How reshoring can supercharge production

In this article, Contract Production’s senior marketing executive, Clarke Roberts, identifies eleven reshoring benefits, from cost savings to reduced environmental impact.

Subcontract electronics is one of the most competitive industries, with hundreds of organisations across the world vying for business. When choosing a subcontract electronics partner, opting for an offshore manufacturer may seem attractive. Overseas firms often offer lower prices and larger production capacity. However, what appears too good to refuse is usually too good to be true.

The most important things to consider when choosing an electronics manufacturer are reliability and how invested they are in the work. Having spent time and money on a project, OEMs want whoever they work with to be as equally excited and enthusiastic. With this in mind, working with an electronics manufacturer halfway around the world doesn’t immediately appear a recipe for success, often fostering an impersonal relationship via a computer screen. Also, working across multiple time zones and, in some cases languages, can affect working closely together, which is crucial to the development of a successful contractor-client relationship. Covid-19 has also disrupted international supply chains, impacting delivery reliability from overseas partners. 

More and more British businesses are reshoring their electronics manufacturing operations. Why, because it makes good sense and for a host of reasons. The following are 11 reasons why reshoring electronics manufacturing can supercharge production lines.

1) Closer communication: As mentioned, working with overseas partners can be a challenge. Language barriers and time zone difference can make developing an effective relationship tricky. By reshoring and choosing a UK-based partner, these challenges can be overcome.

2) See the work for yourself: Although travelling the world sounds rather appealing, having quick access to a manufacturing partner is a vital part of the relationship. Witnessing the work they’re doing and seeing a project come to life provides confidence it’s proceeding as planned.

3) Higher quality: This is a key selling point of reshored manufacturing. British manufacturing is renowned the world over and China often imports electronics solutions for particular applications.

4) Better cashflow: Offshore partners regularly insist on partial or full payment with order. With potential lead times of several months from order to fulfilment, cashflow becomes important. Also, most overseas organisations complete transactions in US Dollars, likely leading to pricing fluctuations between order and fulfilment. Reshoring lets OEM’s take advantage of operating in one local currency, providing peace of mind and full cashflow control.

5) Facility inspections: Offshore providers may offer expected quality levels but facility inspections are more difficult when they’re thousands of miles away. It’s essential for OEMs to protect their reputation by ensuring they are involved in an ethical production chain. Strict UK employment laws cover everything from workers’ rights to anti-slavery. Overseas companies may not be subject to the same level of regulation.

6) One-stop solution: Electronics manufacturing often comprises more than just PCB assembly. Developing prototypes, testing board layouts and making changes to final designs all form part of the process. Reshoring allows more flexibility to choose a one-stop partner offering all these services, reducing costs and saving time.

7) Reduced delivery times: Even in today’s hyper-connected world, there’s no escaping the enormous role geography plays in business. Reshoring means orders may be fulfilled quicker, reducing the time it takes to get a project from factory floor into customers’ hands.

8) Reduced delivery costs: as above, the closer an OEM and its manufacturing partner are, the cheaper it will be to have things delivered.

9) Reduced carbon footprint: Shortening the distance goods have to travel also reduces the environmental impact, which should be a focus for every business. Also, it may be possible to reduce the amount of packaging or consider reusable packaging with a more local supplier.

10) Reduced supply chain risk: Local supply chains are often far simpler to work with and offer greater flexibility when external factors such as Covid, customs and international couriers cause disruption.

11) Lower minimum order requirements: Using local suppliers often means smaller orders are more practical, which lessens the level of commitment needed from the business.