9 July 2025

Margot Konigshöfer (Photo: Procfit)

 

The political will in Europe to become more self-reliant is also rubbing off on corporate Europe: more and more European companies are bringing production back home, as rising transport costs, political uncertainty, and quality issues are forcing them to rethink their approach. Yes, European wages are high, but ultimately, it's not just the unit price that counts, but also reliability, quality, and predictability, and that’s precisely where European manufacturers excel - so argues Margot Königshofer, the founder and managing director of Germany-based supply chain experts Procfit GmbH, in an exclusive interview with MoveTheNeedle.news.

The Bigger Picture: Why Onshoring Is Gaining Ground

For decades, offshoring production to Asia was the default for many European brands. Lower wages, massive factory capacity, and a well-oiled logistics machine made Asia the go-to manufacturing hub for everything from consumer electronics to cosmetics.

But the last few years have revealed serious cracks in this system.

COVID-19 wreaked havoc on global supply chains. Freight rates for containers surged to historic highs. Political tensions—from US-China trade wars to Russia’s invasion of Ukraine—added new layers of unpredictability. And sustainability regulations, especially within the European Union, have grown sharper and more complex.

These developments triggered a broader rethinking of supply chain priorities, says Königshofer.

“This return to Europe is not just a short-term reaction to global instability,” she explains. “It’s a strategic shift for companies focused on long-term resilience, compliance, and brand value.”

In short, businesses are asking more of their suppliers: not just to produce cheaply, but to produce well—and in a way that aligns with their values and commitments to customers and regulators.

Understanding the True Cost of Manufacturing

Despite the shift in mindset, Königshofer says many companies still hold outdated assumptions about reshoring and nearshoring.

“They believe it’s always significantly more expensive,” she notes. “But that overlooks the full picture: total landed costs, working capital needs, inventory risk, and compliance complexity.”

European production offers several strategic and financial benefits:

• Reduced lead times, enabling more responsive supply chains and lower inventory requirements

• Improved product quality and fewer defects, cutting down on returns and rework

• Streamlined communication and oversight, especially across fewer time zones and language barriers

• Lower freight and insurance costs

• Regulatory alignment with EU standards, saving time and costs on testing, documentation, and certification

• Cashflow advantage: “In Europe, you pay after receiving the goods,” Königshofer explains. “In Asia, you often pay everything upfront before you’ve even seen the product.”

Critically, automation and process optimisation within European manufacturing facilities are also helping to bridge cost gaps, especially in industries where precision, compliance, or customisation matter.

Industries Leading the Reshoring Charge

Procfit sees strong onshoring momentum in a wide range of sectors, particularly those with sustainability goals or regulatory complexity. These include:

•            Sustainable fashion and textiles

•            Health and wellness products

•            Cosmetics and skincare

•            Packaging solutions

•            Furniture and home goods

“Sectors with high customisation or regulatory sensitivity tend to lead the shift,” Königshofer explains. “For EU-based and purpose-driven brands, compliance with ESG regulations, traceability, and carbon reduction targets are now core factors in supplier decisions.”

She also notes the increasing use of reshoring as a brand asset. The “Made in Europe” label is no longer just a mark of origin—it’s a statement about ethical sourcing, shorter delivery times, and quality you can trust.

“It builds customer confidence,” she says. “Especially in categories like baby products, health, and food-related items.”

From Strategy to Execution: How Procfit Helps Companies Reshore

Procfit’s role is to guide companies through every step of the reshoring process. That includes:

•            Assessing production needs and feasibility

•            Scouting and vetting manufacturing partners within Europe

•            Coordinating samples and validation

•            Supporting supplier negotiations and onboarding

•            Managing ongoing supply chain optimisation

“We act as an operational extension of our client’s team,” Königshofer says. “Fast, lean, and focused on results.”

One skincare brand, for example, reduced delivery lead times from 60 to 15 days and cut defect rates by 40% after moving production from Asia to Eastern Europe. In another case, a fashion label saved over 25% in total unit costs—not by cutting wages, but by reducing freight expenses and unnecessary inventory.

Advice to Companies on the Fence

For European businesses still hesitating to localise production, Königshofer has one key message:

“Start small and validate,” she says. “You don’t need to reshuffle your entire supply chain at once. Test with one product line or one region. Consider the total cost—not just the per-unit price. And most importantly, work with partners who understand the European supplier landscape and can help you accelerate the process while avoiding costly mistakes.”

With Europe’s industrial base evolving, and customer and compliance demands rising, reshoring is no longer a defensive move. It’s an opportunity to strengthen supply chains, reinforce brand trust, and reduce long-term risk—while bringing jobs and know-how back to the continent.

About Procfit GmbH

Founded by Margot Königshofer, Procfit is a Germany-based supply chain consultancy helping companies design and execute cost-efficient, fast, and resilient sourcing strategies within Europe. The company works with startups, DTC brands, and established manufacturers looking to scale sustainably and efficiently.