Nearshoring in Poland. A growing trend in the fastener industry

In recent years, nearshoring has gained traction in Poland, particularly in the fastener industry. As globalization often brings to mind the relocation of production to distant, low-cost regions, the COVID-19 pandemic has shifted this perspective.

Companies have realized that proximity can offer significant advantages. Disrupted supply chains, lockdowns, and logistical challenges have prompted manufacturers, including those in the fastener sector, to explore nearshoring – the practice of moving production to geographically and culturally closer countries.

But does nearshoring present new opportunities for fastener manufacturers? Could it herald a new era for the manufacturing industry? In this article, we’ll explore these questions and delve into the benefits of adopting nearshoring strategies in the fastener production sector.

What is Nearshoring?

Nearshoring involves relocating business operations or processes to organizations in geographically closer countries. For example, Western European companies might move production to Central and Eastern Europe instead of outsourcing to Asia or North America.

The primary goal of nearshoring is to harness the benefits of outsourcing, such as reduced labor costs and access to specialized resources, while mitigating challenges like time zone differences, cultural barriers, and extended supply chains.

Partnering with a company in a similar time zone can streamline communication and coordination. Additionally, geographical proximity facilitates face-to-face meetings when necessary. Depending on the industry, nearshoring can encompass various processes, from software development and customer service to industrial production.

Nearshoring vs. Global Outsourcing: What’s the Difference?

While both nearshoring and outsourcing aim to optimize operations and enhance efficiency, they differ significantly in their approach. Global outsourcing involves transferring business functions or processes to external organizations, regardless of their location. Companies might outsource services or production to a country on the other side of the world if it offers financial or operational benefits.

In contrast, nearshoring focuses on relocating processes to geographically closer countries, often within the same continent. This strategy aims to retain the benefits of outsourcing while minimizing challenges like time differences, language and cultural barriers, and management difficulties.

Each strategy has its pros and cons. Outsourcing can leverage low labor costs in developing countries but may face challenges in management, quality control, and supply chain reliability. Nearshoring, on the other hand, offers better communication and coordination due to proximity, often at competitive costs when considering not only purchase costs but also risk reduction measures such as larger safety stocks and insurance.

Choosing between these strategies depends on a company’s specific needs and priorities.

Nearshoring in Poland: A Growing Reality

The trend of nearshoring is gaining momentum globally, with Poland emerging as a key player. According to a recent report by Reuters Events and A.P. Moller-Maersk, titled “Generational Change in Supply Strategy: Global and European Deep Dive into Near-sourcing, Nearshoring, and Reshoring in the Post-Pandemic World,” there’s a significant shift in supply strategies. The report, based on a survey of global retailers and manufacturers, highlights that 67% of respondents were compelled to seek new supply sources due to pandemic-induced disruptions.

Moreover, 58% of companies that have already made such changes continue to prioritize relocation. This indicates a lasting shift in business strategy rather than a temporary response to pandemic challenges.

Poland, with its strategic location, skilled workforce, attractive labor costs, and developed infrastructure, is becoming the most sought-after nearshoring destination in Europe. European companies are increasingly turning to Poland to shorten their supply chains, reduce risk, and maintain high service standards.

Industries Benefiting from Nearshoring

According to the report “Poland in Global Supply Chains During the Pandemic and War,” edited by Leszek Kąsek, nearshoring is particularly advantageous for sectors like high-tech automotive, machinery production, and logistics. However, it’s less beneficial for light industries (clothing, footwear) and energy-intensive industries due to the cost advantages of Asia and Europe’s expensive energy.

For Polish companies, this presents an opportunity to climb the global value chain.

Nearshoring: A Boon for Fastener Manufacturers

Nearshoring presents a promising opportunity for companies in the fastener industry. At Marcopol, we’ve observed a growing interest in our products and services from companies that previously relied on suppliers in Asia.

We specialize in delivering high-quality standard fasteners, crucial for industries ranging from machinery to aviation and automotive. The increasing demand for locally manufactured products reflects a broader trend toward relocating operations to geographically closer regions like Poland. Benefits include shorter supply chains, reduced risk of delays, and the ability to closely monitor and supervise the production process.

At Marcopol, we’re well-equipped to meet this rising demand. Our advanced machinery, experienced specialists, and robust logistics network enable us to deliver both standard and custom fasteners on time and according to customer specifications. We aim to offer comprehensive solutions tailored to our partners’ needs, ensuring not just a product but a full-service experience.