State of transport in textile producing countries.
Although many textile manufacturers are taking a change on Southeast Asia countries, India and Bangladesh as the new locations for their ventures, the reality is that many of these countries present limitations and weaknesses in this aspect.
Regarding this topic, the survey conducted by DHL-International Supply Chain established that the best countries in terms of logistics, transport and distribution are, in order of performance: Vietnam, India and Indonesia.
Many factors can have an effect on the logistics performance and, according to this research, we can notice several disparities when assessing country by country. For example, in Bangladesh, the nearest main port is 385 Km away from the capital city, while in Myanmar it is only 25 Km away. On the other hand, in Indonesia, the percentage of physical inspection doesn’t exceed 7%, whereas in Myanmar it covers 75%. In Bangladesh, the cost of exporting to the US is USD 602, while in Vietnam it is USD 237.
Most relevant considerations from DHL-International Supply Chain.
“Vietnam has the lowest export cost out of all the countries evaluated. Myanmar has improved its export customs process during 2013/14, and it currently boasts the fastest processing times. However, the quality of dispatch from this country has not improved yet. Indonesia keeps a high quality of dispatch and it has the lowest percentage of inspection”.
Nevertheless, these ratings don’t paint the whole picture; and that is the case of Myanmar. This country is characterized by its low performance in terms of logistics and infrastructure compared to other countries. However, Myanmar’s strategic location next to China and India, and its extremely low costs of production make it one of the most attractive countries for textile manufacturing. On the other hand, this nation is underpinning its weaknesses by expanding the airport, developing new economic areas and building new loading docks.
Although performance percentages are important, we are talking about an ongoing process where we must open our eyes wide and see beyond statistics in order to assess the whole picture.
The transport and logistics infrastructure is just as important as our provider’s industrial infrastructure. Finished goods that can’t be dispatched because of the lack of a suitable road in the event of heavy rainfall or that are blocked at customs due to bureaucratic paperwork, equals an “unfinished” production.
In this sense, China’s infrastructure and functionality is a “booster” to commercial relationships and their optimum results. I am a big fan of China in this aspect, among others; Chinese businessmen and manufacturers have been greatly benefited by the huge and versatile public infrastructure put at the service of private business.
Thank you Leonardo Stella, Commercial Desk SSA DHL Global Forwarding China Office, for forwarding me this valuable report!