Keys to China Supply Chain Efficiency
October 28, 2006 by Splatty
Filed under Supply Chain Management
The China supply chain is one of our favorite topics here at 3plwire as we have posted repeatedly on the potential pitfalls of putting all of your eggs in the China manufacturing phenomenon. In an article from Transport Intelligence, Brian Lutt, President of APL Logistics, suggests that collaboration is the key to finding success in moving your cargo from China.
He identified a number of key issues US companies face when adding the China link to their supply chains. These included cultural issues, congestion (particularly in inland transportation), connectivity between coastal and inland areas, shipment security, securing sufficient ocean and air transportation (particularly in periods of high demand) and the complexity of managing multiple currencies.
“Since China is the starting point of an enormous — and growing — number of global supply chains, companies seeking to optimize the efficiency of their individual supply chains must focus closely on improving access to best-practice logistics capabilities at the China end,” Mr Lutt said.
He also mentions that a company must “first understand the current realities of managing a China-linked supply chain”. This is absolutely critical. I believe that a lot of companies are allured by the low cost manufacturing available in China and tend to overlook the importance of logistics and the potential negative impact logistics could have on their landed costs.
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