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New study shows: In-house production pays off

In-house production pays off and can increase profits and productivity, outsourcing harbors risks. This is the main result the study “The value of value added – advantages and necessity of local value chains” carried out by the ILIN and the Fraunhofer Institute for Systems and Innovation Research ISI. The study funded by the Ministry of Finance and Economics Baden-Wuerttemberg shows that in-house value creation has a significantly positive influence on profit and productivity. Outsourcing to foreign suppliers should therefore be assessed more critically. Manufacturing companies based in Baden-Wuerttemberg already have above-average in-house value added and should expand this path to success in future-oriented fields like electric mobility. The complete study is available in German.