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What is Nearshoring, and Why Are We Still Talking About It?
Nearshoring—relocating manufacturing or sourcing closer to the point of consumption, especially from Asia to Latin America or parts of Eastern Europe—has re-entered the spotlight in 2025.
At its core, nearshoring promises faster lead times, fewer geopolitical risks, and improved sustainability. But behind the buzz, professionals like us—especially those managing sourcing and production out of the U.S.—are now asking: does the math still make sense?
How Nearshoring Has Evolved in 2025
Nearshoring first surged post-COVID, driven by freight volatility, supply shocks, and rising China skepticism. In 2025, the story has shifted again:
Labor cost arbitrage is narrowing. Mexico, Central America, and even Turkey are seeing rising wages, though still lower than China in some sectors.
AI and marketplace models (like Nearshore’s new B2B platform) are reshaping how buyers connect with suppliers across Latin America and Europe.
Denim and apparel leaders like Artistic Milliners and Cone Denim are doubling down on Mexico for design-speed responsiveness.
New tariffs imposed by the U.S. government in Q2 2025—especially on textiles, electronics, and auto parts from China—have made cost comparisons more complicated than ever.
When Nearshoring Makes Sense
From my experience working with global vendors and factories, here’s where nearshoring actually pays off:
Short-cycle fashion: Trend-driven items or seasonal drops with unpredictable demand.
Private label brands: Looking to reduce inventory risk.
Retailers testing new markets: Who need small-batch or fast feedback loops.
Categories affected by tariffs: Apparel, electronics, and industrial tools now facing higher duties from China.
But It’s Not a Silver Bullet: The Practical Hurdles
As much as we’d all love to shorten our supply chains, nearshoring comes with its own challenges:
Limited raw materials access in LATAM compared to Asia.
Supplier capacity constraints, especially during peak seasons.
Quality consistency issues with newer vendors.
Trade agreements and labor regulations that are still evolving in key sourcing hubs like Mexico and Colombia.
We also must be honest: many of us rely on deep, multi-year relationships with our Asia-based vendors. Their commitment, flexibility, and technical capabilities are irreplaceable. If you’re reading this as one of them—thank you.
A Reality Check: Is It Worth It?
Nearshoring is no longer just a “supply chain buzzword.” It’s a strategic lever—but only when used in the right context.
Think of it as a portfolio strategy: not replacing, but complementing, your global sourcing network.
Done right, nearshoring can de-risk your operations, improve responsiveness, and even reduce costs—but it requires serious planning, trust-building, and operational support on both ends.
Conclusion: What's Next?
As professionals navigating an increasingly complex supply chain, we can’t rely on buzzwords. We need better data, transparent supplier relationships, and flexible sourcing models that respond to both opportunity and risk.
Nearshoring is here. But only you can decide if it’s the right move for your business.
If you’re navigating any of these questions or just want to understand how things work better—ask away. I’d be happy to share what I’ve seen, learned, or built over the years.
Sources:
Bain & Company | International Bar Association | Sourcing Journal – Denim Nearshoring | Supply Chain Dive | BoF State of Fashion 2025 | BusinessWire – Nearshore AI Marketplace | Sourcing Journal – Marketplace Launch
Disclaimer
The views expressed in this blog are entirely my own and do not represent those of my employer or any of our partner brands or vendors. The scenarios and observations described here are based on general industry patterns I’ve seen across markets over the years. If any section appears to misrepresent or oversimplify a specific case, I assure you it’s unintentional. I’d be happy to correct or update anything—just drop me an email.