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LSCMS Blog

Blog for updates and happenings in logistics in the Asia-Pacific region

March 30, 2015

Myanmar enters the world of global trade

Filed under: Logistics,News,Newsletter — admin @ 12:46 pm

In just a few years, Myanmar has undergone a number of dramatic and positive changes, moving from harsh rule under a military junta towards open, democratic state.  Now accepted and welcomed by the global community, last year Myanmar assumed the role of Chair of ASEAN – the Association of South East Asian Nations.

Myanmar has a young and growing population of some 60 million with high literacy levels – above the global average at 92.7 per cent, on par with countries such as Malta, Mexico and Peru. Thus Myanmar offers a huge pool of labour – and over the medium term, the potential for a substantial consumer market.  The combination of a generally literate population with low wage costs – and a willingness to work to improve their economic position – provides the country with a valuable pool of human resource for its development.

With expectations that Myanmar’s economy will now experience rapid growth – and with the potential to become a major exporter, especially of agriculture and food products – observers are suggesting that Myanmar could become a trade hub on the crossroads of Asia.

The country has designated three coastal Special Economic Zones (SEZs) for development – Dawei, Thilawa  and Kyaukpyu which – together with the abundant pool of low cost labour – are already attracting some large-scale and labour-intensive manufacturing operations, particularly in the garment sector.

Infrastructure challenges are gradually being addressed. In late 2014, the Asian Development Bank (ADB) approved a USD 100 million loan to Singapore-listed Yoma Strategic Holdings to improve infrastructure connectivity needed for sustainable economic growth in Myanmar.  The loan will be used to build telecommunication towers, develop cold storage logistics, modernise vehicle fleet leasing and related projects in transportation, distribution andlogistics .

Connecting Yangon to London – global logistics provider Claridon has become the first privately-owned British logistics company to open a wholly owned subsidiary in Myanmar.  Claridon is working closely with both the Myanmar and UK Governments to help promote business links for European manufacturers and exporters to this newly emerging economy, which represents long term opportunities for almost all business sectors.

Claridon Group was the first British company to be invited to meet the country’s Transport Minister for private talks.  The meeting focused on raising awareness among British exporters of the opportunities in Myanmar and included a session with a Myanmar Ministerial Delegation to discuss and advise on such matters as regulatory framework, private sector development, anti-corruption measures and private-public partnership initiatives.

Myanmar has started its new journey to economic prosperity from a very low base. The economy is one of the least developed in the world, following decades of stagnation, mismanagement and isolation.  However, its rich natural resources – both mineral and agricultural – and its strategic location in the most dynamic part of the globe, make the country a highly attractive investment opportunity.  –ends- (470 words)

Mark MillarMark Millar has completed over 375 speaking engagements at corporate events, client functions and industry conferences across 23 countries, and is renowned for delivering a knowledgeable, professional and memorable impact. Author of “Global Supply Chain Ecosystems” from Kogan Page, Mark is a Visiting Lecturer at Hong Kong Polytechnic University and is named in the 2014 USA Listing of “Top Pros-to-Know in Supply Chain”. mark@markmillar.com

 

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March 28, 2015

Vietnam’s Growth Poised to Take Flight

Filed under: Logistics,News,Newsletter — admin @ 11:17 am

VietnamThe past few years have been challenging for the Vietnamese economy. The heady growth years that followed the beginning of doi moi1 when the country opened to the global economy and international trade for the first time were, incredibly, over a quarter of a century ago. We know. We were there. DHL was in fact the first international logistics company to set up shop in Vietnam in 1988.

Over the years, we’ve seen the pace of economic growth slow and even stall a couple of times as a result of global recessions and the Asian financial crisis. However since 2012, we’ve noted a significant pick-up in the global demand for exports. The World Bank reports that world trade grew steadily to 3.3 per cent in 2014 and that global gross domestic product (GDP) is expected to be up by 3.6 per cent this year2. For members of the Organization for Economic Co-operation and Development (OECD), the World Bank predicts GDP growth of 2.3 per cent this year and 2.4 per cent next year, whereas for the BRIC countries those figures are double – 5.1 per cent this year and 5.5 per cent the next.

Poised for take off
So where does this leave Vietnam? Well, in the words of the OECD4 ‘Some of the stalled cylinders of growth are beginning to fire again’ – the country is a robust growth market and is predicted to grow strongly in the coming years. In fact, the Economist Intelligence Unit is forecasting Vietnam’s GDP growth in 2015 to be 6.2 per cent, before accelerating to 6.4 per cent a year between 2016 and 20195. This is led primarily by foreign direct investment and exports and performing slightly better than the global and regional averages.

[Read more… Curated from Logistics Insight Asia]

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The Future of Fuels for Commercial Transport

PodcastWith the current boom in U.S. oil and natural gas production, it might be tempting to put aside the notion of shifting to more sustainable fuels for commercial transport. Why venture into this unknown area when traditional supplies are so plentiful?

The answer: the current state of affairs can’t last. Now is the time to begin exploring which kinds of alternative fuels have the greatest potential to power heavy trucks and other modes of transport in the years ahead. On this episode, we speak with Ryan Schuchard, associate director for climate change with BSR, a non-profit network of multinational companies dedicated to reducing carbon emissions and forging greener supply chains. He shares the results of a recent study by BSR’s Future of Fuels initiative, laying out the various options and answering some key questions: Which alternative fuels are best? What will they cost? How effective will they be? And how will we cope with a 40-percent increase in energy consumption between 2012 and 2030? Hosted by Bob Bowman, Managing Editor of SupplyChainBrain.

[Read more… Curated from Supply Chain Brain]

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March 27, 2015

Advances in Analytics Allow New Thinking in Human Resources, Talent Recognition

Filed under: News,Newsletter,Resources,Supply Chain Management — admin @ 11:12 am

People in businessThe latest data and analytics buzz comes from the field of advanced HR analytics, where the application of new techniques and new thinking to talent management is becoming more mainstream. The implications are dramatic because talent management in many businesses has traditionally revolved around personal relationships or decision making based on experience—not to mention risk avoidance and legal compliance—rather than deep analysis. Advanced analytics provides a unique opportunity for human-capital and human-resources professionals to position themselves as fact-based strategic partners of the executive board, using state-of-the-art techniques to recruit and retain the great managers and great innovators who so often drive superior value in companies.

The insights have been surprising and at times counterintuitive. McKinsey expected factors such as an individual’s performance rating or compensation to be the top predictors of unwanted attrition. But their analysis revealed that a lack of mentoring and coaching and of “affiliation” with people who have similar interests were actually top of list. More specifically, “flight risk” across the firm fell by 20 to 40 percent when coaching and mentoring were deemed satisfying.

[Read more… The full article in The McKinsey Quarterly]

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March 25, 2015

Latin America May Suffer if Oil Prices Continue to Be Depressed

Filed under: News,Newsletter,Supply Chain Management — admin @ 11:40 am

Fuel pricesThe consensus among analysts is that cheaper oil should be broadly neutral for Latin American countries in general, with clear winners and losers. Their expectation is that net oil exporters will suffer from lower oil prices and net oil importers will benefit. Although we can agree with that general short-term diagnosis, it is predicted that a sustained period of lower oil prices will have a net negative impact on Latin America and on the prospects of U.S. manufacturing companies doing business…

The Short-Term Impact
Countries in which the oil industry represents a large share of total economic activity and those whose fiscal revenues are heavily dependent on oil will take the largest hit. And that negative effect on growth is immediate, not only because lower fiscal revenues are already slowing down public spending, but also because of balance of payments–related issues. Oil exports are for many countries in the region a source of hard currency that allows imports of intermediate and final goods that make up the backbone of numerous economic activities. A lack of oil-generated hard currency inflows to pay for imports will surely negatively influence short-term economic growth.

[Read more… Curated from the Manufacturers Alliance for Productivity and Innovation]

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March 21, 2015

A Supply Chain World Tour

Filed under: China,News,Newsletter,Supply Chain Management — admin @ 11:08 am

Aiming for global marketsglobCompanies doing business globally are learning to be more flexible to adapt quickly to uncertainty without sacrificing economy, speed and service.

Shifting demand dynamics, geopolitical volatility, currency fluctuations, government interference, lengthening and deepening supply networks, and cost reduction directives have conflated to consternate even the best supply chain strategies. That’s why U.S. companies are flexing Incoterms to optimize point-of-origin logistics and reduce freight costs. It’s why consignees are ordering smaller quantities from more suppliers, and using consolidation hubs in China and Hong Kong to fill containers. And it’s why mobile phone manufacturers are decoupling shipments of higher-value units and lower-value accessories, and using packaging postponement strategies to better optimize air and ocean modes.

There’s no doubt that the world’s middle class is marching toward Asia. Eventually, even more manufacturers and retailers will follow. The maturation of e-commerce, and the relative speed and ease with which producers and consumers can tap this emerging global marketplace, is beyond comparison. To remain competitive globally, U.S. companies need to be nimble to these demand changes. That means digging deeper into analytics, modeling potential inputs and outputs, and finding reliable logistics service providers that can facilitate new relationships and provide cover in growing global markets.

[Read more… Curated from Inbound Logistics]

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March 19, 2015

B2B Procurement Begins to Feel Emergence of Millennials

Filed under: News,Newsletter,Research,Supply Chain Management — admin @ 11:38 am

Influencer shiftMillennial influence within business-to-business buying decision groups is growing rapidly, according to a study by Google and the research house Millward Brown Digital.

According to the study, 46% of potential buyers researching b-to-b products are millennials today, up from 27% in 2012. They’re now the biggest generational group researching b-to-b products for potential purchase. “We saw a big shift in a two-year time span in the number of millennials that are in the b-to-b purchase path,” said Mike Miller, Google’s director of business and industrial markets.

[Read more… Curated from Ad Age]

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March 18, 2015

Loscam’s Intermediate Bulk Container Brings Innovation to Liquid Logistics

Filed under: Logistics,News,Newsletter — admin @ 11:21 am

loscam_ibc_18Loscam announced the release of IBC I8, its new intermediate bulk container designed for the transportation of liquids.

Loscam, a provider of returnable packaging solutions, announced the release of IBC I8, its new intermediate bulk container designed for the transportation of liquids. The IBC I8 is made from polypropylene and features a hygienic ‘bag in a box’ system which the company claims will make it easy for food and manufacturing companies to fill, transport and discharge product.

Loscam’s heavier duty IBC I6 already caters for more robust and non-acidic applications including dairy, oils, and liquid sugar. nudie, one of Australia’s leading beverage companies is using the IBC I8 to transport its fruit juices across the country.

[Read more… Curated from Logistics Insight Asia]

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March 17, 2015

Asia Supply Chain Insights: e-Commerce frenzy the biggest challenge for Asia Logistics in 2015

Filed under: Logistics,News,Newsletter — admin @ 1:07 pm

With the Asia Pacific region now representing over 35% of the global B2C e-commerce market – valued at over USD 1.5 trillion – 2015 will present some significant challenges for logistics in Asia.

The fastest growth in e-commerce is occurring in emerging markets, where transportation infrastructure and logistics capabilities are much less well developed than in the west.

In Asia, by far the biggest supply chain challenge arising from the digital revolution is e-commerce logistics – in contrast to the developed markets where omni-channel retail is stress-testing even the most sophisticated supply chain ecosystems.
Driven by an upwardly mobile middle class with a taste for Western brands, coupled with massively expanding rates of internet access and digital empowerment through ubiquitous mobile phones, the e-commerce markets in Asia are experiencing exponential growth that McKinsey forecast could generate online sales of USD 650 billion in China alone by 2020.

The massive increase in online sales is driving exponential expansion in the need for comprehensive B2C logistics networks, stretching Asia’s express logistics capabilities like never before.

Furthermore, Alibaba research reports that consumers in small cities and remote areas – with no large shopping malls and not much modern retail – actually spend a larger proportion of their disposable income via e-commerce, than those in the large cities where brand-name stores and high street retail are plentiful.

Across Asia, there are millions and millions of digital-native consumers that have never been to a supermarket or a department store, but are now equipped with smart phones and empowered by always-on and all-pervasive internet access, and can thus shop online as if they were in Macy’s in New York or Harrods in London!

But in an environment of predominantly old-stock warehouses and relatively under-developed logistics systems, the challenges of single-unit fulfilment and last-mile home delivery to consumers in the far-flung hinterland regions becomes operationally challenging and often prohibitively expensive, not to mention the cost and complexity of delivering on the promise (insanity?) of free-returns policies.

For 2015, we can expect continuing exciting omni-channel developments in Asia, embracing plentiful challenges and opportunities in this rapidly growing sector of e-commerce and the logistics networks that empower online supply chain ecosystems.

Mark MillarMark Millar leverages 25 years global business experience to provide value for clients with independent and informed perspectives on their supply chain strategies in Asia. His forthcoming book ‘Global Supply Chain Ecosystems’ – to be published by Kogan Page in June 2015 – explores the latest trends and developments across emerging, developing and developed markets, and presents detailed and practical insights that will help you capitalise on market opportunities, overcome supply chain challenges and make better informed business decisions. www.koganpage.com/globalsupplychain Acknowledged as an engaging and energetic presenter, clients have engaged Mark as Speaker, Moderator, MC or Conference Chairman at over 350 events in more than 20 countries. mark@markmillar.com

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Container Shipping Today: Mega-Ships and Mega-Problems

Filed under: Maritime,News,Newsletter,Supply Chain Management — admin @ 11:12 am

Hapag-Lloyd-ShipIf we’re to believe the big container lines, ever-larger ships are the remedy for their financial woes. Why, then, are so many of them still losing money?

In the size race, Maersk Line has been leading the pack, with its Triple-E vessels of 18,000 twenty-foot equivalent units (TEUs). But nearly all of its chief rivals, including Mediterranean Shipping Co., CMA CGM, Evergreen Line and China Container Shipping Lines, are catching up with their own mega-vessels. Japan’s Mitsui O.S.K. Lines (MOL) recently announced an order for six 20,150-TEU ships, and Maersk, among others, is expected to match that latest benchmark.

These behemoths of the sea are supposed to provide carriers with unprecedented economies of scale, which will yield steady profits while accommodating the surge in international trade that is projected for the coming years. But you have to wonder whether they create as many problems as they solve.

[Read more… Curated from Supply Chain Brain]

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