Manufacturing Reshoring: How Digital Twins Are Revolutionizing The Return Of Production

In the volatile global manufacturing landscape of 2025, businesses face mounting pressure to optimize supply chains, reduce operational costs, and mitigate risks from international disruptions. As a result, manufacturing reshoring and nearshoring have emerged as strategic priorities for companies looking to secure their production capabilities closer to home markets.

Recent years have seen manufacturing firms increasingly reconsidering their global supply chain strategies due to:

• Persistent supply chain disruptions

• Rising international tariffs

• Increasing shipping and transportation costs

• Growing political instability

• Pandemic-related vulnerabilities

According to a 2021 Reshoring Initiative survey, nearly 60% of U.S. manufacturers reported plans to either nearshore or reshore portions of their operations. This trend accelerated following trade tensions between the U.S. and China that began escalating in 2018, with companies like Apple, General Electric, and Caterpillar shifting production to Mexico and neighboring regions to avoid tariffs and minimize shipping expenses.

Understanding the reshoring cost-benefit analysis for manufacturers

Manufacturing executives face complex decisions when evaluating whether to reshore production operations. The process requires cost-benefit analysis that goes beyond simple labor cost comparisons. Companies must weigh the investment against long-term strategic advantages to determine if reshoring aligns with their business objectives and competitive positioning.

This section will cover cost considerations as well as the advantages of reshoring manufacturing operations..

Reshoring costs to consider

When evaluating a potential reshoring initiative, manufacturers must account for several significant expenses that impact the overall business case. These upfront and ongoing costs can determine whether reshoring delivers positive ROI and is worth pursuing. 

1. Substantial initial investment

   • New facilities and infrastructure

   • Modern machinery and technology acquisition

   • Local workforce hiring and training programs

2. Higher labor expenses and productivity tradeoffs

   • Increased wage requirements in developed economies

   • Potential productivity gaps during transition periods

3. Supply chain restructuring

   • Establishing new supplier relationships

   • Rebuilding logistics networks

   • Ensuring production continuity during transition

4. Regulatory compliance challenges based on locale

   • Adapting to local labor regulations

   • Meeting environmental standards

   • Adhering to safety requirements

Reshoring benefits and advantages

Despite considerable costs, manufacturing reshoring offers compelling long-term advantages that outweigh the initial investment for many companies. These strategic benefits can provide long-term competitive advantages depending on the industry.

1. Sustainability improvements

   • Lower carbon emissions from transportation

   • Alignment with growing consumer sustainability sentiment

   • Positive brand perception

2. Significant shipping cost reduction

   • Lower transportation expenses

   • Reduced inventory carrying costs

   • Decreased carbon footprint

3. Better quality control

   • Closer oversight of production processes

   • Increased product inspection opportunities

   • Consistent adherence to quality standards

4. Accelerated time-to-market

   • Shortened delivery timeframes

   • Enhanced responsiveness to market demands

   • Faster product introduction capabilities

How digital twin technology enables successful manufacturing reshoring

For manufacturers navigating the reshoring process, digital twin technology has emerged as an essential tool that supports planning and implementation. These photorealistic virtual replicas of physical manufacturing environments provide a comprehensive simulation platform that reduces risk and optimizes outcomes.

Virtual facility design and workflow optimization

Digital twins offer manufacturers unprecedented visibility into facility planning and workflow design. By creating detailed virtual models, companies can test various production layouts, identify potential bottlenecks, and plan optimize space utilization before making physical changes. This capability proves invaluable when designing new domestic facilities or reconfiguring existing spaces to accommodate reshored operations.

Precise facility modification planning

The technology excels at facility modification planning by enabling precise digital representations of both current and future manufacturing environments. Teams can experiment with equipment placement, workflow arrangements, and space allocation virtually, eliminating costly trial-and-error approaches. When a company needs to retrofit an existing facility or build an entirely new one, digital twins provide the foundation for efficient design decisions based on accurate spatial data and measurements.

Comprehensive supply chain visualization

Supply chain visualization represents another powerful application of digital twin technology in reshoring initiatives. Manufacturers can model how facility relocation affects material flow, assess new logistics requirements, and understand the impact of changes in supplier interactions. This holistic view helps companies anticipate disruptions and develop mitigation strategies before they impact production.

Proactive risk assessment and mitigation

Risk assessment capabilities make digital twins particularly valuable during the transition period. By modeling potential disruption scenarios—from equipment failures to workforce shortages—manufacturers can develop robust contingency plans and build training protocols. This proactive approach can significantly reduce operational risks associated with reshoring production.

Data-driven reshoring decision support

Perhaps most importantly, digital twins enable more accurate cost-benefit analysis for reshoring decisions. By creating detailed simulations of both current and future states, companies can generate precise estimates of relocation expenses, ongoing operational costs, and potential efficiency gains. This data-driven approach leads to better-informed reshoring decisions based on comprehensive financial modeling rather than assumptions.

Tactical applications of Matterport's digital twin platform for manufacturing reshoring

Among the leading solutions in this space, Matterport's digital twin technology enables organizations to visualize and plan manufacturing facilities in immersive 3D environments.

For reshoring manufacturers, Matterport's platform supports the following processes:

1. Facility space planning and optimization

Matterport's detailed 3D models provide precise spatial measurements, helping manufacturers determine optimal floor area utilization. By simulating equipment installation, layout changes, and workflow modifications in a virtual environment, companies can optimize facility performance before implementing physical changes.

2. Remote facility assessment with virtual tours

Digital twins enable virtual tours of existing or prospective manufacturing facilities that can be contextualized using Notes and Tags within the twin itself. This is invaluable for assessing location suitability without extensive travel. Remote teams, decision-makers, and stakeholders can collectively evaluate spaces and streamline the facility selection process.

3. Improves cross-functional collaboration and communication

Matterport facilitates seamless, real-time collaboration between geographically dispersed teams. Stakeholders from engineering, operations, and management can access and provide input directly in the digital twin. This reduces the need for coordinating in-person logistics and facilitates quicker consensus with documentation that can be referenced at any stage in the process. 

4. Accelerated implementation timelines

As manufacturers adapt to changing market conditions, Matterport's ability to quickly create accurate 3D models expedites decision-making processes. Companies can evaluate potential sites, validate production layouts, and initiate transitions more efficiently than with traditional planning methods.

The future of manufacturing: Reshoring supported by digital innovation

While reshoring manufacturing operations presents significant challenges, digital twin technology—particularly platforms like Matterport—provides manufacturers with powerful tools to navigate this complex transition. By creating virtual facility models, simulating supply chain scenarios, and optimizing production layouts, manufacturers can make informed decisions that lead to:

• More efficient operations

• Substantial cost savings

• Effective risk mitigation

• Enhanced adaptability to economic changes

As global manufacturing continues evolving, the combination of reshoring strategies and digital twin technologies positions forward-thinking manufacturers to build more resilient, responsive, and competitive operations for the future.