Supply Chain Opportunities in China - DSV/media/NL/Images/Nieuwsbrief/Nieuwsbrief 2015 juli... ·...

Supply Chain Opportunities in China

Amsterdam, June 24th I Sea Palace

2 | DSV – Sea Palace Restaurant, Amsterdam June 2015

China has a HUGE potential…

Area: 9,596,961 km2

• World's 4th largest country (after Russia, Canada & USA)

• Stretching 5,000 km from East to West , 5,500km from North to South

• One-third of China’s land area is made up of mountains

• The Great Wall is 21,196km long, all branches included

China Geography Tropical, Arctic, Desert; China has it all!



China Population

Area: 9,596,961 km2

• World's 4th largest country (after Russia, Canada, & USA)

• Stretching 5,000 km from East to West , 5,500 km from North to South

• One-third of China’s land area is made up of mountains

• Length of the Great Wall … 21,196 km all branches

Population: 1,354,040 (2012) Density: 138 per km2

• The population of China is more than 1.3 billion people, the largest national group in the World

• Han Chinese 91.5% (56 different minorities)

• Two-thirds of the Chinese people are farmers, but only 4% of China’s land can be cultivated

• +160 Chinese cities have +1 million inhabitants

http://www.google.com/url?sa=i&source=images&cd=&cad=rja&docid=1202dyfByNYPDM&tbnid=xjK5cuJoDiWSDM:&ved=0CAgQjRwwADjeAQ&url=http://online.missouri.edu/exec/data/courses/2342/public/lesson02/lesson02.aspx&ei=OmqwUe65EMGdtAbg1AE&psig=AFQjCNH_COlHcerN-ZezpCSAtToKmleJPg&ust=1370602426331419



China Economy

GDP: CNY 52.76 Trillion (2012) (World 2nd largest economy after USA)

• GDP Growth 2013: 7.5%

• GDP per Capita: CNY 55,800 (USD 9,100)

• Labor Force: 795 million (World Largest)

• Oil consumption 9.40 million bbl/day (2012)

• Middle class consumers: +200 million

• Chinese winners are now entering overseas market: Haier, HuaWei, Lenovo, ZTE…etc

http://www.google.com/url?sa=i&source=images&cd=&cad=rja&docid=DNzmMcY2gNytBM&tbnid=XUli0VP1Yb0M0M:&ved=0CAgQjRwwADjFAQ&url=http://www.csmonitor.com/World/Global-News/2013/0412/Good-Reads-China-s-limits-competitive-America-charitable-giving-and-New-York-childhoods&ei=NGywUdZ1iOO1BqergYgN&psig=AFQjCNEp5Akx6-4DKsJFZHcNieY9PhYYJg&ust=1370602932065535



Shanghai ‘Pearl of the Orient’

Population: 23,019,200

Area: 6,340 km2 (Urban area 2,643 km2)

Structure: Shanghai is divided into 16 districts and 3 counties. There are 205 towns, 9 townships, 99 sub-district committees, 3,278 neighborhood committees and 2,935 villagers' committees

GDP Per Capita: CNY 82,560 (USD 13,474) (2011)

Port : 29,05 million TEU (2010) (World no 1)

Highest Building: Shanghai Tower(2014), 632m (2 in World)

1990

上海



China Overview Go West -The Rise of China's 2nd and 3rd Tier Cities

1990 West – East Distance 5,000km

North – South D

istance 5,500km

Chongqing Shanghai

Beijing

Chongqing

Urumqi

Lhasa

Guangzhou

Chengdu

Tier 2 44.5% population

32% of GDP Tier 3

4.5% population 4% of GDP

Tier 1 51% population

64% of GDP


In 2009, China beat Germany for

the first time, $1.2 trillion

exports

China Logistics A few general figures

$400 billion 2 million 3PL in China

Top 6 providers; only 1% MS

6 million trucks on the local market = Avg 3

trucks / company

77,800 km of railway (3rd largest

in the world)

3,600,000 km of upgraded road (2nd largest in the world)

Logistics market was

$400 billion in 2012, with a sharp

yearly increase since

$16.3 billion investment

announced in 2013 to build a network

able to deliver everywhere in 24h


China Logistics

• China is no longer merely considered as a location with cost-saving potential, but rather a strategic mainstay from procurement (8-% already in China) to manufacturing (64%) to distribution (53%)

• Pwc “Logistics companies that think they missed their chance will find the market is still rife with opportunities”

• Outsourcing the warehousing operation is still not common: - 25% only use 3PL services – 6% only use international 3PLservices

63%

44%

28%

23%

8%

20%

36%

35%

13%

9%

27%

36%

16%

27%

9%

6%

0% 20% 40% 60% 80% 100%

Supply Chain monitoring

Warehousing

Customs clearance

Transport managementInternal

External, ChineseLogistics companies

External, non-ChineseLogistics companies2

Unknown, n/a, doesnot apply to ourcompany

Logistics market and customer habits


China Logistics

Price is not always the most important criteria to choose a 3PL provider

6%

40%

46%

46%

54%

56%

69%

76%

82%

36%

47%

41%

46%

36%

42%

29%

23%

16%

53%

12%

12%

8%

8%

2%

2%

1%

1%

5%

1%

1%

2%

0% 20% 40% 60% 80% 100%

Charitable engagement

Environment aspects/sustainability

Nearly location

Tracking & tracingsystems

Security systems

Price

Quality management

Sufficient capacity

FlexibilityHigh Average Low Unknown, n/a

Logistics market and customer habits

Having an existing facility in the right location (sufficient capacity) with a similar running experience (Flexibility + Quality management) is the winning combination


Logistics flows that DSV can serve in China

From Sourcing… • Consolidation center with

inventory • Quality control before export

…to production… • Inbound logistics for production • VAS and kitting before export

…to China domestic market • Import + Delay duty (spare

parts, industrial…) • Quick import for domestic

distribution (Retail) • China Domestic DC • Pure distribution

…and Regional DC • Pan-Asia / Global DC by sea • Pan-Asia / Global DC by air


SHA Waigaoqiao FTZ SHA Yangshan FPA DC Suzhou SIP/Wuzhong DC

Beijing Yizhuang WH Tianjin Industrial Park Wuxi Ehu DC

DSV China – Key distribution centers Warehousing I Distribution I Value Added Services

All facilities operated by DSV Staff, MHE & WMS


DSV Solutions Footprint: China

Logistics & Transport Hub Footprint

Locations Warehouse Space

Shenyang 500m2

Haerbin 500m2

Beijing 7,000m2

Tianjin 18,000m2

Suzhou 13,500m2

Wuxi 5,200m2

Shanghai 58,000m2

Fuzhou 500m2

Chengdu 200m2

Kunming 500m2

Shenzhen 20,000m2

Hong Kong 6,000m2

Total 130,200m2

Chengdu Shanghai

Shenzhen

Suzhou Wuxi

Beijing Tianjin

Shenyang

Fuzhou

HK

Harbin

Kunming

235 team members in 22 locations spread over 12 cities serving 105 customers


DSV Solutions Footprint: China

Logistics & Transport Hub Footprint

Locations Warehouse Space

Shenyang 1,000m2

Haerbin 500m2

Beijing 7,000m2

Tianjin 18,000m2

Suzhou 3,800m2

Wuxi 6,000m2

Shanghai 60,000m2

Ningbo 2,000m2

Fuzhou 500m2

Chengdu 200m2

Kunming 500m2

Guangzhou 3,000m2

Shenzhen 11,000m2

Hong Kong 6,000m2

Total 119,500m2 Transportation hub only

DSV Logistics Warehouse Site

Chengdu

Xi’an

Chongqing

Liuzhou

Shanghai

Xiamen

Shenzhen

Suzhou Wuxi

Qingdao Jinan

Beijing Tianjin

Shenyang

Fuzhou Guangzhou

Golmud

URMQ

Korla

Lanzhou

Wenzhou

Zhengzhou

HK

Harbin Qqhr

Changchun

Dalian Taiyuan

SJZ

Kunming


Case Study: Asia DC in Shanghai

Service Scope

• Danish furniture retailer with 350 stores in 50 countries, central DC in Denmark

• 13 markets in Asia & Middle East, over 20 suppliers in China + DK CDC volume



DSV Solutions

• Optimized warehouse layout re-design • Productivity improvement by both process optimisation and RF

operation implemented by Aptar and support by DSV • Performance driven bonus to improve the staff motivation and

productivity



Key benefits for the Customer

• Significant cost reduction by closing 3,000m2 JP DC in Tokyo • Significant cost savings to serve all Asian markets – more than half

of product volume manufactured in China. Lower DK CDC cost • Reduced client order fulfillment lead-time to Asian stores (excl. JP)


DSV TMS: Web base order Track & Trace tool

6

Comprehensive operation models (e.g. milk run, hub & spoke)

5

More than 500 final destinations 4 Own transport license 1

Specialized trucks available (side-wing, air-suspension, flatbed, temperature control and box truck)

3

Multi-transportation model: FTL, LTL, express courier, air and rail

2

Transport Overview

18 | DSV - Place, Month Day Year

High-Tech New Energy Retail Auto Industrial

DSV China Logistics clients

http://www.anixter.com/AXECOM/US.NSF/HomePage?OpenForm

http://www.sanan-e.com/

http://www.centralretail.com/en/index.php

http://www.daviscofoods.com/


Round tables agenda

China as a Regional Distribution Hub (Ralf and Per Sonne)

China Domestic deliveries (Ralf or Kelvin Tan)

Customs and taxation issues while importing into China (Peter Zhou)

Chinese language IT integration challenges (Group IT/ Allen/ External)

Order and stock optimization (Guillaume/ Bugaboo)

Human Resource (Rikke/ Andy)

Legal aspects of setting up and running a business in China (External expert)

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2

3

4

5

6

7


Contact Details

Thomas van Vliet Marketing Manager +31 (0)61 290 4586 [email protected]

Ralf Bekink National Business Development Manager +86 1 502 170 9896 [email protected]

Guillaume Burette GM Logistics +86 1 801 730 6366 [email protected]

Supply Chain Opportunities in China - DSV/media/NL/Images/Nieuwsbrief/Nieuwsbrief 2015 juli... ·...

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