Asia Is Leading The Supply Chain Revolution
But to maintain global competitiveness, supply chains must become a strategic priority.
And the rewards can be worth it. Modern supply chains make it much easier for small to mid-sized businesses (SMEs) in Asia to not just scale up fast, but be globally competitive.
So what exactly is Asia’s advantage?
Asia is well ahead in digitization, which delivers greater visibility and supply chain efficiency. Historically, too, the region is starting from a vastly different place. In the early 90s, Asia’s supply chains ran from a desktop and reflected technology of the time –electronic shipments such as PCs, clunky mobile phones or semi-conductors.
Trade routes were one-dimensional and linear – focused simply on delivering products from low-cost factories in Asia to highly-developed US and European markets. Trends in outsourcing, offshoring, and near-shoring were yet to come. And by the mid-2000s, just-in-time supply chains were fully established.
Fast forward to today. Global supply chains are almost unrecognizable. For starters, they’re now run on smartphones. They are more innovative, diverse, sophisticated and, critically – aligned to business strategy. Not just in the array of products and the way they’re being transported, but in best-practice supply chain solutions which are driving cost efficiencies and ensuring global trade is more accessible to all kinds of business.
Global production shifts have fed this growth, with more products now originating in Asia, traded intra-Asia, and destined not just for the United States but other major regions. With this huge transformation in trade flows, Asia has a central role in the supply chain revolution.
Intra Asia: a network shift
In contrast, developing Asian economies and businesses often started from nothing, so could hit the ground running with a fresh approach and develop new supply chain models unencumbered. Regional supply chain hubs have sprung up across Asia, from Guangzhou to Shanghai to Osaka and Singapore, giving APAC economies a bigger role in new networks. A heart patient in Taiwan can now receive a pacemaker made halfway around the world in one night. Sensitive biomaterials such as human liver cells can be sent between Japan and the US – arriving in perfect condition.
Asia’s resilience has powered change
As a result, Asia’s infrastructure and modern supply chains have evolved. In this diverse region, technology transcends culture, language, and to a large extent, regulations, to streamline cross-border trade. Looking ahead, Asia’s place at the centre of world trade looks set for some time to come.
Staying ahead of the curve
At FedEx, continuing to migrate as many of our customers as possible to automated, online solutions such as our online shipping solutions and FedEx Billing Online helps us streamline processes for a digital era and eliminate risk. We must continue to put our digital foot forward in a changed landscape; e-commerce businesses in Asia, for example, have never known anything other than electronic, integrated supply chain systems.
Staying ahead of the global competition demands technology-driven supply chains which are vital for business survival. Asia has had a head start in supply chain evolution. We must keep up the momentum, so we can multiply possibilities for the shifts and challenges ahead.