1. Why do you think moving the supply chain tends to be a knee-jerk reaction when tariffs rise or trade tensions flare?
It’s a reaction that comes from a place of urgency. Tariffs go up, or trade tensions escalate, and there’s a natural impulse to act quickly – especially when there’s pressure from leadership or shareholders. On the surface, moving a supply chain seems like a strong, decisive move. But in reality, it’s rarely that simple.
More often than not, relocating is a reaction to symptoms rather than strategy. Companies that take a step back and model the full impact – including the hidden costs – usually find the situation is more nuanced. As I’ve seen firsthand, staying put can often be the smarter call when you factor in the broader operational picture.
2. What’s the best way to assess total landed cost when considering a relocation?
You really need to go beyond tariffs and labor rates. A solid total landed cost analysis should include freight costs, customs duties, inventory holding, quality risks, and the cost of time – how long it’ll take to requalify a new supplier or ramp up a new site.
You also want to include softer but very real risks: supplier reliability, logistics infrastructure, responsiveness, and even talent availability. In my work, we use a scenario-based approach that models different outcomes – best case, most likely, worst case – because it’s rarely a linear comparison. You’re not just swapping one cost center for another; you’re rebuilding an ecosystem.
3. What’s the potential cost of relocating too quickly? Is there anything companies tend to overlook?
Yes – and quite a few things, actually. A big one is requalification, especially in regulated sectors. That process can take months and delay your go-to-market timeline significantly. Another is supplier know-how. Longtime partners often bring embedded knowledge – whether that’s tooling nuances, production techniques, or troubleshooting expertise – that’s hard to replicate elsewhere.
Companies also tend to overlook the operational strain. Transitioning a supply chain can drain resources internally – procurement, quality, engineering – and if you’re already stretched, that can be a real problem. Rushing into a move without a proper risk buffer can end up being far more expensive than the tariff you were trying to avoid in the first place.
4. How should companies weigh short-term political or economic incentives against long-term resilience?
It’s a balance. Short-term gains – like avoiding a specific tariff – can be compelling. But the question we often pose to clients is: Will this decision still hold up two or three years from now? Because trade policies change, political winds shift, and if your new setup is fragile, you’re simply moving from one kind of exposure to another.
Resilience is about building supply chains that can absorb shocks. That might mean sticking with a higher-cost geography because of consistency, or diversifying – not relocating – to mitigate risk. If you can model both short-term and long-term impact, and stay aligned to your strategic goals, that’s where smart decisions emerge.
5. What should companies look at when evaluating whether a country’s infrastructure or labor pool can support their supply chain needs?
There are a few core questions to ask: Can the region support the technical complexity of your product? Is the infrastructure – ports, roads, utilities – reliable? Is the labor market deep enough, and are the right skills available? And what’s the regulatory environment like – predictable, or prone to sudden shifts?
We always advise talking to companies already operating in the region. That real-world feedback – on logistics bottlenecks, compliance challenges, or workforce availability – can often highlight issues that aren’t immediately visible from data alone.
6. In your experience, what are the signs it’s time to seriously consider relocating sourcing or manufacturing?
When the risks become structural – not just a one-off disruption or a temporary cost spike. If your supplier can’t meet compliance or ESG standards, if you’re consistently seeing quality or delivery issues, or if the geopolitical environment starts affecting your ability to operate with confidence – that’s when a relocation conversation becomes necessary.
It’s also important to remember that “relocating” doesn’t always mean a full exit. Sometimes it means adding a secondary source, or shifting one tier of the supply chain, while keeping core capabilities in place.
7. How long should companies expect a country-to-country shift to take, realistically?
If we’re talking about a full shift – from decision to full production ramp-up – it’s usually 12 to 36 months. That depends on the industry, of course. A low-complexity product in a lightly regulated sector can move faster. But high-spec manufacturing? With quality controls, tooling transfer, compliance certification? That takes time – and trying to compress that timeline often leads to serious issues down the line.
8. What technologies or tools are helping companies make better sourcing location decisions now than in the past?
We’re seeing a lot of progress here. Companies are using AI and predictive analytics to model risk exposure and simulate cost scenarios. Digital twins are gaining traction – they let you map your supply chain virtually and test what would happen under different disruptions. Supplier risk platforms are also far more sophisticated, incorporating ESG data, political risk scores, and even weather patterns.
Five years ago, this kind of real-time scenario planning wasn’t widely available. Now it’s increasingly essential.
9. Given current conditions—tariffs, geopolitical risk, ESG pressure—how much more complex do you expect supply chains to become by 2030?
Significantly more complex. We’re already seeing how global trade isn’t just about economics anymore – it’s about national security, sustainability, and data sovereignty. And that’s driving more regulation, more reporting requirements, and more pressure to be agile. Add in climate volatility and changing consumer expectations, and you’re looking at a supply chain environment that’s constantly in motion.
The companies that thrive will be the ones that build optionality into their supply chains – and invest in visibility, partnerships, and technology to stay ahead of the curve.
10. Anything else to add?
Yes – just that sometimes, the smartest move is to stay where you are and optimise. It may not feel as bold as a relocation, but doubling down on what’s working – while building in resilience and flexibility – can be just as strategic. It’s not about reacting to headlines. It’s about making decisions that hold up in the long run.
- Sourcing & Procurement