Profitable proximity

Abstract

Manufacturers in western Europe are facing a number of key challenges in addition to the current financial crisis. In this global manufacturing world, demand is being driven by emerging markets, and European manufacturers need to be able to target the developing middle classes in places like India, including producing goods locally. Another major challenge centres on the supply chain - the increasing cost and scarcity of raw materials, rising labour costs in China, and the impact of the environmental footprint. The drive to reduce supply chain costs comes as European manufacturers are also seeking to be more responsive to customers and to collaborate more with suppliers. So supply chain strategies are now about balancing cost with agility.