As businesses assess their operational capacity needs for a predicted bumpy recovery, to recalibrate during and post-pandemic, it is crucial to understand what brought us to this point and where it is likely leading us.

The Pacific Basin Economic Council (PBEC), Monash University Malaysia and KPMG, together with contributions from PBEC members, are pleased to publish this report on global sourcing, reviewing the most recently announced supply chain and sourcing movements in the region, charting a new course in Asia Pacific.

The data in this report, provided in collaboration with Monash University Malaysia, comprises a sample of 132 companies that are considering changing or have already altered their supply chain destinations between 2018 and 2023, covering 232 sourcing market moves.

Through web scraping 1,089 relevant news articles were collected from multiple sources, as well as company reports published between 1st January 2016 and January 31st, 2022. In addition, official information and company documents were collected from companies' webpages as a "measuring stick" to ensure the accuracy of the information.

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Charting a new course in Asia Pacific

Regional trends in global sourcing

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The report provides some key takeaways and recommendations for business leaders to consider. More importantly, it provides an up-to-date guide on navigating their business through these turbulent times. The report seeks to evaluate the trends and examine the following three areas of interest:

What where how

The initial observations from the data are that an extensive overhaul of supply chains and sourcing moves are not necessarily taking place in Asia Pacific. Instead, the data suggests a more considered approach to the pandemic’s supply chain impacts in the region and highlights other reasons behind the movements in capacity. There is a more bullish view on globalisation from Asian-based business leaders, and an increasing appetite for investments in technology to enable increased visibility and traceability to manage supply chains.
Some of the trends observed from the data have placed leading brands and corporations under a magnifying glass, to a point where it became an urgent requirement to obtain the ability to track and trace their supply chains beyond tiers 1 and 2. This has led many companies to upgrade their I.T. capabilities and cyber security protocols and announce strategic partnerships and acquisitions in the ESG specialist space.

This highlights the importance the global business community is putting on the development of a digitally-enabled circular economy, as boards pay more attention to reputational risks and public perception associated with the sustainability of business practices.

Read the report to uncover sourcing shift patterns in Asia Pacific.

We see a dynamic sourcing market in which key players are actively seeking strategies that can allow them to future proof their businesses. While we see various factors that have contributed to sourcing moves, businesses should put purpose and sustainability foremost when making decisions. The resilience of businesses is intrinsically linked to our collective efforts to help secure a sustainable future for the planet and its people.

Anson Bailey
Head of Consumer & Retail, KPMG Asia Pacific

The emergence of the COVID-19 pandemic three years ago was a wake-up call for sourcing leaders as they clamoured to secure products and resources when inventory was low, particularly across key industries such as electronics and retail. Finding just-in-time air transportation capacity was challenging and expensive as sea freight and ports were severely affected. Since then, it's been observed that more companies have taken a longer-term view, balancing trying to remedy the ongoing disruptions in the supply chain with making data-driven technology and capacity investments for the future. China continues to shift its focus further upstream in the supply chain and production quality as inflation and rising costs of doing business take their toll.

Author & Professor Neale G. O'Connor
Head of Department, Monash University Malaysia

The combination of intensified brand-supplier collaboration and increased near-shoring can provide an effective lever to tackle the continued challenges of demand and supply market uncertainty.

Michael Walsh

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