Offshoring has long been a cornerstone strategy for freight forwarders. But as 2025 continues to introduce new challenges, a critical question remains top of mind: Is offshoring dying?
While it’s tempting to think so amid all the disruptions to the global supply chain in the first half of 2025 alone, it would be a mistake to think that offshoring is on the way out.
A better way to think about is we’re entering a new phase in offshoring.
What does that mean for the supply chain management ecosystem?
Let’s dive into the specifics.
Offshoring is evolving, not dying
Faced with tariff unpredictability, geopolitical tensions, and the rise of generative AI, cracks in the traditional offshoring model are showing.
But offshoring as a strategy is far from being down and out.
The recently announced 90-day tariff deal between U.S. and China, reducing steep rates from 145% to 30%, underscores the industry’s resilience and continued relevance. Soon after the announcement of the trade truce, bookings for cargo shipping spiked.
Amid the direct threat of tariff fluctuations, offshoring is evolving—not dying—to better tackle supply chain shocks.
But make no mistake: This evolution has been ongoing well before tariffs came into the picture.
A survey by Deloitte in 2024 revealed that companies are no longer only concerned with cost-efficiency and global talent access. Many organizations are also prioritizing resilience, adaptability, and risk management when they’re making offshoring decisions.
For instance, 39% of companies reported actively exploring strategic in sourcing opportunities.
Yet, 82% of companies also reported that their third-party providers met or exceeded expectations—with 80% maintaining or increasing their investments in outsourced services.
This blended approach of continued/increased outsourcing with selective insourcing demonstrates the offshoring industry’s proactive steps to adapt to future challenges.
The offshoring industry’s preparation and response to disruptive trends
In 2025, offshoring as a strategy for effective supply chain management support is undoubtedly still relevant—despite the disruptive trends that have surfaced in recent years.
Below are the ways in which the industry is adapting and rising to the challenge.
1. Harnessing AI and automation
The adoption of digital technologies such as AI, the Internet of Things (IoT), and blockchain is reshaping supply chain operations.
When implemented right, these transformative technologies can help predict demand fluctuations, optimize routes, and reducing operational costs.
A study by PwC estimates that AI-driven supply chain improvements could increase productivity by up to 15% and reduce costs by 10% annually.
Industry observers predict that by the end of 2025, 50% of supply chain operations will be automated to complement traditional outsourcing models.
2. Flexibility amid trade uncertainty
Ongoing tariff shifts, like those introduced by the Trump administration, have added volatility to global trade. According to the Peterson Institute for International Economics, U.S. companies stand to lose $50 billion annually if tariffs stay on.
Yet the recent U.S.-China trade truce seemingly dashed that looming loss—triggering a sharp uptick in cargo ship bookings.
This goes to show how quickly businesses can pivot in response to changing conditions. In this climate, companies are embracing flexible supply chain models—balancing offshoring with nearshoring and domestic production—to adapt more swiftly and reduce exposure to trade risks out of their control.
As an added measure against trade uncertainty, businesses are exploring alternative markets and diversifying their supply chains to reduce reliance on any single country. This strategic shift not only enhances resilience but also opens up new opportunities for growth in emerging markets.
3. Nearshoring and regionalization
To mitigate risks and reduce costs, companies are increasingly adopting nearshoring and regionalization strategies. Nearshoring involves relocating operations closer to home, while regionalization optimizes within a specific geographic area.
For instance, Kuehne+Nagel, a global logistics provider, has established a new facility at the Texas-Mexico border, underscoring the trend towards nearshore solutions. Reports by The Reshoring Initiative indicate that nearshoring can cut logistics costs by up to 25% and lead times by 50%.
Furthermore, nearshoring offers companies the opportunity to forge closer relationships with their suppliers, ensuring greater control and oversight over production processes.
4. Sustainability in mind
There is a growing emphasis on sustainability and ethical practices influencing outsourcing decisions. For years, companies have been shifting to environmentally friendly and socially responsible partners. And in 2025, that effort is further intensifying.
A survey by McKinsey found that 70% of consumers are willing to pay a premium for products derived from sustainable supply chains. This trend is pushing companies to adopt greener practices, such as reducing carbon footprints and ensuring fair labor conditions, which are becoming vital in partner selection and overall supply chain strategy.
5. Building resilient supply chains post-pandemic
The COVID-19 pandemic has had a profound impact on global supply chains, exposing vulnerabilities and emphasizing the need for agility and resilience.
For years now, companies have been building more robust supply chains that can withstand future disruptions. This includes diversifying supplier bases, increasing inventory levels, and implementing advanced analytics for better forecasting and decision-making.
The pandemic has also sped up the adoption of remote work and the disruptive technologies mentioned above, to avoid unforeseen downtimes.
Offshoring in 2025 and beyond is value-driven
More than simply about cost efficiency, today’s offshoring is about more bang for buck. That means looking for outsourcing partners who have a proven track record for quality talent, outcomes-based service, and adaptability amid challenging times.
The Offshore Hive has what you need to remain competitive and thrive in today’s offshoring landscape.
Specializing in the freight forwarding industry, we provide scalable logistics outsourcing solutions that can weather any challenge that comes your way.
If you’re looking for an end-to-end freight management BPO, we are up to the task.
Send us a message to tell us more about your offshore staffing needs.