Dr. Gawon Yun presented “Does Location Really Matter? Reshoring in the Context of Medical Device and Pharmaceutical Manufacturing” in the Marketing Department Research Workshop VI.
Does Location Really Matter? Reshoring in the Context of Medical Device and Pharmaceutical Manufacturing
Abstract: Firms have increasingly offshored manufacturing to foreign countries in the past decades due to the expected benefits driven by low manufacturing costs. Medical device and pharmaceutical companies are not an exception by extensively shifting their manufacturing and related activities in recent years to countries such as China and India due to rising research and development (R&D) cost in their home countries. However, current supply chain issues involve appropriately responding to volatile demand, for example, during the COVID-19 pandemic that requires providing medical supplies, testing kits, etc. in a timely manner. As Grackin (2008) argues, using cost-based sourcing decisions exclusively are not appropriate for manufacturing these products because these industry sectors are hugely impacted by product quality and changing regulations in location decisions. Thus, seeing reshoring as fundamentally a location decision, this study investigate the factors contributing to various location advantages based on the sub-paradigms of ownership, location, and internationalization theory.