Question

Use the internet to complete a discussion on the disadvantages of U.S. companies using Chinese supplier that might drive them to near shore their supply chains. Please include the source where your find the information and please no copy and pasting..

Answer 1

The growing tension between the US and Chinese trade especially after the change in US administration has become one of the most significant implications for companies based in the US to consider nearshoring as a viable alternative to China and the availability of labor there.

The biggest disadvantages/cons that can be observed when a US-based company offshores its processes to China are:

1. Monitoring, especially when a US-based company needs to provide the oversight for an important project becomes a hindrance, given the specific differences of the time zones, culture and language.
2. Maintaining constant communication with the facility, especially in a remote place like China can slowly pile up to become costly.
3. Traveling expenses, especially when a team needs to move back and forth can raise cost concerns.
4. The increasing cost of operation in China has created an understanding of other alternatives being better, for example, Latin American regions that provide a lower price of function and virtually the same service level.

#We cannot provide a direct link to any web-based resource due to Chegg’s policies. I have sourced the information from the HBR article, “What’s next when offshoring isn’t so cheap?”.