China’s Manufacturing Costs On the Rise?
August 16, 2006 by Splatty
Filed under Supply Chain Management
In yet another example that China’s manufacturing advantage might be plateauing, Li & Fung, one of the world’s largest trade sourcing companies has been forced to increase operations in more competitive areas in South Asia.
One of the main beneficiaries has been south Asia, with Li & Fung purchasing in India, Bangladesh, Sri Lanka and Pakistan now increasing by more than 40 per cent a year.
“There has been a large shift in sourcing trends,” said William Fung, Li & Fung’s managing director. “In this chaotic situation you have to keep all your options open.”
This diversification away from China has enabled the company to offer clients lower prices again.
The company cited rising labour costs and other costs as the key drivers behind the shift in manufacturing locations. source – World Trade Magazine
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