October 02, 2023

In a recent influencer article, MIT CTL Director Yossi Sheffi discusses issues involved with sourcing in China. 

In these unstable times, keeping most of your sourcing eggs in the China basket has become inadvisable, and companies appear to be putting a lot more energy and resources into finding alternatives to the world’s workshop.

In a survey of the US-China Business Council’s member companies, 28% expressed pessimism about the outlook in China, up from 21% last year. The number of optimistic companies fell to a record low of 49%. More than one-third of respondents said they have reduced or paused planned investments in China over the past year.

As I described in my 2020 post Moving Out of China? Not Really establishing relatively small-scale operations elsewhere as a hedge against over-dependency on Chinese manufacturing is commonly called the ‘China + 1’ strategy. Is this strategy no longer tenable as companies strive to withdraw most, or even all, of their operations from China?

Read the full article here