Nearshoring Not a Passing Fad

Nearshoring Not a Passing Fad

July 12, 2023
In an updated survey, 43% of CEOs said they had actively looked at onshoring and nearshoring some or all of their supply chains.

In an updated survey from Proxima, which was comprised of 2,000 CEOs of UK and US-based companies, CEOs were asked about the biggest issues and concerns businesses have regarding global supply chain challenges. 

Here are a few highlights from the survey.

Layoffs and nearshoring are not a passing fad

Inflation has forced job cuts across industries as businesses look to save on costs. The biggest stories hitting headlines have been coming out of the tech sector, but over a third (36%) of CEOs across industries are still considering layoffs to mitigate the impacts of inflation.

This figure soared by almost 10% in comparison to responses to the same question last year, and layoffs are being increasingly seen as a good option to mitigate cost pressures.

Similarly, nearshoring, friendshoring, and onshoring are all being looked into by organizations as certain geopolitical relations sour and threaten to disrupt supply chains.

Last year, just over a quarter (26%) of CEOs told us that they had actively looked at onshoring and nearshoring some or all of their supply chains.

That number has now grown; over four in ten (43%) of CEOs with resilience problems are already either onshoring or considering it as an option.

Businesses are failing to put action behind their commitments to decarbonize

When asked last year, a quarter of CEOs surveyed said that they had been forced to delay their plans to decarbonize due to the impact of inflation. The picture is looking a little brighter this year, with 34% of those surveyed saying that they have a formal business plan in place for decarbonization.

Ultimately, however, this progress is not moving fast enough, and the reasons behind this sluggishness range from the complexity of the work involved, the cost, and the lack of access to data.

The challenge of decarbonizing supply chains is vast, and if businesses want to keep up with their commitments, it’s essential they learn from one another to accelerate action.  The recent Scope 3 Maturity Benchmark revealed the same symptoms: investment, talent, and credible strategies and planning are all lagging behind organizational commitments. 

Human rights issues are a key concern

In recent years, some high-profile companies have come under fire for human rights violations in their supply chains, and legislation has been tightened. These shifts are clearly plaguing the minds of CEOs, with 69% of respondents saying that they are concerned about the potential for human rights issues within their supply chains.

Given the recent scrutiny of the fashion industry, the retail sector is the most preoccupied with this issue, and close to 8 in 10 (79%) of CEOs said it was a key concern.