Electronics Manufacturing

Don Nelson
First, you need a plan, one that has input and buy-in from all the relevant stakeholders, including engineers, supply chain managers, and execs. Then, if the feasibility studies and risk assessments yield a green light, you can start slowly.

For most companies, it makes sense to take a phased approach. Like a hybrid model, where you start by reshoring IP-sensitive or high-value production first and then expand the products you make domestically as your production capabilities increase.

Similarly, depending on why you’re choosing to reshore, you may not need to come all the way back to the U.S. You can solve a lot of shipping and weather problems by nearshoring to a place like Mexico. Of course, even with nearshoring, you still have the issue of tariffs.

If you bring production back to the U.S., then I recommend investing in cutting-edge automation. That will help reduce labor costs, and can also improve quality and efficiency over what you had before. Reshoring manufacturing gives you a clean slate; I’d make the most of it by setting up state-of-the-art systems.

And finally—and this is actually something I’d do at the planning stage—make sure you investigate grants, tax breaks, and other government incentives for bringing your manufacturing back onshore. Federal, state, and even local governments sometimes offer these economic incentives, and the terms usually aren’t onerous, which makes these incentives a good deal. Never leave money sitting on the table.

EMN
When does it make sense to use a contract manufacturer as a way to reshore? How do you determine when to do it yourself and when to rely on a third party?

Don
There are certain situations where a lot of risk can be avoided by using a contract manufacturer. Companies that have variable production volumes, for example, can get a lot of benefit from this kind of partnership, because contract manufacturers are equipped to efficiently manage fluctuations in demand—whether it’s ramping up a new product or scaling down during a slow period.

Contract manufacturers also bring deep expertise in regulatory compliance, and can help their partners navigate local and international standards like UL, FCC, or RoHS. This expertise is crucial for avoiding legal pitfalls and ensuring a smooth market entry.

Another advantage companies get in this type of partnership is the ability to leverage their contract manufacturer’s infrastructure and supply chain relationships, which can significantly speed up the time to market for new products. This is especially valuable in the fast-paced electronics sector, where being first to market can be a major competitive advantage and a real incentive for reshoring manufacturing in the first place.

EMN
What strategies would you recommend for companies to ensure a smooth and cost-effective transition when reshoring manufacturing operations back to the U.S.?

Don
Reshoring manufacturing back to the U.S. requires a multi-faceted strategy that addresses logistics, weather, labor, warehouse operations, and robust management systems.

Start with thorough logistics planning. Given tariff policy shifts and changing trade routes—including potential disruptions around key passageways like the Panama Canal—evaluate alternate distribution methods and secure partnerships with logistics specialists who understand U.S. regulations and geography. Integrate advanced logistics management (LM) systems and IoT-enabled platforms to optimize supply chain routes, predict delays, and maintain real-time visibility into goods movement.

Weather remains a critical factor: U.S. regions face diverse climates, and manufacturing hubs in the Southeast or Midwest may encounter hurricanes, storms, or winter delays. Use predictive analytics within LM systems to build contingency plans around severe weather, including dynamic rerouting and warehouse stock adjustments.

Also, be sure to assess labor market conditions by focusing on strategic recruitment, workforce training in automation, and upskilling existing employees to collaborate with robotics and AI-driven equipment. Persistent labor shortages demand creative workforce solutions, like investing in competitive compensation packages and automation to offset gaps.

Warehouses should be re-evaluated for scalability, flexibility, and sustainability. Implementation of advanced warehouse management systems (WMS) supports inventory controls, lean operations, and rapid order fulfillment. Consider green building standards and energy-efficient upgrades to minimize overhead costs in new facilities; this also helps companies future-proof against energy price shocks and respond to demands for sustainable operations.

Finally, integrate a comprehensive quality management system (QMS) to drive consistency and compliance from day one. A well-documented QMS ensures process control, traceability, real-time quality monitoring, and rapid problem resolution—all of which are crucial during the turbulence of relocation and startup. By combining tech-enabled management systems, strategic workforce planning, climate-aware logistics, and agile warehousing, companies can significantly mitigate risks, streamline costs, and position themselves for sustainable growth in the reshored U.S. manufacturing landscape.

EMN
How important is having a trained workforce for successfully reshoring manufacturing, and what steps should companies take to build and retain a skilled workforce?

Don
A trained workforce is absolutely critical to the success of reshoring in electronics manufacturing. While bringing production back to domestic soil involves investments in facilities and technology, the human element remains the backbone of sustainable operations. A skilled workforce not only ensures smooth production processes but also drives the innovation and operational efficiency that’s essential for competitiveness.

To build and retain this workforce, companies should start with comprehensive training programs. Deploying structured training, including continuous improvement methodologies like Six Sigma and Kaizen, sharpens process quality and problem-solving skills. And partnerships with trade schools, community colleges, and technical institutions can foster talent pipelines and keep operations resilient. These collaborations also help fast-track apprenticeships and certifications tailored to modern manufacturing technologies. Finally, as a leader of a social enterprise with a mission to provide jobs for people with disabilities, I also recommend that companies look beyond their traditional hiring pools to include overlooked groups like people with disabilities and military veterans.