A network perspective on the reshoring process: The relevance of the home- and the host-country contexts

Abstract

While research on reshoring generally focuses on the host-country to explain why a company brings its previously offshored activities back home, this paper stresses the relevance also of the home-country context. Specifically, relying on the IMP (Industrial Marketing & Purchasing) perspective we show how offshoring and reshoring processes and decisions are both enabled and constrained by the micro-interactions and interdependencies in the industrial networks stretching over the home-country and the host-country. This work relies on a longitudinal case study about an Italian manufacturing firm to develop a model indicating how offshoring/reshoring is a long-term process which unfolds depending both on the focal firm's strategy and on its interplay with the embedding network. Next to this interactive process perspective, we contribute to the literature on reshoring and the global factory also the concept of “selective reshoring”, whereby companies bring back a very specific sub-set of activities, which were previously fine-sliced and offshored, and re-embed these activities in their local home context. The more flexible and selective nature of this relocation of activities between different supply markets depends both on the firm's strategy and on the structure, overlap and evolution of the network elements located in the home- and host-country contexts.