Near-shoring is taking on ‘the Amazon effect’: the need for rapid response to customer needs. A recently released study by LMA Consulting Group indicates that 70% of US manufacturing executives expect near-sourcing to increase within the next five years.
“I’ve seen that manufacturers were already considering insourcing to the US and near-sourcing options to Mexico and other closely located countries because of the Amazon effect,” said LMA president Lisa Anderson.
She adds that industry was already moving in that direction prior to the US presidential election. “However, since tariffs are likely to increase and bad publicity could easily occur, the impact will probably steer some of those companies towards the US instead of Mexico,” she said.
Data for the survey was collected between August and October 2016, before the US election. At that time, Ms Anderson remarked that she expected tariffs to increase. Since then, president Donald Trump has threatened to impose a 35% tax on US companies that move jobs overseas, including Mexico.