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Global Sourcing Spotlight: Beyond China Plus One—Building a Truly Global Supply Network

China Plus One has been the go-to strategy for companies looking to diversify their supply chains without giving up the advantages of manufacturing in China. Keep China in the mix, add capacity in Vietnam, Thailand, India, Malaysia, Mexico, or another country, and reduce the risk of relying too heavily on one manufacturing region.

But adding another country does not necessarily create a diversified supply chain.

Today’s sourcing environment requires a broader approach. Rather than simply looking for an alternative to China, companies need to determine which manufacturing regions make the most sense for particular products, customers, and markets. The goal should not be diversification for its own sake, but a global sourcing network built around the capabilities a company actually needs.

That starts by moving away from the idea that every product should be manufactured in the same location. Manufacturing regions have different strengths, limitations, specialties, and competitive advantages.

China, for example, remains one of the world’s most sophisticated manufacturing centers. Its infrastructure, supplier ecosystem, engineering resources, automation investments, and manufacturing scale remain difficult to match in many industries. Despite headlines suggesting companies are abandoning China, the reality is far more nuanced. For many complex electronic products, China continues to offer capabilities that are difficult to duplicate elsewhere.

The goal is not necessarily to replace China. It is to determine where China remains the best solution and where another region offers a strategic advantage.

Vietnam and India have both attracted significant electronics manufacturing investment, although for different reasons. Vietnam has expanded its industrial base, infrastructure, and technical capabilities, while India combines a large engineering talent pool with government incentives and growing domestic manufacturing initiatives. Other Asian manufacturing centers offer specialized capabilities in semiconductors, advanced electronics, precision manufacturing, and high-reliability applications.

The same evaluation applies outside Asia. Europe remains important for products requiring sophisticated engineering collaboration, regulatory expertise, and specialized manufacturing. In the Americas, Mexico has become a major manufacturing hub for companies looking for shorter transportation times and closer proximity to North American customers. Domestic manufacturing in the United States and Canada also remains essential for many defense, aerospace, medical, and other highly regulated applications.

The question, then, is no longer which country is best, but which country is best for this specific product, customer, market, and business objective?

Cost will always be part of that decision, but the lowest piece price rarely produces the lowest total cost. Freight, tariffs, inventory, engineering delays, quality issues, customs, and production interruptions can quickly change the equation. Evaluating total landed cost provides a much clearer picture than purchase price alone.

Engineering support can be just as important. Many of today’s electronic products require close collaboration between designers and manufacturers throughout development and production. Material selection, process optimization, yield improvement, and rapid engineering feedback can determine whether a program succeeds. A manufacturing partner with strong engineering capabilities may ultimately deliver more value than one selected primarily on price.

Quality expectations also must remain consistent in every manufacturing location. Diversification only works if suppliers meet the same standards regardless of geography. Qualification, auditing, documentation, and ongoing communication become even more important as the supply network expands.

That work needs to happen before an alternative supplier is needed. Waiting until a disruption occurs leaves companies qualifying new manufacturing partners under pressure. Auditing facilities, validating capabilities, establishing engineering relationships, and conducting pilot builds in advance provide options when conditions change.

This preparation also matters to customers. They want to know how suppliers are addressing contingency planning, manufacturing redundancy, geographic diversification, cybersecurity, and business continuity. A company with qualified manufacturing options can answer those questions with something more substantial than a plan on paper.

Technology can help companies manage these increasingly complex networks. Better visibility, predictive analytics, AI-assisted forecasting, and supplier monitoring can help sourcing teams identify risks and evaluate alternatives sooner. These tools are valuable, but they support sourcing expertise rather than replace it.

Global sourcing will continue to change. Trade policies, transportation networks, currencies, manufacturing capabilities, and customer requirements will influence where products are built. A sourcing strategy that works today may need to be adjusted tomorrow.

That is why the strongest global supply networks are built for flexibility. They give companies qualified options and the ability to move when business conditions require it.

China Plus One remains a useful concept, but simply adding another country is not a sourcing strategy. The real work is determining what each product requires, where those capabilities exist, and which manufacturing partners provide the right combination of cost, quality, engineering support, and supply security.

The goal isn’t to find the next country. It’s to build a supply network with the right options before you need them.

Bob Duke is president of the Global Sourcing Division at American Standard Circuits.