Does Market Geography Drive Reshoring? Intra-European Sales as a Predictor of Relocation Decisions (2020-2025)

Details

Supervisors

Kamp, Bartholomeus

Faculty

Louvain School of Management

Degree label

Master [120] : ingénieur de gestion, à finalité spécialisée

Abstract

enThis thesis examines whether the geographic concentration of firms’ sales within Europe is associated with reshoring decisions among European companies, and whether this relationship has strengthened since 2020. While existing research has studied reshoring through supply-side drivers such as rising offshore costs, quality concerns, and supply chain disruptions, less attention has been paid to the role of market geography. Building on the literature on regionalized multinational enterprise sales and reshoring drivers, this study investigates whether firms that generate most of their revenue in Europe are more likely to relocate production back to Europe. The analysis follows a quantitative research design. First, 56 post-2020 reshoring firms are matched with comparable non-reshoring control firms by sector and size, and the relationship between European-majority sales and reshoring is tested using McNemar’s test. Second, the post-2020 reshoring sample is compared with a pre-2020 cohort of 103 reshoring firms to assess whether European-majority sales became more prevalent after the disruptions of 2020. Third, the study tests whether the sales-reshoring association differs between B2C and B2B firms. The results do not provide statistically significant support for any of the three hypotheses. However, the findings reveal consistent directional effects. Reshoring firms are more likely than their controls to generate the majority of their sales in Europe, and post-2020 reshorers are more likely than pre-2020 reshorers to be European-majority sellers, with odds ratios of approximately 1.70 in both cases. Contrary to expectations, the association appears stronger among B2B firms than among B2C firms, suggesting that operational proximity, rather than consumer preference for locally made products, may be the more relevant mechanism. Overall, the thesis provides a first empirical test of the link between sales geography and reshoring. Although the evidence remains inconclusive, the results suggest that market geography may play a role in reshoring decisions and offer a foundation for future research using larger samples and more