Case Study: How Should We Diversify Our Supply Chain?

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Anuj Shrestha

In the wake of Covid-19’s disruptions, Kshore, a Chinese appliance maker, is thinking of realigning its supply chain. Like many other global manufacturers, it’s being pressured by its customers, which include Walmart and other large retailers, to reduce the time, expense, and environmental impact of shipping goods between countries.

On a trip to Monterrey, Mexico, Kshore’s CEO and COO tour factories that are closer to North American markets—and are impressed by their professionalism. But questions about transportation and staffing give the executives pause. Should Kshore start production in Mexico or consider other countries? Two experts weigh in.

On the sidewalk outside the airport in Mexico City, Yun Liu and Keith Smith, the CEO and COO of Kshore, a Chinese appliance maker with $150 million in annual revenues, waited for their town car. Their journey from Guangzhou, China, had been a long one.

A version of this article appeared in the November–December 2023 issue of Harvard Business Review.

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Kshore, a Chinese appliance maker, is considering realigning its supply chain post-Covid-19 disruptions to meet customer demands for reduced shipping time, cost, and environmental impact. During a visit to Monterrey, Mexico, Kshore's executives explore the idea of moving production closer to North American markets. However, concerns about transportation and staffing arise, prompting a debate on whether to start production in Mexico or explore other countries. The CEO and COO of Kshore, Yun Liu and Keith Smith, contemplate the potential shift in operations during their visit to Mexico City. This article was featured in the November-December 2023 edition of Harvard Business Review.