What is supply chain management?

The planning and administration of acquisitions, conversion, and logistics management operations are all part of supply chain management. It also handles with the coordination of all parties (from suppliers to customers). It deals with demand management inside a corporation in this manner.

What steps can we take to identify and reduce waste in our supply chain strategy?

The first step is to examine existing processes and determine where waste is still an issue. You may, for example, compare the things you buy to your outcome to prevent expenditures. Talking to relevant managers or operators or solicit further feedback from customers or service suppliers.

What is a global supply chain?

Global supply chains are networks that cross continents and nations to source and distribute goods and services. The mobility of information and resources is one of the most important foundations.

Where do risks exist in supply chain management?

Internal risks (those under your control) and external risks (those that are beyond your control) coexist. In this regard, the following sorts of dangers are identified: Financial hazards Poor planning Regulations Environmental Socio-political Human behaviour

What is procurement in the supply chain?

One of the various branches of the supply chain is procurement. It serves as a structure for a firm to efficiently carry out all of its daily activities, monitoring the outcomes and assessing how the items that will be provided to the clients are made.

What factors contribute to the success of a supply chain?

A good supply chain must have three components: flexibility, data, and long-term planning. In this regard, some of the aspects that impact its correct operation are as follows: Maintain your adaptability. Trust data and technology Plan for the future Remember who is your end customer

What are the benefits of supply chain management?

In a nutshell, it facilitates and improves the movement of products, information, and commerce. Companies benefit from an optimised and efficient business, building better ties with partners and customers.

Why is supply chain planning so important?

Planning in the supply chain helps to simplify operations, enhance productivity, eliminate wasteful spending, and build stronger client relationships. Planning, when done effectively, may assist decrease costs associated with purchasing, manufacturing, inventory management, and transportation.

How can we gain a better understanding of our supply chain costs?

Data analysis is an excellent tool for anticipating and determining where we need to improve. For example, it assists us in optimising warehousing and storage, which is essential in a bigger supply chain strategy. This allows us to optimise space, decrease damage, reduce packing, and do a variety of other things.

What obstacles do organisations experience when attempting to improve SCM?

The supply chain is a difficult process in and of itself, and adding innovations is a problem for businesses. It's critical to move fast and to balance rising customer demand with competitive pricing. In this regard, procurement may also assist to determine whether parts of the supply chain are not competitive or to set more ambitious goals.

Beyond China: Why Manufacturers Are Looking to India for Spare Parts and Equipment Production

China has ruled world manufacturing for decades. From electronics to spare parts and heavy machinery, companies across the globe were dependent on Chinese manufacturing bases. Recently, though, economic and global disruptions have made manufacturers rethink their strategies.

Offering competitive costs, a skilled workforce, and strong government incentives, India is becoming a top choice for spare parts and equipment production. So what is it that is making India strategically appealing? From cost advantages to infrastructure growth, read ahead to learn why manufacturers are increasingly turning to India for stability and efficiency.

Understanding the Global Manufacturing Shift from China

A number of factors have driven the increasing move away from China. Although the nation is still a manufacturing giant, increasing costs and geopolitical tensions have pushed companies to seek alternatives.

Rising Labour Costs and Production Expenses in China

China's once-attractive low-cost manufacturing advantage has gradually faded. Over the past decade, wages in China have steadily increased. According to data, the average annual wage in the manufacturing sector increased on an average annual growth rate of approximately 7.5%. This substantial increase has forced manufacturers to reconsider their cost strategies, especially for price-sensitive industries like spare parts production.

Impact of Tariffs, Trade Restrictions, and Geopolitical Risks

The U.S.-China trade war, combined with rising geopolitical tensions, has introduced new threats for companies that are highly dependent on Chinese suppliers. Subsequently, some of the instant results of this trade war are increased costs of tariffs on Chinese products, and uncertain diplomatic relations.

This has furthermore added more volatility in the market. Henceforth, manufacturers are now under more pressure to diversify their supply chains to mitigate these risks.

Supply Chain Disruptions Exposing Overreliance on China

The COVID-19 pandemic unveiled weaknesses in supply chains around the world, and especially those based in China. Factory closures, material shortages, and delivery holdups exposed the risks of too much dependence on one region for production. Consequently, companies are currently searching for other locations to diversify and ensure operational continuity.

The Rise of the China Plus One (C+1) Strategy in Manufacturing

To lower risks and enhance supply chain resilience, numerous manufacturers are increasingly adopting the "China Plus One" (C+1) strategy. This strategy entails keeping some operations in China while relocating a portion of the manufacturing base to other nations.

Why Companies Are Diversifying Their Production Footprint

Risk Reduction: Relying on multiple regions helps manufacturers manage uncertainties like trade conflicts and natural disasters.
Cost Efficiency: Emerging economies offer lower production costs, improving overall profitability.
Improved Supply Chains: Diversifying ensures businesses can respond better to disruptions.

Key Factors Driving the Adoption of C+1

Geopolitical Risks: Rising tensions have encouraged businesses to expand their manufacturing footprint.
Market Access: Establishing operations in alternative regions allows companies to serve new markets more effectively.
Labour Cost Savings: Countries like India offer competitive wages without compromising workforce skill levels.
Expanding Consumer Base: India’s growing middle class and increasing demand for consumer goods offer businesses with more market opportunities.

The Role of Emerging Economies in Global Supply Chains

Rising economies such as India, Vietnam, and Indonesia are increasingly contributing to stabilizing supply chains worldwide. By providing low-cost manufacturing, expanding industrial facilities, and diversifying trade routes, these countries are minimizing dependence on China. This diversification enables companies to reduce risks while maintaining smoother operations in global markets.

Why India is the Best 'Plus One' Destination for Spare Parts & Equipment Manufacturing

These are the reasons why the country stands out as an attractive option for manufacturing spare parts and equipment:

Competitive Labour Costs and Skilled Workforce

India offers one of the most cost-effective labour markets globally, with wages much lower than China's while still maintaining a skilled and diverse workforce. Alongside, there is an abundance of engineering talent, particularly in sectors like automotive, electronics, and heavy machinery.

Government Incentives Under "Make in India" and "Atma Nirbhar Bharat"

The Indian government has introduced several initiatives to encourage local manufacturing. Under the "Make in India" and "Atma Nirbhar Bharat" (Self-Reliant India) programs, businesses benefit from:

Tax Incentives for Manufacturers
Subsidies for Infrastructure Development
Faster Approvals and Streamlined Regulatory Processes

Strengthening Infrastructure and Supply Chain Networks

India has invested heavily in upgrading its transport infrastructure, ports, and logistics networks over the last few years. Initiatives such as the Dedicated Freight Corridor (DFC) and better port connectivity have increased supply chain efficiency, positioning India as a more reliable option for mass production.

India vs. China: A Comparative Analysis for Spare Parts and Equipment Manufacturing

When comparing India to China, there are several factors that set India apart:

Cost Efficiency and Operational Flexibility

Lower Wages: Indian labour costs are generally 30-40% lower than China's.
Flexible Regulations: India has eased investment rules and reduced bureaucratic hurdles, attracting more foreign investments.

Manufacturing Quality and Innovation Capabilities

India has a number of high-quality manufacturing clusters in Pune, Chennai, and Gujarat. The nation is fast developing in precision engineering and is well suited for the production of complex spare parts.

Business Environment and Ease of Doing Business

India has moved up the Ease of Doing Business rankings of the World Bank with simplified procedures for business registration, getting licenses and permits, and cross-border trade. This improvement has enhanced investor confidence.

Overcoming Challenges: Transitioning from China to India

While India presents vast opportunities, companies must prepare strategically when shifting production. Key considerations include:

Logistics, Supplier Partnerships, and Regulatory Considerations

Supply Chain Partners: Identifying reliable suppliers in India is essential for smooth operations.
Compliance and Taxation: Understanding India's regulatory landscape ensures smoother transitions.
Logistics Management: Partnering with trusted logistics providers can improve shipping timelines and reduce delays.

Case Studies of Manufacturers Successfully Making the Move

Apple's Shift Towards India: Since 2017, Apple has been shifting the production of iPhones to India in order to curb dependence on China. Foxconn and Tata Electronics currently manufacture iPhones, such as the iPhone 16 Pro, in Tamil Nadu and Karnataka. India's share in Apple’s iPhone production is expected to grow from 15% to 25% by 2027.

Aerospace Expansion in India: Airbus and Rolls-Royce have approached Indian suppliers to manage supply chain interruptions. Bengaluru-based JJG Aero and Hical Technologies have expanded leaps and bounds, while Airbus has contracted aircraft door production to Indian companies, reflecting India's increasing position in aerospace production.

Future Outlook: The Role of India in the Evolving Global Manufacturing Landscape

India is increasingly becoming a prominent player in world manufacturing, particularly in spare parts and equipment manufacturing. With its manufacturing industry expected to expand by 8.2% per annum, India may have a market size of USD 711.35 billion by 2034. Additionally, in the electronics industry, India has set its sights on reaching $300 billion in exports and manufacturing by 2025-26.

As international companies seek stable and diversified supply chains, India's enhancing infrastructure, talent pool, and investor-friendly policies are propelling its emergence as a manufacturing giant. It is indeed a shift that's only likely to gain momentum in the coming years.

Interested in seeing how India's spare parts and equipment industry is transforming? Learn how Refteck is making innovation and efficiency a reality.

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