Pandemic shocks and geo-political tensions fuel supply chain disruption and innovation
By Asialink Business
(Melbourne, 15 September 2021) Faced with unprecedented disruption and strain, businesses in Australia and Asia need to rapidly transition to equip their supply chains for current and future challenges. New research launched today by Asialink Business, supported by Toll Group, analyses the structural pressures on supply chains and argues that technology, innovation, and e-commerce will be key to building sustainable and resilient supply networks.
The research, which included a survey of businesses across Australia and the region, found that supply chain uncertainty is hitting small business hardest. Thirty-two per cent of small businesses surveyed said restrictions on business could threaten their operations, compared to 15 per cent of medium-sized businesses and eight percent of large businesses.
“The COVID-19 pandemic, rising geopolitical tensions and extreme weather events have put supply chains globally under strain. To remain competitive in our increasingly competitive region, business will have to invest more in resilient and sustainable supply chains to meet the shifting needs of customers in Australia and internationally,” Peter Varghese AO, Chair of Asialink, says.
Positively, many businesses are already taking steps to adapt, a point recognised by Toll Group, a leading transport and logistics company across Australia and the Asia Pacific:
“Businesses face a challenge to transform legacy supply chains for the future. But we also have a unique window of opportunity to reorganise and become more adaptive and inter-operable with partners in the region. With supply chains across Asia fundamental to businesses in Australia and beyond, agile planning is critical to future business success,” Thomas Knudsen, Toll’s Managing Director added.
The research identified a trend towards moving production back home (onshoring) or into nearby countries, diversifying suppliers and boosting inventory. Onshoring is particularly appealing to small business, with 30 per cent of those surveyed considering it as an option to improve their resilience.
To equip for future challenges, businesses need to understand and respond to this trend, along with three other major transformations:
The research found that adoption of new technology — such as the Internet of Things, data analytics, artificial intelligence (AI) and Machine Learning — are critical to supply chain transformation. However, Australian business needs to accelerate the uptake of technologies that impact their supply chain or risk being left behind. This is particularly acute for small/medium business. The survey revealed that 27 per cent of medium business, and just 13 per cent of small business are investing in AI for supply chains, compared with 42 per cent of big business.
With a strong call to action to supply chain leaders to prepare now, the report also recommends stronger partnership with government, to support business to develop resilient and sustainable supply chains that meet the needs of citizens in Australia and across the region.
Download the report here: https://asialinkbusiness.com.au/research-resources/disruption-innovation-reshaping-regional-supply-chains
Asialink Business
Heather Chai, Head of Communications & Public Relations
Heather.chai@asialinkbusiness.com.au / Mob: +61 423 035 277
Toll Group
Michael Zappone, Senior Communications Manager
Michael.zappone@tollgroup.com / Mob: +61 438 004 959
About Asialink Business | Asialink Business is the National Centre for Asia Capability. Think Asia, think Asialink Business. We support businesses and organisations in all sectors to develop the critical skills, knowledge and networks needed to better understand and do business with Asia. Our tailored capability development, strategic advisory and advocacy services enable our clients to grow and expand in Asian markets. Find out more at asialinkbusiness.com.au
About Toll Group | At Toll, we do more than just logistics - we move the businesses that move the world. Our 20,000 team members can help solve any logistics, transport or supply chain challenge – big or small. We have been supporting our customers for more than 130 years. Today, we support more than 20,000 customers worldwide with 500 sites in 25 countries, and a forwarding network spanning 150 countries. We are proudly part of Japan Post — www.tollgroup.com