Back-Shoring vs. Near-Shoring: A Comparative Study

After decades of manufacturing offshoring strategies, generally addressed to low cost countries, in the last few years companies have been increasingly revising their location strategies. In so doing, they often implement either back-shoring (relocation to the home country) or near-shoring (relocation to the home region) alternatives. While the former strategy has gained increasing attention among scholars in recent years, studies on near-shoring are still scarce. Moreover, the academic literature rarely compares the two phenomena in order to understand why companies prefer to implement one instead of the other. This paper aims to shed new light on similarities and differences among back-and near-shoring strategies. In order to reach such an objective, we assume a contingency approach by focusing on a specific industry, the footwear sector, which has been significantly characterized by offshoring strategies. In order to reach the research aim, the comparison between back-and near-shoring strategies will be conducted focusing on three main issues: A) characteristics of the companies implementing the relocation strategy (firm's size); b) motivations inducing companies to relocate; c) barriers to the implementation of the relocation decision. Given the explorative nature of the paper, the features of 41 back-and near-shoring decisions implemented by 25 Italian and Spanish companies operating in the footwear industry will be analysed. Preliminary findings show smaller companies are more likely to back-shore instead of near-shore, probably because of the lower competences and resources they own. At the same time, availability of skilled contractors and/or availability of government aid in the home country induce them to back-shore instead of near-shore. Finally, the lack of skilled suppliers mainly characterizes the back-shoring alternative.