The consumer landscape is continuing to change while B2B businesses are adjusting for the new normal. Industrial companies and manufacturers across the globe are working hard to strengthen and maintain their supply chains. Further, companies who prefer to source overseas to save on costs, are finding other cost-efficient solutions.
The reality circling B2B companies like China plastic CNC machining organizations is that purchasing professionals prefer to source locally.
Stats About Local Sourcing By B2B Companies
As per surveys conducted by Thomasnet.com,
- 83% of manufacturers are planning to add North American suppliers to their supply chains within a year, a significant increase from 54% in March 2020
- 72 percent of industrial/B2B buyers “always or generally” prefer to source locally
- In comparison, just 10.8 percent of respondents “always or generally” prefer to source globally
- Nearly half of buyers (46.7 percent) actually “rarely or never” prefer to source globally at all
Benefits of Using Local Suppliers
Most B2B buyers prefer to get the supply chain as close as possible. Here is why:
1. More Flexibility
As a supplier, you never know when a flood of opportunities will strike or a challenge would emerge. Buyers like to know about the growth pattern for the product they are procuring before they choose a supplier. Needless to say, the ability to scale is key.
For example, you can get a lucrative bid from a high ticket customer, or an existing customer might need you to scale to meet demand. Would you be ready?
By local sourcing, the answer would probably be yes because local suppliers are usually more reactive compared to suppliers residing far away. They can ship products quickly and it is quite easier for a supplier to communicate for a shipment across the neighborhood than around the globe.
2. Greater Control
The farther you are from your supply chain elements, the lesser control you have over them. Suppliers might say that they treat each of their purchase orders and customers the same. However, if they forecast a drop-in meeting or a site visit from you, chances are you will be on top of their minds.
In-person visits will enable you to address any concerns and make sure all products satisfy your standards. There is less chance too of things getting “lost in translation,” which often happens when working with big teams; many of whom are not on the floor and touching your ordered products.
Today, many manufacturers upload videos of their factories to connect with customers when travel is restricted or difficult.
3. Minimized Supply Chain Costs
If you are tight on budget, you need to consider tightening your supply chain too. The logistics budget companies spent every year is staggering, with North American organizations shelling out more than $1 billion each year.
Businesses in North America receive and send parts and products all over the continent. So, the expenses can quickly add up. Even then, the pieces need to be stored in warehouses until they are delivered again to the next supplier or, the customer if you’re lucky.
B2B companies can reduce many of these costs by localizing their supply chain. With less money being spent on logistics, there will be a sizeable increase in their bottom line.
4. Increased Revenue
Local sourcing can not only help you save money, but it can also help you make more. Because your efforts to maintain a tight and fast-paced supply chain may impress local businesses, which can help you attract new customers.
Make your commitment to local sourcing a part of your marketing and sales strategy. Consider incorporating it into your unique selling proposition.
5. Good For The Community
It makes sense that if local sourcing helps increase the bottom line, it would do the same for other manufacturers and suppliers in the same vicinity. And this can be a major boost for the local economy and the local people.
Well-paid and happy employees are likely to invest in local businesses. Moreover, well-off and respectful businesses are in a position for contributing to communities via volunteering, benefits, fundraising, and sponsored activities.
6. It Helps The Environment
Localizing the supply chain reflects a massive opportunity to help the environment. When storage and shipping are reduced, you also contribute to minimizing energy usage and emissions.
Local sourcing not only aids green manufacturing but also helps build consumer confidence. When customers buy with confidence, the business gets benefitted from increasing customer loyalty and positive brand awareness.
Today, consumers have been driving the food and beverage industry by buying products that have “clean labels” and determining their products’ origin. Food and beverage organizations that are producing products sustainably must be using marketing to showcase those efforts and offer an online direct-to-consumer experience.
7. Ability To Launch Products Faster
Manufacturers who source locally benefit from working with companies in the same time zone, which leads to easier and speedy communication. You can resolve problems faster and launch products to meet consumer demands and spikes.
As a B2B company, you have to strengthen your ties with local suppliers. Industrial sourcing activities will continue to surge. Consumer demand is expected to reach new highs for businesses such as rapid injection molding to up their transparency around corporate social responsibility and ethical supply chain. So, now is the time for industrial B2B manufacturers to closely see their 3rd-party supply chain and vendor risks. You can find suppliers near you to strengthen your business supply chain or list your business for free on online marketplaces and get found by buyers online