Reshoring in the Context of U.S. Tariff Policy: A Strategic Framework for Sourcing and Procurement

Reshoring and U.S. Tariff Policy: What’s Driving the Shift?

Reshoring—the process of bringing manufacturing and services back to the home country—has gained significant traction amid recent U.S. trade policies. In March 2025, the Trump administration introduced sweeping tariffs, including a 25% duty on imports from Canada and Mexico and an increase from 10% to 20% on Chinese goods. These measures aim to incentivize domestic production, as Vice President JD Vance emphasized: “The way to avoid the application of tariffs is to have your factory and facility in the United States of America. Invest in America, and you avoid the penalty of these tariffs.”

While the policy seeks to bolster U.S. manufacturing and job creation—backed by major unions—it also raises costs for businesses reliant on imported goods. Retail giants like Walmart have already signaled impending price hikes for consumers. For procurement leaders, this creates an urgent need to rethink sourcing strategies, balancing cost, risk, and resilience.

The Many Faces of Reshoring

Reshoring isn’t a one-size-fits-all approach. Companies can choose from multiple strategies to align with their goals:

1. Reshoring: Fully relocating production to the U.S. to leverage domestic resources and avoid tariffs.

2. Nearshoring: Shifting operations to nearby countries like Mexico or Canada for proximity and cost benefits.

3. Friendshoring: Partnering with allied nations, such as India, to ensure stable trade relationships.

Each option offers unique advantages, and at Sumedian.com, we help businesses scout the best suppliers and assess these pathways to minimize risks and optimize costs.

Key Drivers Behind the Reshoring Trend

Beyond tariffs, several factors are fueling the reshoring movement, making it a strategic imperative for modern procurement:

Economic and Operational Shifts

Historically, offshoring was driven by low labor costs overseas. However, rising wages in countries like China, combined with advancements in automation and robotics, have made U.S.-based production increasingly competitive. Economist Peter Navarro has long argued that offshoring critical industries like steel and aluminum weakened U.S. manufacturing—tariffs are now reversing that trend.

Supply Chain Security

The COVID-19 pandemic exposed the fragility of global supply chains, with disruptions causing shortages and delays. Since 2019, U.S. manufacturing construction has surged by 195%, reflecting a push to bring production closer to home and reduce reliance on distant suppliers.

Sustainability Benefits

Reshoring shortens transportation routes, cutting emissions and aligning with corporate sustainability goals. For eco-conscious companies, this is a win-win, enhancing both profitability and environmental responsibility.

A Strategic Framework for Sourcing and Procurement

To thrive in this reshoring era, businesses need a robust procurement framework. At Sumedian.com, we’ve developed a four-pillar approach to guide our clients:

1. Cost Management and Value Creation

Tariffs may increase costs, but smart procurement can offset the impact. Through Total Cost of Ownership (TCO) analysis, competitive RFQs/RFPs, and demand planning, we help clients achieve measurable savings while maintaining quality.

2. Risk Management and Supply Assurance

Assessing supplier financial stability, geographic risks, and contingency plans is critical. We scout diverse suppliers and implement multi-sourcing strategies to ensure uninterrupted supply chains, even amidst trade policy shifts.

3. Innovation Through Partnerships

Collaborating with suppliers on product design, sustainability, and innovation drives long-term value. Our expertise in supplier assessments helps forge strategic partnerships that keep you ahead of the curve.

4. Operational Excellence

A strong foundation of policies, technology, and talent ensures agility and compliance. We streamline your procurement processes to adapt quickly to tariff changes and market demands.

Practical Steps: From “China Plus One” to “China Plus X”

The old “China plus one” diversification model is evolving into “China plus X,” where companies spread sourcing across multiple regions—like Vietnam, Mexico, and the U.S.—to mitigate risks. Here’s how to make it work:

• Diversify Strategically: Source 5% from China, 10% from Vietnam, 40% from Mexico, and 30% from the U.S., optimizing costs and resilience.

• Leverage Technology: AI-driven tools simplify complex sourcing decisions—something we integrate into our scouting and assessment services at Sumedian.com.

• Build Agile Supply Chains: Companies like Hasbro, which shifted production to Vietnam and India, show how proactive diversification pays off.
  
  

Conclusion: Reshoring as a Strategic Opportunity

With U.S. tariff policies reshaping global trade, reshoring is no longer optional—it’s a necessity. By partnering with Sumedian.com, you gain access to expert scouting, RFQ/RFP management, and supplier assessments to navigate this landscape confidently. Our tailored procurement solutions empower you to reduce costs, manage risks, and position your business for success.

Ready to adapt your sourcing strategy? Contact Sumedian.com today to explore how we can help you thrive in the age of reshoring.