The China Plus One (C+1) is a business strategy and a macro-level phenomenon where multinational corporations diversify their supply chains and manufacturing operations away from an over-reliance on China. The concept is believed to have been formally introduced around 2013, though its roots trace back to the early 2000s when events like the SARS epidemic (2002-2003) exposed the vulnerabilities of single-country production. The strategy emerged to solve the problem of overconcentration of business interests in China, driven by factors like rising labor costs, geopolitical tensions, and global disruptions.
The mechanism involves companies maintaining a presence in China while expanding operations to at least one additional country, such as India, Vietnam, or Thailand. This diversification is a form of risk mitigation, allowing companies to control costs and access new markets. The strategy connects to broader concepts like supply chain resilience and is often accelerated by geopolitical events like the U.S.-China Trade War (2018 onwards) and China's "Zero-COVID" Policy during the pandemic.
Recently, the strategy has evolved from a cost-driven experiment into a core risk management play. This shift is evidenced by the emergence of the "China Plus Many" model, where companies spread operations across multiple countries instead of just one. The core principle of reducing dependency on a single manufacturing hub remains, but the drivers have become more focused on geopolitical stability and resilience.