An increasing amount of companies opt for reshoring: they are reviewing their business model and are bringing back jobs to their own region. This makes reshoring a sizeable model of innovation. Midden-Brabant is ahead of the market. Tilburg has set the example with a large number of manufacturing companies and a reshoring tool developed by Tilburg University.
Reshoring is more than just transferring production from overseas. As a matter of fact, it is the opposite of offshoring. It means reconsidering a company’s business model. Companies look at what they manufacture, what they outsource and what new activities they can engage in. To this end, they make their business case transparent by looking at the costs and opportunities.
Stay or go back?
All entrepreneurs deal with these crucial questions: which is the best location for manufacturing? What do I outsource? What do I keep in-house? The latest developments make it interesting and important for entrepreneurs to redefine, and possibly consider, their business case. Quite possibly, the sum of all costs and circumstances could lead in some cases to the strategic decision to stay or to relocate production after all. If this is the case, it is important that entrepreneurs are helped to gain insight in the so-called total cost of ownership: all direct and indirect costs.
A calculation tool has been developed with the help of Tilburg University that helps companies to weigh up their costs and benefits. The results differ, but the difference in costs can be as much as 30%. Companies that produce in part overseas or that have outsourced their purchasing or repairs can review their business case with the Reshoring Tool. It is possible to do this under the expert supervision of the collaborating parties. These parties also ensured that companies can make use of specific schemes such as the creative industries fund.
Manufacturing industry is taking off
‘For many years, people in the Netherlands had the idea that the manufacturing industry was on its last legs,’ says Ton Wilthagen, professor of labour market studies at Tilburg University and initiator of the reshoring tool. ‘The manufacturing industry was all but declared dead. The crisis taught us that economies with a strong, modern manufacturing industry, such as in Germany, are the ones that are able to survive the storm. In that respect, the Dutch economy with its large service industry is quite vulnerable. Luckily, what we are seeing is that the manufacturing industry is valued again and that an increasing number of young people opt for a technical education.’
The Reshoring Connection
The Reshoring Connection has been established to support companies. Midpoint, Tilburg University and the Hart van Brabant municipalities are the initiators of The Reshoring Connection. Numerous companies in Tilburg are already doing quite well. For example, CAPI Europe, Smartwares, All Tape Supplies, CUPZ, Smartwares Group, BOA Group and SNRDPTY.