Reshoring is not a dream, the trend is going on

Reshoring became popular as word only recently, meaning the process of returning the production and manufacturing of goods back to one’s own country, more consistent in highly manufacturing-based economies. First signals and evidences were gathered and analyzed by the UniClub MoRe Back-reshoring research group starting from 2009. From 2014 on, the occasions to mention this concept about Italy grew significantly. Was it only a hope or is it really happening that production and plants are moved back to Italy? Is it still an opportunity limited to a very restricted to a niche?

Italy is actually facing a reshoring age, as well explained by Il Sole24ORE here and Lombardy plays a key role, with 18 reshoring cases. Italy, with totally 121 reshoring cases is the second destination after US. Disappointment about logistics and labour costs experienced during off-shoring are the main reason declared by companies currently reshoring.  

After our first analysis in December 2014, we can add now more evidences to comment the trend, thanks to stories like the returning home of Felm and Artsana.

Felm, a company based in Inveruno (province of Milan, next to Malpensa airport), was a pioneer in delocalizing to China, but back-shored last year part of the production of electric engines.

Artsana is a group born in Grandate (in the province of Como) and dedicated to baby care, health and beauty care. Now well represented all around the world and known for brands like Chicco, Artsana has decided to strengthen its presence in Lombardy, bringing back production lines delocalized ten years ago in China.

There are many reasons and signals showing a potential trend in reshoring, not only in the fashion industry (the first one showing interest in the process) but also in mechanical industry and generally in the manufacturing industry.

The robot automation is the first: adding automation to the production processes, the advantage of moving the production very far becomes less important. If the role of labour decreases and the impact on the costs, why not having the plants next to headquarters?

But also the opposite in valid: if the role of labour strongly affects the costs and the labour is defining the quality of goods and has to be performed by experts or craftsmen, then why not producing where craftsmanship is diffused and the quality of labour force is extremely high? This concept is the one applied by the fashion industry, which saw a reshoring trend only for high-end fashion. Now many analysts are forecasting also a possibility of reshoring for that part of textile industry where innovation and digitalization are the key success factors, like technical textiles and nonwovens.

The concept of reshoring is linked to investment attraction, because a company thinking about reshoring is confirming twice the territorial attractiveness.

After having delocalized, (due to changes and improvement in infrastructure, tax system, economic climate), the enterprises are reshoring showing how much their once left native territory is still and again competitive.

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