Subscribe to our free, weekly email newsletter!


Global Logistics: Asia Pacific’s challenges and opportunities in market integration

By Patrick Burnson, Executive Editor
September 01, 2012

Look before you leap
Given the recent history of supply chain disruption in the region, U.S. shippers seeking to enter the Asia Pacific markets are advised to proceed with caution. Just when automobile factories had begun to recover from the Japanese tsunami in 2011, the high-tech sector took a huge hit when Thailand was dealing with catastrophic flooding.

This year it was India—Asia’s third largest economy—that gained the spotlight and added scrutiny of risk mitigation analysts. That nation’s massive power outage this past summer should serve as “wake up call” for many multinationals, says analysts.

The power grid failure can have a ‘domino effect’ on businesses, communications and IT systems,” says Linda Conrad, director of strategic business risk management for Zurich Services. “Furthermore, this will weaken supply chain infrastructures including all forms of transportation, which could have a major affect on multiple industries.”

With emergency workers and energy professionals still searching for clues to India’s electricity grid collapse, logistics managers should consider risk mitigation strategies now, says Conrad. “As we learned from natural disasters in Japan and Thailand, the ripple effect can be devastating on second- and third-tier suppliers,” she says. “Companies that are over-exposed in India now might consider some supply chain alternatives for 2013.”

Conrad notes that many countries including the U.S. outsource call centers and IT services to countries like India. She says an outage like this can cause serious damage to businesses that rely on those services such as hotel chains and technical support. “It should also give us pause to consider what might happen if a similar shutdown occurred if there was a terrorist attack on India’s power grid. The situation might be even worse.”

image

About the Author

image
Patrick Burnson
Executive Editor

Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at .(JavaScript must be enabled to view this email address).


Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

Of special interest to readers of Logistics Management will be “Americas Update,” which will look into the future of the market in the Americas and assess how firms will be able to favorably position themselves to compete and win market share.

After 20 years, two congressional mandates and countless lawsuits and lobbying efforts, safety advocates and the Teamsters union still say there are too many inexperienced rookie truck drivers hitting the road without sufficient behind-the-wheel training.

Congested U.S. port terminals, harbor and over-the-road truck and driver shortages, slower trains and longer rail terminal dwell times due to increased domestic rates have not only disrupted service but also driven intermodal rates and cargo handling costs up sharply.

Southern California shippers are getting a break on container dwell expenses for the next ten days as the Port of Long Beach announced that it had added an extra three days to the time that overseas import containers can remain on the docks without charge.

The long-simmering court battle over whether FedEx Ground’s workers are independent contractors or employees appears headed to the appellate courts—and maybe the U.S. Supreme Court.

Comments

Post a comment
Commenting is not available in this channel entry.