Key Takeaways
- 84% of UK manufacturers plan to nearshore or localise at least half of their supply chain, according to Dun & Bradstreet’s 2025 survey of 10,000 executives — but only 8% have made it a near-term priority.
- The total landed cost equation has shifted: factory unit cost is no longer the deciding factor when tariffs, freight volatility, and inventory carrying costs are factored in.
- Road freight from Eastern Europe reaches the UK in 2-5 days versus 30-45 days for ocean freight from Asia — a difference that directly reduces working capital tied up in transit.
- Nearshoring is not all-or-nothing. The most resilient UK importers are running hybrid models: some Asian production for cost-sensitive volume lines, European production for speed-sensitive or high-variety lines.
- Customs declarations remain required for EU-UK shipments post-Brexit, but regulatory alignment on product standards and shorter supply chains reduce compliance complexity compared to long-distance sourcing.
The Numbers Behind the Shift
The nearshoring conversation has moved from boardroom speculation to hard data. Dun & Bradstreet’s global survey of 10,000 executives, published in November 2025, found that 84% of UK manufacturers plan to nearshore or localise at least half of their supply chain. A follow-up survey in January 2026 put the global figure at 61% — still a majority, but with a telling caveat: only 8% of manufacturers said nearshoring was a priority in the next 12 months.
That gap between intention and action is where the real story lives. Most UK importers know they should diversify away from single-country dependency. Few have a practical plan to do it.
The forces pushing nearshoring are not theoretical. Section 301 tariffs on Chinese goods remain in place through 2026, with rates as high as 100% on specific product categories. Ocean freight rates on the Asia-Europe route have swung by 300-400% within single quarters during recent years. Port congestion at Felixstowe and Southampton has become a recurring feature rather than an anomaly. And the UK’s de minimis threshold — the £135 limit below which imported goods escape customs duty — is now scheduled for removal in October 2028 (we covered the accelerated timeline here), which will reshape the economics of low-value direct-from-Asia e-commerce.
When you add it up, the case for keeping all your production 6,000 miles away looks weaker than it did five years ago.
Why the Old Model Is Under Pressure
Three structural changes have altered the offshoring calculus for UK importers.
Tariff volatility is the new normal. The UK’s post-Brexit trade policy has been more stable than the US approach, but the knock-on effects of American tariff actions ripple through global supply chains. When the US imposes new duties on Chinese goods, Chinese manufacturers look for alternative markets — and UK importers can find themselves competing for capacity or facing redirected supply. The UK Trade Remedies Authority has also become more active, with steel quotas and anti-dumping measures creating new cost variables for specific commodity imports — our guide to the UK steel trade measures from July 2026 covers the latest quota changes.
Supply chain disruption is no longer exceptional. Between the Red Sea crisis, which forced vessels onto the Cape of Good Hope route and added 10-14 days to Asia-Europe transit times, and recurring port congestion at major UK gateways, the assumption of reliable 30-day lead times from China has broken down. Every additional day of transit is a day of working capital tied up in inventory that cannot be sold.
Customer expectations have reset. Two-day delivery is now the floor for B2B as well as B2C. If your factory is three to five weeks away by sea, you are forced to hold more safety stock — which means more warehouse space, more insurance, and more cash locked in boxes on shelves. Nearshoring lets you carry less inventory and reorder faster, which matters particularly for products with unpredictable demand patterns, short shelf lives, or frequent design changes.
The Total Landed Cost Equation
The most common mistake UK importers make when evaluating nearshoring is comparing factory gate prices. A unit that costs £8.50 from a Chinese supplier versus £11.20 from a Polish one looks like a straightforward decision — until you run the full landed cost.
Landed cost includes factory unit price, plus international freight, insurance, customs duty, port handling, inland transport, and — critically — the cost of carrying inventory. A container from Shanghai to Felixstowe might cost £2,500-£4,000 in ocean freight depending on the spot market, take 30-45 days door-to-door, and require three to four weeks of safety stock to cover variability. A truck from Wrocław to a UK distribution centre takes three days and costs a fraction of that in working capital terms.
The maths shifts further when you factor in customs duty. Goods imported from the EU under the UK-EU Trade and Cooperation Agreement can qualify for zero tariffs if they meet rules of origin requirements — see our rules of origin explainer for the detail on how preferential origin is determined. Goods from China attract the UK Global Tariff, which applies Most Favoured Nation rates — typically 2-12% depending on the commodity code, but higher for sensitive categories like textiles, ceramics, and steel products.
For a worked example — start with our landed cost calculation guide for the full methodology — a UK importer bringing in 10,000 units per month of a consumer good with a factory price of £10 from China might pay £1.20 per unit in duty (12% on certain textile categories), £0.40 in ocean freight, £0.15 in insurance and port charges, and carry £50,000 in extra inventory to cover the six-week pipeline. The same product manufactured in Poland at £12.50 per unit, with zero duty under the TCA, £0.25 in road freight, and two weeks less inventory, can come out cheaper on a total-cost basis — even though the invoice price is 25% higher.
This is not universal. High-volume, low-complexity products with thin margins and predictable demand still favour Asian production. The point is that the decision requires a full cost model, not a glance at the supplier quote.
Where UK Importers Are Nearshoring
The nearshoring map for UK importers has several distinct regions, each with different strengths.
Central and Eastern Europe remains the primary destination. Poland, Czech Republic, Hungary, and Romania offer competitive manufacturing wages — approximately £1,700-£1,800 per month in early 2026 — combined with strong technical education systems and established industrial bases. These countries have spent two decades integrating into German and Western European supply chains, which means their factories understand the quality, documentation, and traceability standards that UK importers require. Road freight from the region reaches the UK in two to five days via Channel crossings.
Turkey has emerged as a significant nearshoring option, particularly for textiles, apparel, and light manufacturing. The UK-Turkey trade agreement, rolled over from the EU-Turkey customs union arrangements, provides preferential tariff treatment for industrial goods. Transit times by road are typically five to seven days. Turkish manufacturers have deep experience serving European fashion and home goods brands, and labour costs remain competitive with Eastern Europe.
Portugal offers a Western European option with GMT time zone alignment, EU single market access, and strong capabilities in textiles, footwear, and precision engineering. Labour costs are higher than Eastern Europe but lower than the UK. The main constraint is capacity — Portugal’s manufacturing sector is smaller than Poland’s or Turkey’s, and lead times for new supplier relationships can be longer.
North Africa — particularly Morocco and Tunisia — is an emerging option for UK importers, though less developed than the European alternatives. Morocco has a free trade agreement with the UK and growing automotive and aerospace supply chains. Transit times to the UK are typically seven to ten days including the Strait of Gibraltar crossing. The region is best suited to importers with existing Mediterranean logistics relationships.
The trend among sophisticated importers is not to pick one region but to run a multishoring model: China for cost-sensitive volume lines, Eastern Europe for speed-sensitive or high-variety lines, and perhaps Turkey or Portugal for specific category expertise. This spreads geopolitical risk, reduces single-supplier dependency, and creates optionality when one region faces disruption.
The Logistics Reality Check
Moving production closer to home changes the logistics profile significantly — but it does not eliminate complexity.
Customs declarations do not disappear. Post-Brexit, all commercial goods moving from the EU to the UK require a customs declaration, regardless of whether duty is payable. This means a Polish supplier still requires the same CDS entry as a Chinese one. The difference is that EU-origin goods qualifying for zero tariff under the TCA use a simpler declaration process, and the shorter supply chain means fewer intermediaries and less chance of documentation errors compounding across multiple handoffs.
Freight modes shift from ocean to road. The dominant mode for European nearshoring is groupage road freight — shared truck space, consolidated at cross-dock facilities near the Channel. This is faster than ocean but requires different planning. Lead times are measured in days, not weeks, which means production scheduling and transport booking need to be more tightly integrated. The CMR consignment note replaces the bill of lading as the key transport document.
Inventory models need rethinking. The whole point of nearshoring is to reduce inventory. But that only works if your forecasting and replenishment processes can operate on shorter cycles. A UK importer used to placing orders six weeks ahead and forgetting about them until the container arrives needs different systems — and different supplier relationships — to run a three-day replenishment model. This is where the 84% who plan to nearshore but only 8% who are actively doing it reveals the implementation gap.
Warehouse networks may need to change. If you currently receive all goods at a single UK distribution centre near Felixstowe or Southampton, nearshoring to Eastern Europe might shift your inbound flow toward Dover or the Channel Tunnel. For importers running multiple regions simultaneously, the warehouse needs to handle both container receipts and groupage truck deliveries — different unloading processes, different documentation, different booking systems.
Risks the 84% Are Underestimating
Nearshoring is not a risk-free strategy. Several pitfalls catch out first-time adopters.
Energy cost exposure in Central and Eastern Europe. ING’s April 2026 analysis of the CEE manufacturing sector flagged energy reliability as a growing concern. The region’s industrial base is energy-intensive, and the 2026 energy price shock has hit manufacturers in Poland and Czech Republic harder than Western European counterparts. When evaluating a CEE supplier, energy cost pass-through clauses in contracts matter as much as the base unit price.
Capacity constraints in the most popular destinations. Polish and Czech manufacturing capacity is not infinite. German companies have been nearshoring to the same region for years, and the best factories are already at high utilisation. UK importers entering the market now may find themselves competing for capacity with established German clients who place larger orders. The second-tier supplier market in Romania, Bulgaria, and Serbia is less crowded but requires more due diligence.
Supplier concentration risk. Moving from one Chinese supplier to one Polish supplier does not solve the single-point-of-failure problem — it just moves it closer. The resilience benefit of nearshoring comes from having multiple production options across regions, not from swapping one dependency for another.
The transition itself is a risk. Switching production from an established Asian supplier to a new European one typically takes six to twelve months. During that period, you are running two supply chains: the old one winding down and the new one ramping up. Quality issues, delayed first articles, and production teething problems are common. Importers who underestimate the transition timeline end up with stock gaps.
Customs rules of origin are not automatic. Zero-tariff treatment under the UK-EU TCA requires the goods to meet rules of origin — meaning sufficient processing has occurred within the EU or UK. If your Polish supplier is assembling components sourced from China, the finished product may not qualify for preferential origin and could attract the full UK Global Tariff. This is a common trap for importers who assume “made in the EU” means “duty-free.”
How to Build a Nearshoring Strategy
For UK importers serious about nearshoring, a structured approach beats a reactive one.
Start with the product portfolio, not the map. Segment your SKUs by margin, demand variability, lead-time sensitivity, and product complexity. High-margin, high-variability products with short shelf lives are the strongest nearshoring candidates. Low-margin, stable-demand commodity items may stay offshore. The segmentation tells you what to move, not where to move it.
Run the full landed cost model. Build a spreadsheet that includes factory price, freight, insurance, duty, port charges, inland transport, inventory carrying cost, and an estimate of stockout risk. Run it for each sourcing scenario. The result will surprise you — some products that look cheaper from Asia are not, and some that look more expensive from Europe are cheaper when all costs are in.
Visit suppliers before committing. The shorter travel time to European suppliers is itself a nearshoring benefit. You can visit a Polish or Czech factory, audit their quality systems, and build a relationship in a two-day trip. Do this before signing a supply agreement. The factories that look good on a Zoom call are not always the ones that perform.
Plan the transition in phases. Do not switch an entire product line overnight. Start with one SKU or one product family, run it through a full order cycle, and fix the problems before scaling. A phased approach also lets you test whether your internal systems — forecasting, purchase ordering, goods-in — can handle shorter lead times.
Build customs compliance into the sourcing decision. Before committing to a supplier, confirm with your customs broker that the goods will qualify for preferential origin under the TCA (or the relevant trade agreement for non-EU countries). Get the supplier’s statement on origin in writing. If the goods do not qualify, factor the duty into your landed cost model — do not assume it away.
Treat nearshoring as a capability, not a project. The goal is not to complete a one-time relocation. It is to build a sourcing network that can flex between regions as costs, tariffs, and risks change. That means maintaining supplier relationships in multiple regions, keeping your customs and logistics processes region-agnostic, and reviewing the sourcing mix at least annually.
Frequently Asked Questions
Is nearshoring always cheaper than offshoring? No. Offshoring still wins on factory unit cost for high-volume, low-margin products with predictable demand. Nearshoring typically wins on total landed cost when you factor in freight, tariffs, inventory carrying costs, and the value of faster replenishment. Run both scenarios for your specific product mix — there is no universal answer.
How long does it take to switch production from Asia to Europe? Most importers should plan on six to twelve months for a meaningful shift. This includes supplier identification, factory audits, sample approval, quality validation, customs setup, and a ramp-up period. Some categories move faster (simple assembly, packaging) and some are slower (products with complex component supply chains or regulatory approvals).
Do I still need customs declarations for goods from the EU? Yes. Post-Brexit, all commercial goods moving from the EU to the UK require a customs declaration through the Customs Declaration Service. Goods that meet rules of origin under the TCA can claim zero tariff, but the declaration itself is still mandatory. This is the same process as for goods from China — the difference is the duty rate, not the paperwork requirement.
What are the best countries for UK nearshoring? Poland, Czech Republic, Hungary, and Romania are the primary destinations for manufacturing. Turkey is strong for textiles and apparel. Portugal offers Western European quality with GMT alignment. The right choice depends on your product category, volume, and quality requirements — there is no single best country for all importers.
Can I run nearshoring and offshoring at the same time? Yes, and most sophisticated importers do. A multishoring model — some production in Asia for cost-sensitive lines, some in Europe for speed-sensitive lines — spreads geopolitical risk and creates flexibility. The key is having logistics and customs processes that work for both models without requiring separate systems.
Does nearshoring eliminate customs duty? Not automatically. EU-origin goods can qualify for zero tariff under the UK-EU TCA, but only if they meet rules of origin requirements. If your European supplier is assembling components from China or other non-EU countries, the finished goods may not qualify. Always verify origin status with your customs broker before finalising a sourcing decision.