Nearshoring

Related terms

Reshoring

Reshoring is moving production that had been offshore back to the buyer's home country. Buyers reshore to shorten lead times, cut inventory, reduce tariff and freight exposure, and protect intellectual property. It pays off when quotes are compared on landed cost, not piece price.

Landed cost

Landed cost is the total cost of a part delivered to the buyer's dock, including piece price, tooling amortization, packaging, freight, insurance, duties, tariffs, brokerage, and inventory carrying cost. Comparing offshore and domestic quotes on piece price alone understates the cost of the offshore part.

Tariff

A tariff is a tax on imported goods, collected in the US by Customs and Border Protection and set by the product's HTS code and country of origin. Beyond base duty rates, added tariffs such as Section 232 and Section 301 duties can change with little notice.

Dual sourcing

Dual sourcing is qualifying two suppliers for the same part so production can continue if one has a capacity, quality, or supply problem. It usually costs more than single sourcing because of duplicate tooling and split volume, and buyers weigh that cost against supply risk.