Economic Sovereignty: a unique opportunity for supplier innovation?

Is it credible to consider repatriating production that has been relocated for the sole purpose of reducing prices?

I firmly believe there is a unique opportunity to reconcile environmental and societal responsibility with economic sovereignty.

The isolationist choices of 15th century China

In the 1420s China followed a period of international influence with a long season of isolationism. China, by making this choice, gave way to the Portuguese, who then build a huge trading empire based on colonial counters. This missed opportunity reduced the Middle Kingdom to a second rank power in a world already in the process of globalization. The effects lasted for centuries, since China’s GDP only began to grow in the 1980s. 

A unique opportunity for convergence 

History shows us that withdrawal impoverishes countries and minds. Victor Hugo at the 1849 Peace Congress pronounced this divinatory phrase: “The day will come when there will be no other battlegrounds than markets opening up to trade and minds opening up to ideas…”.

Relocating production to France, in addition to being illusory, is dangerous. It is only innovation which will enable France to rebuild its industrial fabric, and the environmental conversion that is finally on the horizon is an opportunity not to be missed. This (chance) opportunity to reconcile environmental and societal responsibility with economic sovereignty is unique.

The consumer is always right

We should remember that only a few months ago, under pressure from consumers and animal protection associations, supermarkets and hotel chains drove caged eggs off their shelves and menus. The transition was successful because consumers have decided to no longer condone the confinement of animals. This example proves that it is still the citizens who remain in control of what they consume. 

A dizzying fall of the industrial sector 

Since the year 2000, the weight of industry in the French GDP has fallen from almost 25% to less than 12%. France should seize the opportunity to take advantage of the weaknesses in the globalized value chain revealed by the Covid crisis. But strategic choices will be necessary.

Thus, manufacturers who rushed to produce masks in France at a time when the country was sorely lacking in such protection, now find themselves with a stock of 50 million unsold masks. The Chinese producers, after having responded to the demand of their fellow citizens, have in fact hastened to deliver to the rest of the world. We will therefore have to come up with ideas to manufacture products in France that have not become commodities. This requires innovation and therefore value creation. 

The opportunity and the risk

Let’s take the example of plastic: There are plant-based plastics that have never really found their customers, mainly because of their cost. The company that will manage, through innovation, to produce plastic from vegetable wastes will be able to afford to manufacture it locally. In any case, it will have to be strongly encouraged to do so. 

However, opportunity and risk are both sides of the same coin. Because of the economic consequences of the health crisis, according to a survey conducted by Founders Factory, 64% of major French groups plan to reduce their innovation budget. However, this is not the time to pull out. French companies must consider the manna of innovations that their suppliers are ready to offer them if only a spirit of collaboration could be established in business relationships.

As was theorised by Procter & Gamble half a century ago, 70% of innovation should come from suppliers. It is time to call on partners who are just waiting for a signal to unleash their creativity.

Profile photo of Elvire Regnier Lussier

Elvire has an international procurement career in several sectors such as FMCG, Construction, Chemicals and Energy. She served Colgate in NY as Global Procurement Director Personal Care. In 2011 she joined Unilever as Global VP of the “Partner to Win” program. In 2013 she became Avril (Energy, Chemicals) CPO.

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