The COVID-19 pandemic exposed the fragility of global business operations, with particular disruption to cross-border supply chains. For companies dependent on production in China, the impact was great.
Despite China’s tenacious economic recovery in 2020, and a predicted 6% GDP growth this year, our clients and partners expressed concerns about reliance on supplies flowing from China and the APAC region.
However, our research indicates that companies, especially in manufacturing, risk ‘missing out’ on the huge benefits of engaging with the region during this challenging period.
Key findings: The issues challenging foreign companies
- Continued travel restrictions to Mainland China and Hong Kong
- Increased transportation and manufacturing costs in China
- Policy changes, e.g. China’s Dual Circulation strategy, German Supply Chain Law
- Readjusting sourcing strategies, e.g. China+1 supply chain diversification
- Digitising and upgrading supply chains
Acclime’s Trade & technology team: Supply chain expertise from industry specialists
We act as our clients’ eyes and ears across APAC, helping companies implement mobility and risk mitigation strategies for continued growth, even in uncertain times. We can help with:
- Operation outsourcing e.g. order/shipment handling and bonded warehouse solutions
- Consulting & advisory e.g. supply chain optimisation and China e-commerce
- Ad-hoc support e.g. product sourcing and trade show support
Business challenges in focus
1. The Potential Impact of the Dual Circulation Strategy (DCS)
Amid an increasingly unpredictable global environment, the DCS is expected to see China focus less on export-oriented development strategies and more growth fueled by the domestic market.
Our Solution: Help clients assess current sourcing models and conceptualise alternative scenarios for greater cost efficiency.
2. China +1
Facing rising costs in China, foreign companies are increasingly shifting part of their production to other lower-cost countries in the region.
Our Solution: Help clients benchmark operations against best practices, review the supplier portfolio and identify new suppliers based on, for example, compliance, competitiveness, and production quality and capacity.
Case Study: Rethinking Global Logistics
To help our client optimise their supply chain, we advised them to shift their logistics hub from Germany to Asia, where the company sources its products. Using this new hub for global deliveries and outsourcing related operations to Acclime, significantly reduced costs and improved operational efficiency.
With decades of experience, Acclime’s Trade Solution experts have supported Western companies in streamlining and managing business operations in China and the wider APAC region. Reach out to discuss the ways we can help your business thrive.