Dealing with supply chain implications of backshoring decisions: insights from Belgian and French companies

Details

Supervisors

Kamp, Bartholomeus

Faculty

Louvain School of Management

Degree label

Master [120] : ingénieur de gestion, à finalité spécialisée

Abstract

The trend of backshoring, whereby companies relocate production activities from abroad back to their home countries, has gained significant attention in recent years. Driven by the need for better production control, reduced lead times, and risk mitigation in global supply chains – further intensified by geopolitical tensions and the COVID-19 pandemic – this shift carries substantial implications for the supply chains of companies that implement this strategy. While the focus is on backshoring, the thesis also considers reshoring moves, specifically the repatriation of production activities to neighboring countries of a company's home base. This thesis aims to provide an understanding of the implications of these moves on supply chains, and also examines how companies manage the associated challenges. To this end, this work begins with an analysis of existing literature, offering a strong basis for understanding the historical context, motivations, and barriers for backshoring, as well as key supply chain implications. The primary research conducted for this thesis analyses and presents valuable insights from seven Belgian and French companies which employed this strategy. The results and discussion of the findings are structured using frameworks such as the Kraljic Matrix and Di Mauro et al.'s (2018) backshoring motivation matrix. This research reveals that the implications of backshoring are multifaceted. They include general aspects such as risk mitigation and the impact on the length of the supply chain, as well as more specific elements including changes in sourcing and suppliers, changes in manufacturing processes and production, transport considerations and inventory management.