Day 2 of the Supply Chain Leadership Forum, and I’m on a quick break from attending sessions on inventory optimization, benchmarking transportation, and risk assessment.
Earlier in the day, we heard a great keynote presentation from Steve Ganster, Managing Director of Technomic Asia and a top-notch expert in all things involving business in Asia. And what timing! China recently took over as the second biggest economic power in the world.
Steve’s talk, “China’s Evolution and Impacts on You,” clearly demonstrates that although China has officially arrived as a major world economic power, there are still some challenges for US companies to overcome. GDP growth within China is the best it has been in 15 years, and the country stands out as a huge consumer of resources as well as a prolific breeding ground for global companies as urbanization expands. Another plus: China’s warehousing industry is entering a high growth phase.
On the other hand, the country has a poor infrastructure to support all this growth. Logistics services are expensive, and there’s a shortage in railroad capacity and uncertainty in supplier bases. Technology within facilities and among suppliers is also an issue – with low technology levels in warehouses and more than half of all logistics services companies lacking proper IT systems.
Opportunities in China are abundant, but the road is often littered with mistakes. Steve cited seven painful mistakes to avoid:
1. Putting structure before strategy
2. Taking a “snapshot view” of the market
3. Encountering unexpected competition with supplies
4. Lack of due diligence in partner selection
6. Not having enough support for the local operation
7. Being naïve during the financial planning process
It all goes back to the saying, “In China, everything is possible but nothing is easy.” True, so true.
Stay tuned for a report on the Leadership Forum’s insider’s tour of the Dallas Cowboy’s Stadium.
Go!Go!Go!
Jim
More Resources