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A look back at the trends and new normal of 2021

As we bid farewell to 2021, we look at the trends that have disrupted and evolved the world this past year.
A look back at the trends and new normal of 2021
31 December 2021 •

The two years since the onset of Covid-19 have rocked the global supply chain. The knock-on effects of shortages, pandemic restrictions, and bottlenecks have left few industries intact. The global economy was heavily disrupted, more so for developing countries, which have been hit the hardest, their crumbling economies reducing incomes and shortfalls in infrastructure limiting access to vaccines.

While the pandemic has presented unprecedented challenges for smaller businesses, many owners have successfully pivoted towards e-commerce to reach out to customers new and old. Digital operations are now the new normal, as online shopping sites replace brick-and-mortar stores worldwide. Such changes may outlast the pandemic.

To mark the end of this eventful year, we take a tour through our most-read stories that have resonated with you in 2021:

The trickle-down effect

According to a survey conducted in March 2021 by supply chain risk analytics platform, Everstream Analytics, professionals from various sectors report that the crisis has been extremely pervasive, affecting almost every industry across different regions (4 March 2021).

From shipping containers to computer chips, the pandemic set in motion a chain reaction that impacted numerous industries, which in turn struggled to keep business going while adapting to remote and online operations.

Confronting these challenges, some countries in the region prioritized their plans for infrastructural development, in the hope of increasing trade connectivity and smoother operations.

China, for instance, did not alter its plans for a global technology innovation center in the Greater Bay Area, with advanced manufacturing and modern services industries meant to rival that of San Francisco’s Silicon Valley (3 March 2021).

On the other hand, Taiwan faced a crisis with Chipaggedon, partly due to being caught in the tech war between China and the U.S. This trade war, combined with one of the worst droughts Taiwan has ever faced, not to mention Covid-19, severely disrupted production in the world’s chipmaking factory.

As the global chip shortage crippled other sectors, logistics partners sought to mitigate the crisis by strengthening supply chain processes, hoping to build more flexible and streamlined operations for the future (13 September 2021).

Consolidating the lessons learned throughout a chaotic pandemic-ridden year, Everstream Analytics annual report, published on 23 March 2021, detailed the emerging risks that need to be mitigated when strengthening supply chains.

Adapting to digital platforms

Soon after the onset of the global pandemic, many micro-, small- and medium-sized enterprises (MSMEs) accelerated their adoption of e-commerce in the hope of tiding their businesses through Covid-19 lockdowns.

While there were inevitable casualties, the pandemic has also acted as a catalyst for many entrepreneurs to launch or expand their businesses, pivoting towards e-commerce to reach a global audience.

For example, Hong Kong celebrity chef Grace Choy was one of many business owners to take a leap of faith and set up her private dining kitchen in Tokyo. The fruits of her labor, Choy Choy kitchen, has since been bringing authentic Cantonese cuisine to the world, including a new line of savory sauces (27 April 2021).

Traditional businesses have also changed with the times.

For over a decade, Masashi Okamoto has pioneered the digital archival and production of Japanese comics and graphic novels, also known as manga for some of the world's most successful, longest-running manga publications. Our story in October explored how the Manga-Art Heritage project has been leveraging digital tools and an international e-commerce network to mine its rich archives (11 October 2021), turning original manga illustrations into collectible art for an international market unable to visit Japan during the pandemic.

Similarly, Papa New Guinea coffee brand Banz Kofi has evolved from a passion project to a home-grown business empowering local farmers. With over 30 years of history, the single-origin specialty coffee brand has kept on grinding even during a global pandemic, leveraging its strong e-commerce platform to share the beans of their labor with coffee lovers worldwide (2 July 2021).

As the shift from brick-and-mortar stores to e-commerce becomes permanent, resilience is key for these small businesses as we are not quite out of the woods yet (25 June 2021).

The impact on developing nations

While no country has been spared, the developing nations have borne the brunt of the pandemic.

Sudan, in particular has had a turbulent year. Covid-19 has been a fresh obstacle for a country riven by decades of civil wars, floods and sanctions.

Things, however, seem to be looking up for Sudan as its removal in late 2020 from the U.S. Department of State’s list of State Sponsors of Terrorism opened up access to desperately-needed debt relief and foreign investment. After 27 years, local partnerships, a peace deal, and increased connectivity in the world are helping the country move forward to a hopeful future (8 April 2021).

But for many developing countries, a road out of the pandemic is obstructed by the struggle to obtain access to vaccinations, derailing the world’s aim of having ten billion vaccine doses rolled out by the end of 2021.

The great vaccine rollout has been set in motion, but it is happening too slowly for less-developed countries to get them back on track (11 June 2021). With the uneven distribution of vaccines and new virus strains emerging, the war against the coronavirus is far from over.

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The two years since the onset of Covid-19 have rocked the global supply chain. The knock-on effects of shortages, pandemic restrictions, and bottlenecks have left few industries intact. The global economy was heavily disrupted, more so for developing countries, which have been hit the hardest, their crumbling economies reducing incomes and shortfalls in infrastructure limiting access to vaccines.

While the pandemic has presented unprecedented challenges for smaller businesses, many owners have successfully pivoted towards e-commerce to reach out to customers new and old. Digital operations are now the new normal, as online shopping sites replace brick-and-mortar stores worldwide. Such changes may outlast the pandemic.

To mark the end of this eventful year, we take a tour through our most-read stories that have resonated with you in 2021:

The trickle-down effect

According to a survey conducted in March 2021 by supply chain risk analytics platform, Everstream Analytics, professionals from various sectors report that the crisis has been extremely pervasive, affecting almost every industry across different regions (4 March 2021).

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In a survey by supply chain risk analytics platform Everstream Analytics, supply chain professionals across different sectors and regions reveal how the pandemic has impacted their operations.

Shortly after the World Health Organization declared Covid-19 a pandemic last March, air freight rates soared to an all-time high as organizations struggled to keep supply chains operational amid sky-high costs.

The pandemic has since upended global supply chains — factories have been shut down, transportation delayed, and access to labor and component parts around the world disrupted.

One year into the pandemic, the impact on supply chains still lingers.

In a survey conducted by supply chain risk analytics platform Everstream Analytics (formerly known as Resilience360), more than 98 percent of the 195 respondents — supply chain professionals from the technology, life sciences & health care (LSHC), aerospace, consumer goods, and automotive industries, among others — stated that the pandemic affected their operations to some degree.

“The responses illustrate the all-pervasive nature of this crisis — hardly anyone has been spared from its effects. Organizations adopted diverse strategies to cope with its impact; some of these measures are likely to extend beyond the pandemic and create longer lasting changes to supply chain networks,” said Shehrina Kamal, Product Director, Intelligence Solutions, Everstream Analytics.

Supply and demand shocks have hit hard

Since the start of the pandemic, the vulnerabilities of global supply chains have been laid bare.

The most significant near-term challenge identified by the survey respondents — sudden demand shocks and surges — trigger an imbalance in the supply chain when insufficient supply leads to delays or disruptions in meeting demand.

For instance, personal protective equipment (PPE) such as surgical masks and surgical gowns were in short supply globally until companies gradually ramped up production amid lockdown restrictions worldwide. As more businesses switched to working from home, demand for consumer goods such as fitness and office equipment also increased correspondingly, causing a temporary supply shortfall.

Such spikes in demand are often further exacerbated by supply shortages for critical materials or components — the second-most significant short-term challenge voted by 97 percent of the survey respondents.

The 76-day lockdown in the Chinese city of Wuhan in early 2020 disrupted global manufacturing operations and their supply networks.
The 76-day lockdown in the Chinese city of Wuhan in early 2020 disrupted global manufacturing operations and their supply networks.

One of the most susceptible to interruptions is the automotive industry, which relies on a global network of suppliers for precision materials and components. When China entered a 76-day lockdown last January, a shortage of key parts from China forced South Korean automaker Hyundai to halt production for more than a week.

Even for well-prepared companies with strong demand planning, having a ready supply does not guarantee a smooth delivery if there are no ample freight options.

According to the Everstream Analytics survey, capacity shortages, disruptions, and restrictions across air freight (63.1 percent), ground transport (48.7 percent), and ocean freight (42.6 percent) have posed the greatest challenges on logistics operations during the pandemic.

Among the most heavily impacted was air freight, which saw widespread passenger flight cancellations due to countries’ border restrictions to limit the spread of the coronavirus. With aircraft fleets grounded, the global scheduled air cargo capacity in July 2020 shrank by a massive 70.5 percent year-over-year.

On the ground, cross-border movement restrictions such as stricter border checks and mandatory quarantines also caused a dip in haulage capacity. Meanwhile, reduced port labor due to Covid-19 restrictions, an uptick in blank sailings, and a shortage in container supply have kept ocean freight rates elevated in early 2021.

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Weighing freight alternatives: Cost vs reliability

To avoid expensive shutdowns and undelivered orders, supply chain professionals have had to improvise and respond quickly by searching for freight alternatives — at all costs, in some cases.

The Everstream Analytics survey revealed that up to 37.4 percent of organizations paid premium rates to get critical air cargo shipments uplifted in time. Others implemented less costly steps such as increasing stock inventory to pre-pandemic levels (22.6 percent), switching to multimodal services (15.4 percent) or changing freight alternatives entirely.

The frequent users of premium air cargo services include the technology (26 percent), LSHC (19.1 percent), and automotive sectors (19.1 percent), where timeliness is critical.

“For example, the automotive industry works on a just-in-time manufacturing model which requires parts to arrive at a certain time to keep operations flowing. Similarly, LSHC companies need to ensure their high-value, temperature-controlled products are not held up in bottlenecks that compromise product integrity,” said Kamal.

Some sectors have gone for speed and timeliness regardless of cost, and others opted to prioritize reliability. In particular, ocean freight is the preferred mode of transportation over air cargo that organizations will consider shifting to in the future.

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With uncertainty around air cargo capacity persisting this year amid travel restrictions, ocean freight has been widely considered a more practical and attractive option. Increasingly, carriers are offering competitive time-definite products on major trade routes, such as expedited ocean services with guaranteed equipment, by-passed congestion, and faster transit times.

Despite the record-high spot rates, shipping cargo by sea still costs less than air cargo, potentially translating into substantial cost savings in a difficult post-pandemic environment.

Rethinking supply chains

Multinational firms have also been re-assessing their supply chain networks to evaluate whether the pandemic calls for a shift in sourcing and manufacturing to other alternative markets.

Only 1.8 percent of the respondents, the majority of whom organizations have a significant presence in China, indicated that they are moving all sourcing and manufacturing activities out of China. Meanwhile, 25.5 percent have no plans to do so, and 24.7 percent plan to shift some activities to another country.

For the organizations reconsidering their supply chain strategy, 31.3 percent are doing so to diversify supply chains to reduce risks of disruptions and delays, and a further 17.9 percent are trying to reduce reliance on China, which continues to be a key source for essential materials.

Many suppliers for critical parts and components across major industries are based in China.
Many suppliers for critical parts and components across major industries are based in China.

For now, however, a mass exodus of global supply chains from China remains unlikely.

Companies will need to evaluate various factors including access to mature manufacturing facilities, warehousing availability, reliability of air, ocean, ground infrastructure and transportation routes as well as alternative suppliers and raw materials.

In addition, a higher level of risk is involved for industries that are heavily reliant on advanced technologies built or made in China. The specific skills required from a trained workforce may not be easily transferable, or readily available in other countries.

The post-pandemic transition

The highly disruptive stop-start nature of Covid-19 related restrictions will persist, but proactive measures will allow businesses to mitigate and manage the risks.

In the next six to 12 months, over half of the supply chain professionals (56.9 percent) indicated that they would implement proactive supply chain risk management processes, while 40.5 percent of the respondents stated that they would invest in technologies to improve supply chain risk monitoring.

“Using supply chain visibility and risk management tools, firms can speed up their responses during a crisis and use a data-driven approach to make decisions. The current crisis is as good a time as any to embark on the journey towards supply chain resiliency,” said Kamal.

Adopting these measures will prepare global manufacturers and supply chain professionals for further volatility as countries attempt to stem the pandemic’s spread.

Unlike natural disasters and global trade conflicts, coping with the pandemic fallout has proven to be a greater challenge. Only the most agile and responsive measures will alleviate its impact, and help supply chains to navigate the operational and business challenges ahead.

 

 

To see the full results from the Everstream Analytics survey, please visit:

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From shipping containers to computer chips, the pandemic set in motion a chain reaction that impacted numerous industries, which in turn struggled to keep business going while adapting to remote and online operations.

Confronting these challenges, some countries in the region prioritized their plans for infrastructural development, in the hope of increasing trade connectivity and smoother operations.

China, for instance, did not alter its plans for a global technology innovation center in the Greater Bay Area, with advanced manufacturing and modern services industries meant to rival that of San Francisco’s Silicon Valley (3 March 2021).

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Amidst Covid-19, China’s ambitious plan to transform its special enterprise zone into a massive business and innovation hub remain.

In recent years, China launched the world’s longest sea bridge connecting Hong Kong, Macau, and mainland China.

The Hong Kong-Zhuhai-Macau Bridge, as it is known, spans 36 kilometers and is estimated to have cost over 100 billion yuan (€12.95 billion). At least 15 years in the making, it was also one of the world’s most challenging projects in infrastructure.

In many ways, the mega bridge represents the breadth and scope of Chinese President Xi Jinping’s grand plan to turn Hong Kong, Macau, and nine southern China cities a massive economic and innovation hub.

The dream was that the Greater Bay Area would rival even San Francisco’s Silicon Valley, becoming a global technology innovation center, hosting advanced manufacturing and modern services industries.

All about connectivity

The Chinese government’s goals for the Greater Bay Area are linked heavily to its aims for improving trade connectivity with the rest of the world.

As it stands, China remains a strongly domestic-oriented economy. In the seventh edition of the annual DHL Global Connectedness Index (GCI), the country ranked 70th. Its international flows are comparatively smaller than its structural characteristics (population, GDP per capita, and geography) suggest they could be.

The new GCI report also ranks economies according to their shares in Hong Kong’s flows. Mainland China tops the list with 57 percent, followed by the United States, the United Kingdom, Singapore, and Japan. Asian neighbors Taiwan, Korea, Malaysia, Thailand, and the Philippines make up the latter half.

The GCI employs more than 3.5 million data points to track the globalization of 169 countries and territories over the period from 2001 to 2019. It measures each economy’s global connectedness based both on the size of its international flows relative to the size of its domestic activity (‘depth’) and the extent to which its international flows are distributed globally or more narrowly focused (‘breadth’).

Since deeper global connectedness is associated with faster economic growth, China has untapped potential to benefit from strengthening its connections with the rest of the world.

Infrastructure has also been a priority for the country. In Foshan, there have been new transportation hubs, and in Jiangmen and Shenzhen, investments in education to build up the necessary workforce for the GBA.”

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DHL Global Connectedness Index 2020
The DHL Global Connectedness Index measures globalization based on international flows of trade, capital, information, and people.

Hong Kong matters

As part of the Greater Bay Area, Hong Kong plays an integral part. The city ranked 25th on the GCI, ranking one notch higher than last year on both its global and regional ranks.

Hong Kong is also listed among the world’s top economies with the highest proportions of flows crossing national borders based on its depth score, calculated via the size of its international flows relative to its internal economy.

The city ranks second and is followed by Belgium, the Netherlands, and Estonia. In addition to Hong Kong’s high global and regional rankings, it also ranked first on financial freedom and third in terms of ease of doing business, which is part of the structural and policy drivers of its connectedness depth.

Chee Choong Ng, Senior Vice President, and Managing Director, DHL Express Hong Kong and Macau said: “Hong Kong International Airport (HKIA) is already connected to 220 destinations and it is the most international, most cosmopolitan, and most connected city among the GBA members.

“There are mutual benefits in Hong Kong using the GBA as its economic hinterland, with the vast land area and larger talent pool in the GBA region.

“And the other members can leverage on Hong Kong’s strengths: as an internationally recognized financial center, a cosmopolitan city, and a major logistics hub. This is really economics 101 – the Law of Comparative Advantage.”

Challenges remain

Creating an integrated bay area with a combined population of 70 million people is no easy feat. For one thing, there has to be free movement of people, money, and information.

But the GBA is still some way from emerging as an economic powerhouse.

The “soft conditions” in particular — such as harmonizing the different tax, legal, and other systems — are still lacking. These translate into different traffic laws, dual legal systems, and three separate tax regimes used by the various cities.

Guangdong Governor Ma Xingrui had said at a forum: “The rules, the processes, the soft power. We have a big gap to close. And it’s a long journey.”

Ng elaborates: “The GBA doesn’t have the common currency challenges of the European Union when the EU was first set up in 1993, but we do face the similar challenges of harmonizing two administrative systems and three customs regions.

“Free flow of talent and green lane logistics for capital and information flow is still very much work in progress.”

Another major challenge is airspace management. There are five airports in the Area and each within one hour flight time, competing for air corridor space.

However, in July last year, the Civil Aviation Authority of China committed to consolidate these airports into a single airport cluster to enhance the region’s overall airspace development.

And many believe that China can tackle these challenges, and they remain upbeat about the GBA’s prospects.

The ongoing boom in e-commerce, accelerated by Covid-19, is also a big factor.

In Guangdong, overall export numbers for the province recorded a slight growth last year, despite the dampening effects of Covid-19.

Ng added:” The surge in e-commerce, which grew in one year, in what would typically take four to six years, as a consequence of changes in buying behaviors due to Covid-19.

The surge in e-commerce, and the policies and initiatives under GBA’s ambitious plans, together will grow the economic pie for all the members in the GBA.”

Further investment

Digitalization, automation, and cloud computing have received great investments from both the public and private sectors, particularly in Dongguan, Shenzhen, and Macau.

In the case of Hong Kong, to retain its position as Asia’s leading logistics hub, Hong Kong International Airport is developing into a Three-runway System which will be commissioned in 2024 and the estimated cost is about US$18 billion (€14.8 billion).

“To take advantage of all these developments, our own DHL Central Asia Hub in Hong Kong is now undergoing expansion at an investment of €377 million, to bring it to 47 thousand square meters.

“It will be ready in 2022 to take advantage of additional capacity coming from additional landing slots with the completion of the Three-runway System at HKIA in 2024. We are all set for an exciting growth story!”

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On the other hand, Taiwan faced a crisis with Chipaggedon, partly due to being caught in the tech war between China and the U.S. This trade war, combined with one of the worst droughts Taiwan has ever faced, not to mention Covid-19, severely disrupted production in the world’s chipmaking factory.

As the global chip shortage crippled other sectors, logistics partners sought to mitigate the crisis by strengthening supply chain processes, hoping to build more flexible and streamlined operations for the future (13 September 2021).

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Semiconductors are the lifeblood of the modern world, but now there is a critical shortage worldwide and Taiwan is at the center of it.

In May, Japanese automobile giant Nissan was forced to put the brakes on its vehicle production and cut its manufacturing output for 2021 by 500,000 units. The reason: a severe shortfall of a coin-sized computer chip needed to power its vehicles.

This chip shortage, which has crippled the global automobile industry for the past 18 months, has now spilled over to other sectors. But effort and flexibility among logistics partners are helping to mitigate the crisis and offer ideas for how processes might be improved in the future.

Chips, also known as semiconductors, power the modern world. Almost anything electronic, from phones, cars to even an alarm clock, relies on these nano-sized silicon wafers to function. Last year, Taiwan dominated the global market share for semiconductor contract manufacturing, accounting for more than 60 percent of global revenue.

“We’re the world’s chipmaking factory. Semiconductor manufacturing is one of the most important industries for Taiwan,” said DJ Shieh, Managing Director of DHL Supply Chain Taiwan.

But in the past year, a global pandemic and one of the worst droughts in half a century has severely disrupted production there. Taiwan is also caught in a global tech war between the United States and China. The triple threat has led to a semiconductor shortage crisis so severe that it has been dubbed “Chipaggedon”.

“The global chip shortage is affecting every industry. I think very few players expected the sharp fall in supply,” said Shieh.

“We’re doing our best to ensure the seamless flow of goods for our semiconductor customers to minimize the fallout, and hopefully resolve, this supply chain crisis.”

A perfect storm

The Covid-19 pandemic was the catalyst for this global shortage — the virus first forced semiconductor factories worldwide to shut down temporarily last year. Since then, it has continued to cause intermittent disruptions. For example, the fresh wave of Covid-19 cases that hit Taiwan in mid-2021 impacted its production capacity of many of its manufacturing firms.

“Some production makers were forced to shut down for two to three days to clean up, disinfect their factories, and conduct Covid-19 testing for its workers,” said Shieh.

Taiwan was hit with one of its worst droughts in 56 years.
Earlier this year, Taiwan was hit with one of its worst droughts in 56 years. (Photo: Shutterstock)

In June, King Yuan Electronics, one of the world’s largest chip-testing companies, saw an outbreak of cases that forced a 48-hour suspension of operations. The disruption was estimated to have slashed the company’s production by at least a third for that month.

Although production in most factories has gradually resumed, it is still being hampered by the need for stringent mass testing and quarantine measures. Delays are expected to continue.

This year, Taiwan was also hit with one of its worst droughts in 56 years, an event Shieh described as one of the “biggest concerns” for chip manufacturers.  The calamity posed a huge threat to the chip-making industry, which needs large amounts of water for its production process.

But the situation is likely to ease up. Although the government had to cut water supplies to some chip makers by 15 percent, top-tier manufacturers were less affected.

Mother Nature also provided a timely intervention. “The heavy rains and typhoon that came during the middle of this year also improved the situation,” added Shieh.

Politics, however, has also conspired to create further obstacles. The tech war raging between the U.S. and China has also contributed to an increasingly fragmented global chip supply. Sanctions imposed by the U.S. mean that chipmakers can no longer freely supply their products to any companies, as licenses and government approval are now required.

This has brought uncertainty to the global chip industry as it has led to companies placing double bookings — reservations made to ensure a safety net — which has further exacerbated the shortage.

Strengthening the supply chain

The impact has been immediate. Chip prices have risen with consumers feeling the pinch. Computers, tablets and even smart televisions have seen prices soar by as much as 30 percent.

Governments are quickly responding by ramping up chip capacity, led by South Korea, U.S. and the European Union. But the new factories will take years to come online.

“To cope with the shortage, companies are removing double bookings and channeling supplies to those who need the chips most. This way, they can filter out some of the customers who just want to do safety bookings,” said Shieh.

The global chip shortage is affecting every industry.
The global chip shortage is affecting every industry. (Photo: Shutterstock)

Logistics also has a key part to play in ensuring that the chips get to their destination quickly and seamlessly. This will help alleviate any potential delays or chokepoints.

For instance, dealing with the shortage has required flexibility in helping customers cope with the surging demand. “Besides ensuring our quality of service, we also have to be quick to adapt and accommodate to ad-hoc requests, such as providing additional storage space for incoming tools and parts for our customers,” said Shieh.

It is also extending additional services to ensure that supplies are quickly shipped out. DHL deploys material handlers at their customers’ production plants in Taiwan to manage the sensitive tools and machines needed to manufacture these chips. This ensures smooth delivery and functioning of the machines, added Shieh.

The logistics provider also offers cleanrooms and clean benches for cleaning of tools and parts to ensure that the components remain in pristine conditions. Even the smallest speck of dust can destroy an entire chip.

Aware that manpower is a big challenge for the industry, Shieh believes automation and management software solutions will boost the efficiency and speed of current operations, ranging from transport to assembly.

“If we can do more development on our software and improve our transportation management system, it can definitely make us more competitive,” said Shieh, adding that manufacturers can also do more to predict future demand and make better production forecasts.

The global chip shortage is unlikely to be resolved any time soon but any help to ease bottlenecks, speed up delivery, and smoothen deliveries will go a long way to overcoming the difficult situation.

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Consolidating the lessons learned throughout a chaotic pandemic-ridden year, Everstream Analytics annual report, published on 23 March 2021, detailed the emerging risks that need to be mitigated when strengthening supply chains.

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After a turbulent year of Covid-19, supply chains need to quickly mitigate the emerging risks highlighted in the latest report by supply chain risk analytics platform Everstream Analytics.

In its initial months, the coronavirus crisis severely disrupted the movement of people and goods worldwide, upending entire supply chains. Manufacturing operations came to a standstill as most countries implemented lockdowns to curb the spread of Covid-19.

Although most have since found ways to cope with the unending pandemic’s fallout, operational disruptions have hamstrung global supply chains. Containment measures, infection outbreaks, labor unavailability, and component shortages continue to be a drag on business operations.

“The past 12 months have shown us how maintaining resiliency and building agility into our supply chains can help mitigate the impact of a global pandemic. All parts of the supply chain must come together to orchestrate the smooth planning and execution of operations,” said Shehrina Kamal, Global Head of Intelligence Solutions, Everstream Analytics (formerly Resilience360).

“For instance, when lockdowns are lifted and suppliers resume operations, transportation capacity needs to be ready to move those supplies inbound to manufacturing and further on. To do so, organizations must establish better collaboration and coordination, enabled by technology, to move quickly when the need arises,” she added.

This year, the crisis is likely to further influence supply chain and logistics decision-making for companies finding ways to mitigate the risk of disruptions.

Here are five key supply chain trends — identified in Everstream Analytics’ Annual Risk Report 2021 — that deserve particular attention in the next 12 months.

 

To download the full report, please visit:

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Everstream Analytics Annual Risk Report 2021
How has the supply chain risk landscape evolved over the past year, and what are the top risk trends that supply chains should be aware of?

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Adapting to digital platforms

Soon after the onset of the global pandemic, many micro-, small- and medium-sized enterprises (MSMEs) accelerated their adoption of e-commerce in the hope of tiding their businesses through Covid-19 lockdowns.

While there were inevitable casualties, the pandemic has also acted as a catalyst for many entrepreneurs to launch or expand their businesses, pivoting towards e-commerce to reach a global audience.

For example, Hong Kong celebrity chef Grace Choy was one of many business owners to take a leap of faith and set up her private dining kitchen in Tokyo. The fruits of her labor, Choy Choy kitchen, has since been bringing authentic Cantonese cuisine to the world, including a new line of savory sauces (27 April 2021).

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In pursuit of culinary excellence, celebrity chef Grace Choy is tapping on the power of reinvention and efficient logistics to connect the world through food.

The cosmopolitan hub that is Tokyo, Japan is a distance from Hong Kong both geographically and culturally. Yet, when Hong Kong-born chef Grace Choy decided to set up a private dining kitchen overseas in 2019, she knew right away that it was the ideal location.

“My husband and I love Japan, and I have always wanted to cook with the freshest Japanese ingredients. When the chance came along to bring our food here, I couldn’t say no,” she said.

Located in Aobadai, Meguro City today, Choy Choy Kitchen has helped to redefine Cantonese cuisine in Tokyo. The passionate chef made it her priority to bring authentic Chinese recipes to the city’s buzzing dining scene and discerning customers.

Catering to international tastes with fresh local ingredients

Once settled, the ever-dynamic Choy also embarked on a new project — a line of mouth-watering sauces made with locally sourced ingredients. Venturing into the new space of doing business, Choy continues to reinforce one of her key beliefs: when it comes to food, there are no borders.

Choy Choy XO Sauce Bottle

“XO sauce, which is very popular in Hong Kong, was our first product and we have received so much positive feedback,” she said. “As a chef, one of the most important things is to stay true to your roots and create things that are close to your heart. At the same time, always be open to new opportunities to develop your craft.”

Though she had started out mainly shipping her sauces to Hong Kong in late 2020, Choy’s throngs of social media followers have reached out to her, asking for her to deliver to the likes of Taiwan, Australia, and even the U.S. and Canada. Working closely with DHL around import regulations for food items which vary per country, the entrepreneur was able to properly pack and dispatch her first shipments with ease. Hong Kong, for example, encourages food importers to obtain health certificates from countries of origin and has specific legal requirements or administrative arrangements for perishables.

A local operations team further collaborated with the chef for same-day pick-up to ensure buyers received the sauce at its freshest.

Chef Grace Choy in kitchen

“For our first shipments to Hong Kong, I was impressed by the team at DHL who provided seamless, 24-hour services. When the time comes to ship to many more countries worldwide, I’ll definitely be needing their support once more,” predicted Choy, who has also since delved into the development of a new product — a garlic, black bean sauce — that will be backed by a crowd-funding campaign.

From the home kitchen to social media fame

Looking back on her journey reminds Choy of how she has gotten to where she is today. While most 12-year-olds would have preferred to spend their time watching television or hanging out with their friends, Choy found solace in the family kitchen.

Peering intently at her mother’s every move, Choy recalls being mesmerized by her Cantonese recipes and cooking techniques. From the sight of dim sum simmering away in rustic bamboo steamers to the smell of freshly ground spices being sautéed in the kitchen – everything felt like magic.

Grace Choy Chef at work

“I have never received much formal training at culinary schools,” said Choy. “My mother was a great cook and today, my mother-in-law also shares my passion for food and inspires my work.”

Over time, this passion would only intensify. Despite starting out with a corporate career that spanned years, Choy eventually decided to start afresh and pursue her lifelong dream of becoming a chef. In 2011, with support from her husband, she took the bold step of setting up Choy Choy’s Kitchen Hong Kong, a private dining-style restaurant in the small town of Yuen Long.

This leap of faith would propel her to heights she never imagined possible. Choy Choy’s Kitchen Hong Kong was recognized by CNN in 2016 as one of the top 10 best hidden private kitchens in Hong Kong, as Choy became a household name. The restaurant also garnered accolades such as the most-liked Chinese restaurant on Facebook, while she became the first Twitter-verified chef from Greater China.

For Choy, staying at the top of the culinary world means having the courage to experiment and push the boundaries of age-old traditions.

“The key is never stop learning and opening yourself up to new possibilities – that’s where the magic happens.”

Useful Express shipping tips for food items

  1. Ensure liquids are contained in leak-free containers and protected with strong materials like Styrofoam. Seal in a plastic bag before packing items in a strong double wall box.
  2. Seal semi-liquids, greasy or strong-smelling substances with adhesive tape. Wrap in grease-resistant paper before packing into a strong double wall box.
  3. Powders and fine grains should be placed in strong plastic bags, securely sealed and then packed in a rigid fiberboard box.
  4. When it comes to food, freshness is key. Take advantage of DHL’s global specialist network to get to know the customs regulations of each destination country, transit times and potential temperature fluctuations throughout transport.
  5. Give your buyers greater peace of mind and control over their purchase by offering On-demand Delivery on your online platform.

Looking to take your brand global? Speak to a DHL Express specialist today.

A taste of success

This drive to reinvent herself was what inspired Choy to take the next step in her career – becoming a businesswoman. In the last quarter of 2020, after six months of research and development, she was finally ready to unveil her line of condiments to the world.

The XO sauce, made to order with Japanese ingredients and no preservatives, quickly became a bestseller. The sauce, brewed by hand from dried scallops and shrimps, boasts a rich savory flavor with a spicy kick.

“Doing business internationally was something I dared not dream about,” she said.

Choy Choy Kitchen Japan

“I thought that DHL served only the big companies and not small businesses. But with the help of DHL, a business like mine can expand internationally. It was really about finding the right support, and this has been such a big factor in making my dreams possible.”

Tony Khan, President and Representative Director of DHL Express Japan, said: “After living in the culinary haven that is Asia for a long time, I think the great food we have here deserves to be shared widely. We want to support the small businesses like Grace’s that create these good things in life by helping them reach out to opportunities in the global marketplace.”

For now, Choy is back at the drawing board, experimenting with more products.

“My goal has always remained the same — to connect the world through food. I am so grateful for the opportunity to pursue my dreams,” she said.

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Traditional businesses have also changed with the times.

For over a decade, Masashi Okamoto has pioneered the digital archival and production of Japanese comics and graphic novels, also known as manga for some of the world’s most successful, longest-running manga publications. Our story in October explored how the Manga-Art Heritage project has been leveraging digital tools and an international e-commerce network to mine its rich archives (11 October 2021), turning original manga illustrations into collectible art for an international market unable to visit Japan during the pandemic.

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Japan’s manga is massively popular overseas, but getting the artwork safely to fans required some original thinking.

Image: “Innocent Rouge” ©2021, Shin-ichi Sakamoto / Shueisha Inc. All rights reserved.


Earlier this year, the manga-inspired film Demon Slayer broke U.S. box office records for foreign language films, opening to USD20 million (€16.9 million) in sales. In 2019, the British Museum held perhaps the largest manga exhibition outside of Japan, attracting 180,000 visitors, many of whom belonged to a new, younger demographic.

Despite being a global phenomenon, manga (Japanese comics or graphic novels) has gained relatively little recognition in the entertainment industry, much less in the art world. However, with the launch of the first-of-its-kind Shueisha Manga-Art Heritage project, all that looks set to change.

The project is the brainchild of Masashi Okamoto, who leads Japanese publisher Shueisha’s digital business division. For over a decade, Okamoto has pioneered the digital archival and production of manga for well-known titles and Shonen Jump, one of the longest-running and most successful manga publications in the world.

Now, the Manga-Art Heritage project is mining its rich archives to turn original manga illustrations into collectible art, leveraging a host of digital tools and an international e-commerce network.

“We created our archive with the objective to preserve original manga art, but I (didn’t) want to just digitize it and be done with it,” said Okamoto. “I want to pass on the comics and the creations of the artists through different experiences.”

Shueisha Heritage Manga Okamoto

A new chapter for manga

 Original manga illustrations, submitted under tight deadlines to be printed in the millions, are not made to last. Yet, artists pour their heart into every page, breathing life into stories with intricate drawings. It is an art not lost on countless manga fans around the world, including Okamoto himself.

Over the years, increasingly advanced digital capture technology made it possible to preserve original artworks in fuller detail. Through Okamoto’s heritage project, Shueisha will work directly with artists to reprint their original illustrations with light-resistant, pigmented ink on museum-quality 100% cotton paper. But that’s just the beginning.

“I believe quality printing brings out the hidden details in the works otherwise wasted in digital publishing,” said Okamoto. “You just can’t appreciate the artists’ detail, skill and enthusiasm through a smartphone screen. Furthermore, capturing key scenes from manga stories freezes them in time and gives fans a new experience to fully appreciate artists’ detailed work.”

Shueisha Manga Art One Piece
“ONE PIECE” ©2021, Eiichiro Oda / Shueisha Inc. All rights reserved.

Collaboration with the right partners key to success

Venturing into the art world, Okamoto knew he needed the right partners to make his project a success. The project lead consulted with Tai Iguchi, CEO and founder of TRiCERA, an online contemporary art marketplace, to gain insight into setting up an e-commerce platform and distribution network.

One of Okamoto’s pertinent concerns was ensuring that the project’s prints could be verified as valuable original artworks. Only five to 20 copies of each manga art piece produced by the Shueisha Manga-Art heritage project are made available to buyers. To ensure their authenticity, the pieces are certified using blockchain technology by Startbahn that records the pieces’ history and ownership information.

Shueisha Manga Tricera Partnership
Tai Iguchi, CEO of TRiCERA (left) with Masashi Okamoto (right), project director of the Shueisha Manga-Art Heritage project.

The next link in the chain was a reliable logistics partner.

“In the art business, logistics is key,” said Iguchi. “With TRiCERA, we wanted to create a marketplace where everyone can buy art from anywhere. DHL’s global network and service quality made it the ideal partner for our business. Many of our buyers specifically requested delivering their orders with DHL.”

For Okamoto, it was a keen understanding of the nature of his products that helped him decide on a transport partner.

“These pieces are valued around JP¥200,000-500,000 (up to around €4,000) each and only a fixed number will be printed,” he said. “DHL gave us timely advice, from customs regulations to packaging tips. It was very assuring and even helped us to save our own resources on customer support.”

Hiroshi Kida, Major Account Manager at DHL Express Japan worked closely with the Shueisha team, advising on suitable packaging and customs regulations for the specialty items.

Shueisha Manga Art Heritage Packaging

According to Kida, auto-sorting operations often dent box corners, while customs inspections can cause damage if boxes are difficult to open up. Hence, the team designed a strong yet simple package that would weather these transport processes.

“On demand delivery, which allows for personalized shipment scheduling and secure collection options, also benefits shippers transporting high-value items like art work,” Kida noted.

Art and cultural items often face customs regulations unique to each country. For example, importing original works of art into the U.S. is generally duty-free. However, importers need to fill different forms if the item’s value exceeds US$2500 (€2111.40).

As such, logistics partners play an important advisory role to ensure e-commerce shipments — especially valuable items like art — face minimal roadblocks in transit.

“I am heartened to see businesses finding new markets and opportunities even in a volatile landscape. We aim to do all we can to minimize logistics challenges as shippers work their way through these game-changing times,” said Tony Khan, President and Representative Director of DHL Express Japan.

E-commerce a vital lifeline for emerging artists around the world

Founded by CEO Tai Iguchi, TRiCERA has grown from supporting emerging Japanese artists to stocking over 30,000 artworks by artists from all over the world.

“Art is a competitive market but what drives us is our purpose to help young artists get discovered and get their work sold through our platform,” said Iguchi. The former child actor empathized with the challenges faced by aspiring artists and quit a corporate job to start his business.

“In the beginning I would drive to studios around Japan to discover artists myself. These days we get hundreds of applicants a week. When artworks get sold, we send a logistics team from DHL to pick up the pieces from artists’ studios and deliver them directly to buyers, no matter where they are in the world,” said Iguchi. “I firmly believe that creativity knows no borders.”

Beneath Okamoto’s artistic venture lies a deeper purpose. The director hopes that his project will help create more opportunities for manga artists in an increasingly competitive space.

“Today, we print close to new 1,000 comic books annually. Manga artists face stiff competition in pursuit of their passion. That is why it’s important to create more opportunities in this industry,” said Okamoto, who plans to channel proceeds from the Manga-Art Heritage project towards supporting emerging artists.

“If we can successfully help artists to use their original illustrations as valuable works of art, they may be able to see different possibilities.”

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Similarly, Papa New Guinea coffee brand Banz Kofi has evolved from a passion project to a home-grown business empowering local farmers. With over 30 years of history, the single-origin specialty coffee brand has kept on grinding even during a global pandemic, leveraging its strong e-commerce platform to share the beans of their labor with coffee lovers worldwide (2 July 2021).

As the shift from brick-and-mortar stores to e-commerce becomes permanent, resilience is key for these small businesses as we are not quite out of the woods yet (25 June 2021).

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The man behind specialty coffee producer Banz Kofi spills the beans on staying true to his craft and community while breaking new ground in specialty coffee.

In the quaint villages sprawled across the lush Waghi Valley highlands in Papua New Guinea, thousands of locals line up by the roadside to auction off their home-grown coffee cherries. Only the cream of the crop is bought by Banz Kofi, a local coffee business on a mission to empower farmers and share the taste of their hard work with coffee lovers worldwide.

“You’ve got villagers picking their own coffee and auctioning it off to the highest bidder. Now that’s quite unheard of elsewhere in the world,” explained Patrick Killoran, hobbyist turned business owner and founder of the specialty coffee brand.

In the midst of a global pandemic, Banz Kofi has kept on grinding. Its e-commerce platform and a strong partnership with DHL Express has kept the brand’s products traveling from the remote Mount Hagen highlands across the world in a matter of days.

It all began with Killoran’s love of the local product. Having first discovered and immersed himself in the Highlands’ coffee scene, Killoran began sharing his hand-picked coffee hauls with friends and family. Banz Kofi was established in 1990 as a coffee cherry and parchment company producing green beans, before evolving into a coffee roaster in 2010.

Parchment coffee is an intermediate stage in coffee bean processing after removing the pulp of the coffee cherry. Further removing the coffee parchment layer produces green beans, which are then ready to roast.

Tree to roast Banz Kofi Mount Hagen
From tree to roast (Photo: Banz Kofi)

Respecting tradition to ensure quality and fair trade

As he built stronger ties with the community, Killoran’s vision soon turned more strongly towards supporting local growers. “Since commercial plantations slowly disappeared by the 1980s, selling their home-grown coffee roadside has been the way of life for locals who might own anything from a couple of coffee trees to several hectares of land,” he said.

“It’s mostly smallholder coffee. In the highlands, coffee is the biggest source of income for the population,” said Killoran. Papua New Guinea’s coffee industry involves roughly three million citizens— about a third of the population of the island nation.

“I think the less people involved in the supply chain the better for the farmers, hence they will get the full returns of their work,” Killoran added. “Down-stream manufacturing has to be the future for Papua New Guinea.”

Waghi Valley Mount Hagen coffee
Waghi Valley in the Mount Hagen area where Banz Kofi operates (Photo: Banz Kofi)

“Typically, you’d sell to exporters, who would sell to importers, followed by wholesalers, green bean traders, and finally roasters. By then, your coffee has gone through about 10 pairs of hands. My idea was to take that raw coffee and roast it right here,” he said.

Unlike mass-produced coffee, Banz Kofi supports only local farmers who do not use chemical fertilizers and pesticides that threaten natural ecosystems. “We begin with the local women hand-picking the best coffee cherries in the Western Highlands and Jiwaka Provinces, where the beans are grown and cultivated at high altitudes over 4,000 feet, under ideal temperatures, humidity, rainfall levels and in the perfect soil,” explained Killoran.

Papua New Guinea coffee farmers
Ripe coffee cherries being picked (Photo: Banz Kofi)

The coffee beans are then processed, roasted on demand and packed at the Banz Kofi factory located in the Western Highlands Province of Papua New Guinea. Killoran even hinted at a secret recipe for roasting the beans to perfection.

The goal, according to the founder, was this: “Because our coffee is single-origin organic and hand-picked, we have full control. The idea is that if you had a cup of Banz Kofi coffee today and again in 10 years, it would be the same — day in, day out. And our customers have come to expect that level of quality.”

Sundried and Hand Sorted coffee beans
In the process of sun-drying and hand sorting (Photos: Banz Kofi)

Growing into a global seller of specialty coffee

While insisting on traditional methods of picking their premium Arabica beans, Killoran’s less traditional business model energized Banz Kofi’s growth. Leveraging the speed of express logistics, Banz Kofi freshly roasts its hand-selected beans on demand, shipping them to coffee lovers worldwide in just a few days to brew up a fresh cuppa.

With the global pandemic driving consumers online and a growing taste for ethically sourced coffee, Banz Kofi’s unique selling point seems right on point.

“Getting freshly roasted coffee around the world in the ideal amount of time (4-5 days) would not be possible without DHL Express’ very efficent and cost effective air freight network,” said Killoran.

“Our record is that we had coffee go from Mount Hagen, in the middle of the Papua New Guinea Highlands to Tallinn, Estonia in three days,” said Killoran. The founder noted that integrating their website with Shopify and DHL has allowed Banz Kofi’s products to reach international consumers at lightning speed, and at cheaper rates than they can buy specialty coffee locally.

Even in Victoria, Australia, where there was a complete shutdown for Covid-19, Banz Kofi still managed to deliver its coffee to customers within four to five days, according to Killoran.

Tallin Estonia Fresh Roasted delivered DHL
From Mount Hagen to Banz Kofi lovers in Tallin Estonia in three days (Photos: Banz Kofi)

“Papua New Guinea’s small-to-medium enterprises, like Banz Kofi, are the future,” said Cameron Taylor, Country Manager of DHL Express Papua New Guinea, himself a self-professed fan of the brand’s specialty coffee.

“As a global logistics provider, we’re committed to nurturing and supporting local businesses to grow from start-ups operating in remote parts of the country into successful global business,” Taylor added.

To achieve this, DHL Express has been equipping Papua New Guinea’s small businesses with web development support, online shipping tools like MyDHL+, and cost-effective freight rates. Helping to integrate shipping information onto e-commerce websites has improved transparency for online buyers. On the ground, the logistics provider traverses the island with a reliable network of service locations, as well as a schedule of up to 10 flights a week from Singapore and Brisbane even throughout the pandemic.

“Though trade volume from countries like Papua New Guinea may be smaller, goods are high quality and exotic with many brands being shared simply through word of mouth. Business owners like Patrick are not only supporting the local community, but are also showcasing what this incredible country has to offer on a global stage,” added Taylor.

True to the quality of its brew, Banz Kofi has built a loyal customer base all over the world from Europe to Asia, from North America to the Pacific Islands. They are also the only Papua New Guinean coffee roaster with a HACCP Australia (Hazard Analysis and Critical Control Points) and food safety certification from the United States Food and Drug Administration (FDA), which is required for Banz Kofi to ship its coffee products to the U.S. The brand’s beans have even made the long-haul trip to the White House.

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For this recognition and for helping Banz Kofi to gaining exposure through international trade shows, Killoran credits entities like the Australian Agency for International Development (AusAID), Pacific Trade Invest (PTI), and the Pacific Horticultural and Agricultural Market Access (PHAMA) Plus Program.

Sowing the seeds of sustainability

Banz Kofi advocates sustainability through its ethical coffee-farming methods and the use of HACCP certified packaging. The brand also uses fully biodegradable Nespresso©-style pod capsules.

Mount Hagen traditional tribes
Papua New Guinea’s highlands are home to traditional tribes seeking to protect the island’s cultural diversity. (Photo: Shutterstock)

“Over ninety percent of the people we employ are Papua New Guinean women from the local community,” said Killoran. “We run a coffee shop called the Kofi Kave that only employs women who, for various reasons, find it difficult to be employed elsewhere. Many of them didn’t finish school or have few marketable skills, so we hire and train them, hoping they can move on to better employment in the future.”

By doing so, the company is helping to tackle the gender employment imbalance in the community. And as Banz Kofi continues to expand, more women and local farmers will benefit from its success.

From a DHL perspective, “seeing Banz Kofi helping the growers and pickers in the community, putting their children through school and stabilizing families with employment opportunities — these positive outcomes are exactly what our purpose of connecting people and improving lives is all about,” said Taylor.

The next frontier for Banz Kofi, said its founder, is to strengthen its Internet presence. “We want to use all the tools we can to get our brand out there,” Killoran said.

“If we can do that, I’m really confident that we can achieve some great things together.”

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Embracing e-commerce at the onset of the pandemic helped MSMEs pull through the crisis, but more needs to be done to sustain growth in the long term.

In traditional businesses across different sectors, e-commerce has often been regarded as the ‘up-and-coming’, or ‘the next big thing’, seldom assuming the lead role as a company’s main retail channel.

For many such companies, the shift to e-commerce has always been met with resistance for reasons such as legacy processes or traditional mindsets, at least until the Covid-19 pandemic hit.

The global crisis turned the tide against these businesses, from multinationals to micro-, small and medium-sized enterprises (MSMEs), who found themselves racing against time to digitize their operations — only because this time, it was necessary.

Lockdowns swept across Southeast Asia (SEA), which has largely kept the pandemic under control, albeit with occasional surges in new cases. With control measures limiting movements, consumers have naturally turned to e-commerce in droves to fulfill basic needs such as shopping for daily necessities.

The pandemic has single-handedly turbo-charged a major shift from brick-and-mortar retail to e-commerce, and we were at the forefront witnessing this transformation in action. In this article, I will share more about the important lessons for MSMEs to take on board to flourish.

A worker cleaning Kuala Lumpur’s empty streets during Malaysia’s Movement Control Order (MCO) lockdown last year
A worker cleaning Kuala Lumpur’s empty streets during Malaysia’s Movement Control Order (MCO) lockdown last year

At the peak of the pandemic in the second quarter last year, we saw a near-immediate 40 to 60 percent growth in our volumes from key Southeast Asia markets.

Key to driving this growth were MSMEs, which account for more than 90 percent of establishments in the Association of Southeast Asian Nations (ASEAN) and contribute to 30 to 53 percent of the region’s GDP.

It is abundantly clear just how enormous the potential is for MSMEs to grow in the highly attractive region, where e-commerce gross merchandise volume (GMV) is expected to reach US$172 billion (€141 billion) by 2025.

While major marketplaces like Lazada and Shopee take the lion’s share of e-commerce revenue, MSMEs can still tap into a burgeoning population of digitally savvy users who have adopted and will continue using e-commerce as their go-to channel for purchases.

Success beyond Covid-19

Those who have embraced digitalization and e-commerce are reaping the rewards. A recent study showed that two in five small and medium-sized enterprises (SMEs) that implemented digitalization initiatives in 2020 had stronger revenue growth than non-adopters.

Few would argue that the benefits of e-commerce far outweigh the risks. But for MSMEs to succeed in the long run, they have to be resilient.

E-commerce is a fast-moving, cut-throat sector where new trends are bound to emerge, and new competitors will eventually join the fray. Without improvements or new offerings, staying competitive or even surviving in the marketplace will be a tough endeavor.

With chatbots, businesses can provide 24/7 customer support.
With chatbots, businesses can provide 24/7 customer support.

For MSMEs running e-commerce sites, developing the digital infrastructure by adopting new technologies is perhaps the easiest way to offer customers an improved online shopping experience. New tools such as chatbots and live chats allow MSMEs to better interact with their customers, adding a touch of personalization while increasing efficiency when dealing with large transaction volumes.

Having an automated chatbot to handle incoming customer support queries will allow quick resolution to simple problems, making it an ideal setup for MSMEs rather than setting up a labor-intensive and costly call center from scratch.

Realistically, MSMEs do not have to be the first to jump on the bandwagon for latest technological upgrades. They can simply follow the lead of larger players who have successfully implemented these changes, before evaluating which best practices to learn from and emulate.

Back to basics

At the heart of these improvements is the desire to offer a more seamless customer experience. Often, this boils down to the basics.

Whether it is planning for a complete digital transformation, adding new features, or just a regular refreshing of the website, MSMEs have to ask themselves tough questions on how it improves the overall customer experience to address the fundamentals of their product offering.

Is there room to improve the site’s navigation and user experience? Could there be an extra button, or could a page be designed better by including a shortcut? Would offering more e-wallets and payment methods make it more convenient for our customers?

Constantly challenging the status quo can keep MSMEs competitive and help build stronger affinity with loyal customers.

According to a DHL Express B2B e-commerce whitepaper, B2B e-commerce businesses are following online retail platforms in providing multiple delivery options to meet different cost, transit time and/or service requirements.

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This comes as no surprise. Customers, regardless of sectors, expect robust logistics solutions that support their evolving growth needs, be it for domestic or international deliveries. With 11 markets and a population of 655 million, SEA itself is a massive region to cover.

At some point, MSMEs will likely also venture further in their next stage of growth and we have to be ready for that. Besides supporting our customers with the right solutions, we also constantly keep tabs on the latest e-commerce developments across the region so we can provide them with accurate, timely updates.

The regulatory environment, in particular, can be a potential minefield to navigate. It is imperative that MSMEs stay abreast of the legal and regulatory framework governing e-commerce transactions to avoid running afoul of the law while juggling their plans for growth.

For instance, new business regulations in ASEAN economies such as Indonesia, Vietnam and Cambodia have been enacted to regulate competition in the domestic markets from both local and foreign businesses. Other cybersecurity laws that restrict data flow across borders also present obstacles for businesses looking to expand their international footprint.

Embracing e-commerce may have been a significant step for MSMEs amid the pandemic, but sustaining their growth — and building on it — will truly prove their mettle.

One thing is for sure though: MSMEs will continue to remain a critical node to the economy. And as a global logistics provider, we will do our utmost as a reliable partner empowering them to succeed.

 

This article was done in conjunction with United Nations’ Micro-, Small and Medium-sized Enterprises Day to raise public awareness of MSMEs’ contribution to sustainable development and the global economy.

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The impact on developing nations

While no country has been spared, the developing nations have borne the brunt of the pandemic.

Sudan, in particular has had a turbulent year. Covid-19 has been a fresh obstacle for a country riven by decades of civil wars, floods and sanctions.

Things, however, seem to be looking up for Sudan as its removal in late 2020 from the U.S. Department of State’s list of State Sponsors of Terrorism opened up access to desperately-needed debt relief and foreign investment. After 27 years, local partnerships, a peace deal, and increased connectivity in the world are helping the country move forward to a hopeful future (8 April 2021).

But for many developing countries, a road out of the pandemic is obstructed by the struggle to obtain access to vaccinations, derailing the world’s aim of having ten billion vaccine doses rolled out by the end of 2021.

The great vaccine rollout has been set in motion, but it is happening too slowly for less-developed countries to get them back on track (11 June 2021). With the uneven distribution of vaccines and new virus strains emerging, the war against the coronavirus is far from over.

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Civil wars, floods, sanctions, and the Covid-19 pandemic may have stalled Sudan’s economy, but a new era of change is helping the country move forward.

After years of war and conflict, floods have threatened to bring famine to Sudan’s Blue Nile State, nearly 600 kilometers south-east of the capital Khartoum. In 2020, a wetter-than-usual rainy season caused the Nile River and its tributaries to reach their highest levels in almost 100 years.

According to a report by the United Nations Office for the Coordination of Humanitarian Affairs (OCHA), widespread flooding has claimed at least 100 lives and damaged more than 110,000 homes. With minimal livestock, shelter and crops, the lives of millions of Sudanese hang in the balance.

“In Sudan, we’re not just in the business of delivering — we’re in the business of saving lives. A large part of our work involves working with aid relief agencies to handle and transport relief goods like medicine, food and water to people in need,” said Adel Moustafa, Country Manager, DHL Express and DHL Global Forwarding Sudan.

“Even when it seems impossible and when all the odds are stacked against us, we always pull through because of the dedication and perseverance of the team.”

The floods may have derailed Sudan’s plans for growth, but a peace deal, local partnerships, and increased connectivity with the world are helping the war-torn nation get back on its feet.

Beset by a 22-year civil war, floods, and Covid-19

Despite having a wealth of oil reserves, decades of fighting have made Sudan one of the world’s least developed countries.

Factions within the nation — mainly the Christian and indigenous Black Africans in the South against the Muslim Arabs in the North — have clashed over issues ranging from natural resources control to grazing rights and the ownership of oil reserves.

An aerial view of the Nile River flood that hit Khartoum, the capital of Sudan
An aerial view of the Nile River flood that hit Khartoum, the capital of Sudan (Photo: Shutterstock)

Political and border disputes have further added to the country’s volatile atmosphere, where nearly 47 percent of the population live below the poverty line. Public debt in 2019 stood at €60 billion, more than double the size of the country’s economy at that time.

The catastrophic floods that swept across Sudan in July 2020 — one of the worst in over three decades — and the ongoing Covid-19 pandemic have only exacerbated problems. As flooding and landslides triggered by torrential downpours destroyed hundreds of thousands of homes and damaged large tracts of farmland, the Sudanese government declared a three-month national state of emergency in September.

The destruction of farms, in particular, compounded the country’s food insecurity issues as prices of basic foods like bread and sugar soared. Being shut off from the rest of the world has also contributed to rising unemployment rates and falling exports in the country.

Opening up to recovery

But for all the hard-hitting blows that 2020 delivered, there were several monumental and favorable developments.

After 27 years, Sudan was finally removed from the U.S. State Sponsor of Terrorism list — a move that denied it access to desperately-needed debt relief and foreign financing.

This has had a positive impact on the country’s investments. For example, foreign direct investments (FDI) grew by US$190.7 million (€157 million) in September 2020, compared to an increase of US$116.3 million (€95.8 million) in the previous quarter. This upward momentum is expected to continue, with FDI predicted to reach US$253.16 million (€208.5 million) this year.

“Aging infrastructure and the lack of investment have slowed development, but the government has been doing more to improve the country’s connectivity with the wider world, especially now with the sanctions lifted,” explained Moustafa.

It has set aside US$300 million (€247 million) for a 10-year plan to develop Port Sudan’s facilities, while a new Chinese-built seaport for shipping livestock in Haidob, south of Port Sudan, is nearing completion.

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According to the latest DHL Global Connectedness Index (GCI), a study measuring the development of trade, capital, information, and people flows at the global, regional, and national levels, international flows helped cushion the blow of economic distress between 2017 and 2019. Sudan’s GDP shrank significantly over that period, but imports and other inward flows held up comparatively well.

More recent data highlight positive growth of Sudan’s imports, which was up 11.9 percent year-on-year in September 2020. Additionally, trading volumes in Sudan’s stock market have been growing in recent years.

“With its strategic location, Sudan also carries the potential of being a leading logistical hub in the region. The country is well-positioned to facilitate the distribution of goods to neighboring landlocked countries including Chad, Mali, and Central African Republic for instance,” explained Hennie Heymans, CEO of DHL Express Sub Saharan Africa.

Pulling through the pandemic

However, for the country to fulfill its potential, they first need to pull out all stops to contain the pandemic.

In December 2020, the Sudanese Ministry of Health announced a rollout of 8.4 million doses of the Covid-19 vaccine. Scheduled to take place in the first quarter this year, the initiative will help curb infection numbers and help the country get back on its feet.

In preparation, Moustafa and his team at DHL Express and DHL Global Forwarding Sudan have provided consultation to the local government on the key procedures and frameworks involved in delivering the vaccines. This includes advice on handling techniques, logistical plans, and efficient delivery solutions to support vaccine distribution across the country.

“Having close collaboration with our global logistics network and establishing the right partnerships with our local partners on the ground will play a key role in driving the country forward, especially in times like these,” added Heymans.

“Both geographically and culturally, we’re confident that Sudan has what it takes to succeed in its critical transition. As a network business, DHL remains ready to lend all the support required to Sudan to embark on this path of recovery and growth.”

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As the Covid-19 pandemic continues to turn up in fresh waves globally, DHL has outlined 10 steps to prepare supply chains to support the quick rollout of vaccines.

When the first Covid-19 vaccine was approved for use in late 2020, it marked a momentous achievement in science.

It was the result of an urgent and expedited development process that would have typically taken years. As scientists worldwide rallied together to develop next-generation vaccine technology, governments invested heavily in manufacturing infrastructure to shore up vaccine production capacities.

To date, more than 2.15 billion vaccine doses have been administered worldwide. Yet, the war against the coronavirus is far from over.

The uneven distribution of vaccines, a decline in raw materials, and new, deadlier virus strains threaten to undo the good work.

Ten billion vaccine doses are required globally for high levels of immunization by the end of 2021, but only four countries have achieved vaccination rates of 50 percent so far, while those with less-developed infrastructure continue to face challenges in the rollout.

Another factor is the constantly evolving global supply chain landscape, according to Leonora Lim, Vice President at DHL Customer Solutions and Innovation, Life Sciences and Healthcare.

“The information sphere is constantly evolving — whether it’s the kind of vaccines approved by each country, the volumes that they require or the ideal temperature and packaging required. This means we need to adapt quickly and efficiently to meet changing demands,” explained Lim.

The need for resilient supply chain networks, smart technology, and cross-border collaborations to help sustain the momentum has never been more crucial. In its latest white paper Revisiting Pandemic Resilience, DHL outlines 10 steps stakeholders need to put in place to support the great vaccine rollout and build a more resilient world.

Source: Revisiting Pandemic Resilience whitepaper
Source: Revisiting Pandemic Resilience whitepaper

1. Establishing partnerships without borders

While Asia was already in the cockpit of the supply race with millions of personal protective equipment (PPE) and test kits shipped out of China and South Korea, the delivery of vaccines has been a different ball game, shared Lim.

It is taking place on a different scale of distribution, and with strict temperature and handling requirements. Cross-sector and cross-border partnerships are necessary to address the urgent need for a viable medical supply chain for the vaccines, she noted.

Collaboration will help stakeholders align on the monitoring and delivery of vaccines and ancillary supplies. For instance, the signatories of the UNICEF and World Economic Forum charter on Covid-19 vaccine delivery have offered pro bono support in the form of specialist logistics personnel for global logistics coordination, and operational assistance for warehousing and cold-chain solutions at regional and national levels.

Partnerships between the pharmaceutical industry, governments, and logistics players can help consolidate expertise under one roof. This means uncovering innovative new treatments, streamlining delivery mechanisms, and even preparing for future pandemics.

2. Building a supportive data backbone

Data is king — even in vaccine distributions. Digitalizing the supply chain helps countries with timely decision-making, from early warning of pressure points to ensuring end-to-end supply chain transparency. For example, the DHL Express Quality Control Center looks out for shipment delays, identify areas that need improvements and take proactive action to address them.

“With data sharing protocols in place across different operating systems, supply chain stakeholders will be able to get a holistic real-time view of the supply chain, which will help resolve bottlenecks efficiently to minimize disruptions,” said Lim.

3. Staying on top of transportation capacity management

Managing transportation capacity can save time and prevent unnecessary bottlenecks that may delay deliveries and compromise vaccine quality.

With vaccine distribution a priority for many countries, securing the right transportation capacity at the right time is vital for the successful delivery of vaccines that may have varying requirements such as temperature control.

Tools such as the DHL Ice Tracker can track the quantity of dry ice that is going to be uplifted, ensuring that it does not exceed the stipulated limit for the safety of the aircraft and crew.

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4. Putting the ‘green’ in packaging

Most approved vaccines have cold or ultra-cold storage temperatures that require special packaging systems, which can be expensive. Ensuring the reusability of packaging will reduce wastage and costs over the long term.

For instance, temperature-control packaging solutions provider Softbox developed a specialized reusable ultra-low temperature (ULT) shipper to support the distribution and storage of ultra-low temperature vaccines. The reusable box, built with high-performance insulation materials, can be topped up with dry ice for ultra-low temperature control to store vaccines for up to 30 days.

An integrated supply chain network with well-functioning return logistics will ensure circularity of such packaging to be refurbished and reused, which could reduce packaging waste by up to 50 to 60 percent, shared Lim.

5. Setting up strategic warehousing

Moving and storing vaccines adequately is just as important as administering them, as incorrect implementation can lead to wastage, noted Ms Lim. And in these pandemic times, wastage can come at a high cost.

Up to 70 percent of health facilities in low and middle-income countries are ill-prepared to store large volumes of Covid-19 vaccines at the optimum temperature. According to readiness assessments conducted by the World Bank last year, just over 50 percent of countries assessed had the cold chain capacities needed to deploy vaccines, based on the cold chain capacity for regular temperature vaccines.

An African doctor holding a Covid-19 vaccine vial (Photo: Shutterstock)
An African doctor holding a Covid-19 vaccine vial (Photo: Shutterstock)

One solution, highlighted in DHL’s Delivering Pandemic Resilience whitepaper, to mitigate the lack of ultra-cold infrastructure locally is to implement the supply chain archetype of direct shipping to the point of use, without the need for cross-docking or repackaging.

For larger countries, governments can explore setting up appropriate storage locations at local or regional levels. This includes taking into account factors like the cost and future utilization of large-scale cold-chain storage and warehousing.

6. Ensuring synchronized flow of goods

Vaccines and ancillary supplies like needles, syringes and diluents go hand in hand. To ensure maximum efficiency, ample consideration must be given for ancillary supplies that need to be shipped and stored either jointly or separately, depending on the local infrastructure, logistical capabilities, and the availability of medical supplies.

In the mountainous kingdom of Bhutan, vaccines and ancillary supplies were combined upon arrival in the country before being delivered to remote locations by foot or helicopter. Over 95 percent of the adult population has received their first shot.

7. Providing easy access to vaccination points

The accessibility of vaccination sites can make or break a vaccination campaign.

Depending on the overall demand and size of the country, vaccination points should be located in areas that allow seamless patient and logistical access.

Citizens queuing for the Covid-19 vaccine in Al Wasl, Dubai, UAE (Photo: Shutterstock)
Citizens queuing for the Covid-19 vaccine in Al Wasl, Dubai, UAE (Photo: Shutterstock)

The United Arab Emirates, for instance, can administer the vaccine at any of its 205 vaccination locations across the country. It has since emerged as one of the fastest countries to roll out vaccines worldwide.

8. Educating the population

Vaccine education can save lives. As a key part of all health systems, community-wide education on the benefits of vaccinations can help people make informed decisions about their health. This means increasing people’s knowledge of the pandemic and change their attitudes to vaccines.

One successful example is Rwanda’s Ministry of Health. It launched a successful vaccine rollout with the help of widescale communication efforts via Twitter, television, and radio, based on personalized updates for vaccination priority groups and the influence of community leaders.

9. Implementing a user-friendly process

A seamless vaccination process can help improve vaccine sign-up rates.

This means creating centralized registration and scheduling based on clearly defined criteria like age, profession, or immunity to the virus. Setting up vaccination locations with minimal barriers to access will also be essential.

A healthcare worker administering the Covid-19 vaccine in Bucharest, Romania (Photo: Shutterstock)
A healthcare worker administering the Covid-19 vaccine in Bucharest, Romania (Photo: Shutterstock)

10. Offering incentives for the last-movers

Vaccinating the public means leaving no one behind. This means offering incentives, or helping to alleviate the associated costs that might deter the public from signing up.

In some countries like Thailand, fully vaccinated people face fewer travel restrictions — the island of Phuket is expected to open its doors to vaccinated travelers. Some possible measures to boost vaccination demand include offering paid sick leave, or free meals and vouchers to encourage vaccination.

Preparing for the next crisis

This public health crisis was not the first, nor will it be the last.

Around 7 to 9 billion vaccine doses and corresponding ancillary supplies are expected to be distributed annually between 2022 to 2023. For this to succeed, all stakeholders must be prepared for high patient and vaccine volumes, maintain their logistics infrastructure and capacity, and plan for seasonal fluctuations.

“The key is to build a well-oiled supply chain system that can stand up to this pandemic and the ones that will follow. Collaboration will be critical to this effort,” shared Lim.

“We’re always working closely with our customers and with so many moving parts, we established a cross-business unit taskforce so everyone is on the same page globally and regionally. This allows us to keep a pulse on the dynamic situation and respond as a group where logistics is needed to deliver healthcare.”

 

For more insights, download the whitepaper here:

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White Paper: Revisiting Pandemic Resilience
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