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Why Companies Are Bringing Back Manufacturing

Updated: May 7, 2019

May 4, 2018 - According to a McKinsey survey, which polled over 800 companies with over $1B in sales, 54% of corporate executives responded that they planned to re-shore manufacturing to the US. This trend is not just about being closer to end-markets, it also is about inventory control.

Keith Rosenbloom of Cruiser Capital spoke with MOI Global, stating:

  • "For the first time in recent memory, management teams are including working capital and working capital maximization in their definition of free cash flow. We always have done it at Cruiser, but now, on calls, very explicitly, you see companies talking about maximization of working capital.

  • You see CFOs and CEOs bonused on working capital maximization. This is something you hadn't see before. But it's a tell tale sign.

  • And if you think about that, if you're a retailer for example, you have to control your inventory. What are you going to do? You are going to push back on your supplier. Let them hold the inventory or let them be just in time in terms of their manufacturing or delivery processes.

  • All of those factors support this theory that you're seeing increased productivity and efficiency in US manufacturing."



All information provided herein is for informational purposes only and should not be deemed as a recommendation to buy or sell securities. Cruiser Capital and its affiliated parties may hold a position in the securities mentioned at the time of posting, and may trade in and out of these positions in the future without further notice. All performance results are estimates and should not be regarded as final. Past performance is not necessarily indicative of future results. All investments involve risk including the loss of principal. This article may not be redistributed without the express written consent of Cruiser Capital Advisors LLC and does not constitute an offer to sell or the solicitation of an offer to purchase any security or investment product.


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