Reshoring decisions and redesigning the supply chain. The case study of a bike manufacturer

Abstract

Purpose Global value chain in the bike industry is complex due to the wide number of product models and involved players (suppliers of components, assemblers and distributors). In general terms, top bike manufacturers design their products and outsource the manufacturing of most of the components and subassemblies; the final product is usually assembled within the manufacturers’ plants, although sometimes this operation is also outsourced. During the last decades manufacturing and assembly operations have been offshored due to different reasons, and later, on some occasions, these decisions have been revised relocating (at least partially) production activities either in the home country (backshoring) or the same region (near-shoring). Scholars have been studying the different drivers for offshoring and reshoring decisions in different industries (Dunning, 1998; Ellram et al., 2013; Gray et al., 2013; Fratocchi et al., 2014; Tate et al., 2014; Bals et al., 2015; Foerstl et al., 2016; Tate and Bals, 2017; Di Mauro et al., 2018) and after Covid19 pandemic (Barbieri et al., 2020). The Covid19 pandemic and recent crisis have provoked peaks in demand and shortages and supply disruption have occurred in many different sectors, raising the discussion in Europe and North America about producing locally, reshoring initiatives and redesign of supply chains to become more resilient and responsive.

This research article analyses the offshoring and reshoring decisions as well as the design of the supply chain of bike manufacturing, and the evolution of the production footprint identifying the drivers and barriers. The research is based on a case study about one of the top European bike manufacturers (+200m€ turnover, +800 employees, + 50% export sales).

Purpose Global value chain in the bike industry is complex due to the wide number of product models and involved players (suppliers of components, assemblers and distributors). In general terms, top bike manufacturers design their products and outsource the manufacturing of most of the components and subassemblies; the final product is usually assembled within the manufacturers’ plants, although sometimes this operation is also outsourced. During the last decades manufacturing and assembly operations have been offshored due to different reasons, and later, on some occasions, these decisions have been revised relocating (at least partially) production activities either in the home country (backshoring) or the same region (near-shoring). Scholars have been studying the different drivers for offshoring and reshoring decisions in different industries (Dunning, 1998; Ellram et al., 2013; Gray et al., 2013; Fratocchi et al., 2014; Tate et al., 2014; Bals et al., 2015; Foerstl et al., 2016; Tate and Bals, 2017; Di Mauro et al., 2018) and after Covid19 pandemic (Barbieri et al., 2020). The Covid19 pandemic and recent crisis have provoked peaks in demand and shortages and supply disruption have occurred in many different sectors, raising the discussion in Europe and North America about producing locally, reshoring initiatives and redesign of supply chains to become more resilient and responsive.

This research article analyses the offshoring and reshoring decisions as well as the design of the supply chain of bike manufacturing, and the evolution of the production footprint identifying the drivers and barriers. The research is based on a case study about one of the top European bike manufacturers (+200m€ turnover, +800 employees, + 50% export sales).