Industry 4.0 like a driver for Reshoring decisions

What is Industry 4.0 has been repeated often. But how is this phenomenon related to Reshoring?

 

Manufacturing Reshoring means the managerial decision for returning to the country of origin the production of a company that had previously been relocated to foreign establishments. The choice to locate production in foreign countries is due to better conditions in terms of demand and/or supply. Prediction of cost savings can cause companies to move abroad, often in developing countries.

Today, the consumer is even more careful to quality, design, customization and durability of the product and not just to the price.

Industry 4.0: a powerful machine that allows you to mix cost savings and customer satisfaction.

 

The ability to modernize the production process and increase the company’s productivity has a positive impact on the Reshoring phenomenon: both in the innovative and traditional sectors.

On the one hand, the investment in technological evolution allows companies to grow intelligently, increase productivity and reduce costs, from the other it gives the company the ability to return to the country of origin. Through this return  the firm re-gains the recognized value at the Made In. The latter represents an important driver for Reshoring decisions.
There are other reasons that push a company to make this inversion such as:

  • the search for better production quality;
  • improve customer service;
  • lower logistics costs;
  • innovation;
  • Corporate reorganization.

 

Choosing to return to your country does not depend exclusively on factors of economic nature.

The volume expansion and the costs reduction offered by Industry 4.0, combined with the specific skills of workers in a particular country, allow a continuous product and process innovation which create value.

The modernization of the production process, which may reduce costs, and the increase of the customer’s perceived value is a combination of factors that can lead the smart factories to combine a process regineering and return at home.