The case for nearshoring
Global supply chains are undergoing a structural shift. As tariffs, geopolitical uncertainty, and freight volatility continue to impact long-distance sourcing, companies are increasingly turning to nearshoring as a strategic response. In fact, a majority of businesses affected by tariffs have already prepared or executed dual sourcing and nearshoring initiatives, and procurement leaders overwhelmingly cite alternate supply chains as the most effective risk mitigation strategy. Foreign direct investment trends further reinforce this movement, with capital accelerating into Latin America while declining sharply in traditional offshore hubs. Nearshoring is no longer a theoretical option - it has become a practical requirement for companies seeking resilience and long-term stability.
Moving production closer to the U.S. strengthens supply chain resilience while improving operational performance. Shorter transit times increase responsiveness, enable faster product iteration, and reduce inventory exposure. Geographic proximity supports lower minimum order quantities, decreases working capital tied up in inventory, and limits the financial impact of disruptions such as stockouts or emergency air freight. In addition, reduced transportation distances cut emissions and improve supply chain transparency, supporting ESG objectives. Nearshoring is not simply about location - it is about building a more predictable, flexible, and sustainable manufacturing model for long-term growth.
Sources: Deloitte Consulting LLP; McKinsey & Company; Inter-American Development Bank