13 August 2012

Reshoring on the rise says EEF

Increasing numbers of manufacturers are bringing production back in-house and increasing their hunt for local supply capability in response to increased disruptions to supply chains caused by recession and natural disasters, according to a new survey.

The survey, from the manufacturers' organisation EEF, highlights the globalised nature of manufacturing and its supply chains, a trend that it says brings the potential for disruptions to cause business continuity risks. The survey shows companies are alive to such threats; one third of companies viewing it as a board level matter.

Four in 10 manufacturing companies in the survey said they were bringing production back in-house, while a quarter had increased their use of local suppliers.

Other findings from the survey show:

· The average manufacturer has 190 suppliers, with one in five saying half their suppliers were located outside the UK.

· Around a quarter of manufacturers have seen an increase in the use of suppliers outside the UK in the past two years.

· The most significant impacts on companies from disruptions were loss of orders and loss of revenue.

· Actions to improve supply chain resilience have included better inventory management; increasing collaboration and forward planning with suppliers and investment in IT to improve supplier management.

· Despite the potential risks to disruption the survey also showed that only 11% of companies monitor their entire supply chains and 16% of companies do not monitor their suppliers at all.

Author
Ken Hurst

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