Location, location, location: What it takes to get site selection right

Several urgent matters are solved by companies realigning their supply chain and manufacturing footprint across Asia Pacific. One is the need to stay closer to the region’s growing middle class so as to increase the chances of capturing more of the market and also to respond quickly to their evolving expectations. This isn’t just about saving on transport costs, but instead giving organisations the ability to quickly and confidently identify trends and respond. This means greater relevance leading to enhanced customer experience, sales and loyalty.

Another key driver is rising costs of labour and tightening regulations in traditional manufacturing locations, and the increasing maturity of suppliers across other parts of Asia Pacific. A rebalanced supplier and manufacturing portfolio creates resilience in supply chains. The COVID-19 pandemic was just the latest warning for business – fragile supply chains simply don’t work in an environment that experiences regular disruptions.

Footprint realignment allows a business to make a powerful strategic shift toward success. It’s a recognition of the fact that market forces always change. Successful organisations are the ones that anticipate that change.

Solving the site selection puzzle

An enormous leap is involved in getting site selection right in a new territory, but it needn’t be a leap of faith.

Local regulations, talent challenges, supplier issues, infrastructure problems, community expectations, cultural misunderstandings and much more can make the process resource intensive, prohibitively expensive, highly risky and time-consuming.

Often the difference between failure and success is process. In this case, best practice involves going beyond due diligence of a shortlist of potential locations, taking in far more detail than the organisation would in a more familiar environment.

The other vital ingredient in the recipe for success is local partnerships.

Bringing local players on board can mitigate operational risks, build essential relationships with suppliers, talent agencies and government departments, reveal previously unidentified benefits and advantages such as government incentives, and negate customs and trade perils.

The right processes and partnerships will set organisations up for the next generation of success.

Learn more about rebalanced and resilient supply chains in Asia Pacific here

Find your local Asia Pacific contact

Christopher Kelkar

PwC Asia Pacific Vice Chairman, Operations, PwC United States