The 2023 and early 2024 wave of nearshoring announcements — apparel, footwear, small electronics, and some home categories shifting production from Asia toward Mexico, Central America, and selectively the U.S. — was big on slide decks and short on operational detail. Eighteen months in, the operators we've spoken to over the summer of 2025 are starting to share what actually happened. The picture is mixed in a way that the original announcements did not prepare anyone for.

The timeline reality

Of the roughly two dozen public nearshoring commitments we've been tracking informally since 2023, fewer than half are on the timeline they originally announced. The rest have slipped by anywhere from two quarters to more than a year. The slippage is concentrated in two places: ramping skilled labor at the scale required, and getting tier-2 and tier-3 suppliers — fabric mills, component makers, trim suppliers — to follow the cut-and-sew operations across the ocean.

A supply chain VP at an apparel brand explained the second problem directly: "We can build a sewing factory in Mexico in nine months. We cannot build the textile mill, the zipper plant, and the elastic supplier in nine months. So we ship the inputs from Asia to Mexico, sew them, and ship the finished goods to the U.S. The landed cost on that is not what the original case said."

Where the case still works

The categories where nearshoring is delivering against the original financial case tend to share two characteristics: short product life cycles where speed-to-shelf matters more than unit cost, and bills of materials where the inputs are either domestic or easily sourced from North American suppliers.

Fast fashion replenishment programs are the clearest winner. Operators we spoke to running replenishment out of Mexico or Central America are getting cycle times measured in weeks rather than months, and the markdown improvements on accurate replenishment have more than covered the higher unit cost. A merchant at a mid-market apparel chain told us their nearshore replenishment program is the only part of their assortment hitting full-price sell-through targets in 2025.

Furniture and large home goods, where ocean freight is a meaningful share of landed cost and damage rates are high, have also shown a cleaner case. So has any category where the U.S. or Mexican government has put tariff or sourcing pressure on Chinese product — the math changes when one leg of the comparison gets a policy haircut.

Where it isn't working

The categories struggling are the ones where unit cost is the dominant variable and tier-2 supply isn't local. Basic apparel — t-shirts, socks, underwear — has largely not moved, or has moved and is being quietly moved back. Small consumer electronics have struggled to find component supply in the region. Some toy and seasonal categories did initial near-shore production runs and have reverted to Asia after the first cycle.

The honest summary from a sourcing director at a mass merchant: "Anywhere we tried to nearshore purely on cost, we lost. Anywhere we nearshored on speed or risk diversification, we're keeping it. The original financial models were too clean."

What changed in the financial case

Three things have shifted materially since the original 2023 announcements:

  • Tariff trajectory. The policy environment around tariffs on Chinese goods has continued to evolve, and operators we spoke to are now building their case on a range of scenarios rather than a single point estimate. That makes the case more defensible but harder to commit capital against.
  • Labor cost. Wages in the relevant Mexican and Central American manufacturing regions have risen faster than the original models assumed, narrowing the cost gap with Asia.
  • Ocean freight. Pacific rates have remained volatile but have not stayed at the elevated levels that made the nearshore case look easy in 2022. Some of the math that worked at peak ocean rates does not work at current rates.

The 2026 question

Heading into 2026 capex planning, the operators we spoke to are not abandoning nearshoring — but they are scoping it more narrowly. The phrase that came up repeatedly is "speed lanes": dedicated nearshore programs for the SKUs that genuinely benefit from short cycle times, alongside continued Asian production for the long-life-cycle, cost-sensitive base. The "we're moving everything to Mexico" narrative of 2023 has, in practice, become "we're moving roughly twenty to forty percent of what we said we would, and only the categories where the math actually closes."

That is a less dramatic story than the original announcements promised. It is also probably a more durable one.