Backshoring strategy and the adoption of Industry 4.0: Evidence from Europe

An analysis of the competitive priorities that may lead backshoring companies to adopt new technologies is developed and tested using secondary data from 495 relocation initiatives to Europe. Findings suggest that backshoring is associated with the adoption of Industry 4.0 when the firm's priorities are high quality and the reduction of costs tied to non-conformance. Backshoring initiatives prioritizing the reduction of direct costs or responsiveness are not significantly tied to Industry 4.0 adoption. The analysis further highlights that the adoption of new technology by firms that compete on quality is more likely when they are involved in product innovation.