points, illustrating the necessity for managers to adopt a strategic perspective on supplier relationships. It stresses the importance of long-term investments in supplier ecosystems over short-term cost negotiations. This insight is crucial for executives considering reshoring strategies, as it underscores the need for a comprehensive approach that integrates both economic and strategic factors in supply base localization.
This slide is part of the Manufacturing: Reshoring PowerPoint presentation.
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Manufacturing Core Competencies Supply Chain Logistics Transportation Production
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