Last month, in Moving Manufacturing to Vietnam, Thailand, Malaysia, or India (Pros & Cons), I compared 4 manufacturing hubs in Asia that seem well-positioned to receive additional activity, as many American companies try and "decouple" from China: Ho Chi Minh City (Vietman) Kuala Lumpur (Malaysia) Bangkok (Thailand) Chennai (India) Chennai has been ramping up its manufacturing activity Well, it seems Chennai has been ramping up its activity fast. Maybe even too … [Read more...]
SE Asia and India are more competitive than China on wages as of 2021, but should we abandon China?
We started comparing the average wages across Asia in 2015 to help importers decide which country might be the best option for them to source from. As I mentioned before, you need to consider the following data (among others): The trend of the average wages in the countries in question The stability of exchange rates, for example against the US dollar Back in 2015, China's increasing wages were followed by other neighboring countries. Its 'real' cost of skilled factory labor, which … [Read more...]
Manufacture in China, Vietnam, India, or Elsewhere in 2021? [Podcast]
Manufacturers continue to plan the move of some or all of their supply chains out of China? But where next? Perhaps the word 'exodus' is a little over-dramatic, but there has certainly been a marked rise in companies trying to diversify their manufacturing operations away from China alone since around 2018. One reason is the US/China trade war and the punitive tariffs imposed by the US government on some 'Made-In-China' goods, but we can't discount the coronavirus pandemic, as the manufacturing … [Read more...]
Supply Chain Risk Management, Part 5: Moving Manufacturing to Vietnam, Thailand, Malaysia, or India (Pros & Cons)
One of the main conclusions of many companies is as follows: 'diversifying our supply chain outside of China is a must in order to reduce risk'. There are two main reasons for this. First, the USA has been leading the charge against Beijing, and any change in the White House will not stop the current trend to "decouple" from China. The general public, the Congress, and the Senate all seem to agree that China is a "strategic competitor" and needs to be opposed. Second, some disasters can … [Read more...]
Sourcing Trends in 2019 between China and other Asian Countries
I attended the Made in Asia conference last week, and the opening talk was given by Ben Simpfendorfer (Founder & CEO at Silk Road Associates, a strategic advisory firm based in Hong Kong). Ben is one of the most insightful people I know when it comes to covering sourcing trends in China and other Asian countries. Here are some of the interesting points he mentioned. The market shares of different Asian countries (Vietnam, Bangladesh, Indonesia, India...) haven't been changing as … [Read more...]