Bringing Them Home: Reshoring Supply Chains Is Not a Panacea
The Conference Board of Canada, 14 pages,
October 20, 2020
This briefing looks at the impacts of the COVID pandemic on Canadian businesses’ supply chains and the trend toward reshoring.
- Responding to the Global Commerce Centre’s recent trade survey, many organizations said they had shifted their supply chains more toward domestic suppliers during the pandemic.
- An even greater share of survey respondents said they are planning to source more inputs from local suppliers after the pandemic is over.
- In terms of disruptions, COVID-19 containment measures caused the most problems when sourcing inputs from China, followed by inputs from other parts of Asia and the Americas (excluding Canada and the United States).
- The pandemic also disrupted the supply chains of organizations sourcing inputs domestically. As such, bringing home supply chains is no guarantee of supply chain security and resiliency.
- Not all industries were affected equally. Health care services stand out as one of the most affected industries. High-value services, such as professional, financial, and information technology services, were among the least affected.
- A firm can improve the robustness and resiliency of its supply chain by better preparing for disruptions. This can include a combination of approaches. For example, a firm can develop a network of trusted suppliers. It can also use digital technologies for a more agile management of supply chains and stress tests to help make more informed decisions.