What is Nearshoring?

For a small Shopify store, nearshoring usually means shorter shipping times and less uncertainty about when stock will arrive. A supplier in a neighboring country can often turn around a reorder in weeks instead of months, which makes it easier to react to sales trends without tying up cash in large advance orders.

The tradeoff is usually cost. Nearshore suppliers often charge more per unit than overseas factories, but you save on freight, customs delays, and the extra safety stock you would otherwise need to cover long lead times. Owners weigh this against their cash flow and how unpredictable their overseas supplier's shipping has been.

Example

A candle brand in the US used an overseas glass jar supplier with a 90 day lead time and had to order 6,000 jars at once to avoid stockouts. They switched to a nearshore supplier in Mexico with a 15 day lead time and now order 1,000 jars at a time, reordering every few weeks as stock runs down.

Common mistakes

• Assuming nearshoring is always cheaper once freight and customs are included, without actually comparing total landed cost.
• Switching suppliers without testing quality and consistency first, then getting stuck with returns.
• Ignoring that nearshore suppliers can still have their own capacity limits or minimum order quantities.

Nearshoring and SteadyShelf

SteadyShelf uses each supplier's lead time, whether nearshore or overseas, to calculate the order-by date and suggested quantity for every SKU.

SteadyShelf is launching on the Shopify App Store. Join early access to get the install link first.

Related terms

Lead time · Supplier lead time variability · Dual sourcing · Single sourcing · Freight forwarder

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