Backsourcing is due to poor quality

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Source: METAL SUPPLY, Friday 03 May 2013
By Stefan Buur Hansen
- Link to article (Metal Supply / Danish) >>
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But also long delivery times and inflexibility are some of the reasons among Danish companies that choose to backsource production from abroad.

It remains only a tiny proportion of Danish companies that choose to pull their outsourced production back to Denmark through the so-called backsourcing.

This is shown in the new figures from Statistics Denmark, which has been monitoring the market for two periods from 2001-2006 and 2009-2011.

During both periods 17 percent of the approximately 5,000 investigated companies had outsourced to foreign countries, while only 1.8 percent had backsourced production since then.

Poor quality and lack of flexibility
"It is primarily the core business of companies, ie. production being moved back home; 3 out of 4 companies moved its core business back home. Companies in the industry represented 63 percent of the backsourcing companies in the period 2009-2011. Among the companies in the industry which backsourced, moved an entire 86 percent of their core activity back", Statistics Denmark concludes.

The companies which despite everything backresources, draws in particular the production home from Europe and China. Those places in particular were the ones to which the production was outsourced in the first place.

Companies justifies the backsourcing by pointing out frequent causes such as insufficient quality, long delivery times and problems with flexibility of the suppliers.

- Link to article (Metal Supply / Danish) >>