Let’s talk about nearshoring. You’ve got questions about moving manufacturing operations to a nearby country from one of greater distance. But where do you find answers?

First off, you’re not alone. According to a recent study from automation provider ABB, 70% of U.S. businesses are planning to nearshore operations to build their supply chain resilience.

But it’s not just a matter of picking up and moving operations closer to home. Nearshoring presents real questions related to:

  • Quality issues
  • Supply chain partners
  • Skilled labor

We engaged two members of our Ryerson Advanced Processing team, General Manager James Porter and Supply Chain Director Tim Driver to tackle three burning questions on nearshoring.

How Long Does Will It Take to Near Shore My Manufacturing Operations?

First things, first: when it comes to nearshoring, you need to ensure it can be done in a timely manner and with as little disruption as possible. For many, the hardest part may be that dynamic transfer from an existing durable supply chain to one with an unknown set of suppliers and vendors.

But you don’t need to go at it alone. Porter and Driver discuss a typical timeframe for near shoring, along with the value of a qualified partner network in streamlining that process. 

How Do I Ensure Quality with Nearshoring?

As supply chains shift and reshoring efforts are put into place, you need assurance that the parts being produced meet your quality expectations.

In his role, Driver talks with numerous manufacturers and fabrication shops across the country. What they are saying is that the cost benefit of outsourcing no longer outweighs the occasional quality issue with parts.

“The past two and a half years have really shown quite a disruption in the methodology for outsourcing, especially to areas like Asia. In the past, the decision to outsource was based primarily on cost, and if you had a quality problem you still came out ahead because the total landed cost was still lower than the material cost.”

But that is no longer the case as Driver explains in this clip:

 

 

How Do I Find Quality Skilled Labor?

Over the past 12 months, the U.S. manufacturing industry has added nearly 500,000 jobs, equating to the largest workforce in this industry since the Great Recession. Despite this fact, the labor gap remains wide given the roughly 800,000 job openings that remain in this industry, according to the U.S. Labor Department.

So, it begs the question: How do you effectively bring production closer to home when you struggle to fill the headcount inside your own four walls? In a word, that answer, says Porter, is automation.

Back to the ABB study that found 70% of U.S. businesses have planned reshoring efforts. Roughly 62% of these business plan to invest in automation in the next three-to-five years to help facilitate this shift in operations.

Despite the appetite for automation, the survey found a significant gap in the education and training needed to ensure the skills necessary for work in the increasingly connected and automated workplaces of the future.

Porter addresses how Ryerson’s investments in automation are helping close the labor gap.

 

 

“Through automation and other methods, we are finding that we can some up with supply chain solutions to make near shoring a much more viable option and to keep more cash in your pocket and more space on your floor to make your product,” says Porter.

Are you ready to talk about how Ryerson can become your nearshoring manufacturing solution?

Reach out to us for a conversation at RAP@ryerson.com

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