ASEAN must accelerate digitisation, modernisation of supply chain - RS Components - MIDA | Malaysian Investment Development Authority
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ASEAN must accelerate digitisation, modernisation of supply chain – RS Components

ASEAN must accelerate digitisation, modernisation of supply chain – RS Components

16 Oct 2020

ASEAN needs to speed up digitisation and modernisation of its supply chain, according to RS Components, the world’s largest electronics and maintenance products distributor.

It said the urgency was necessary to improve regional supply chain and prevent delays in the supply of goods particularly during a pandemic like COVID-19.

The pandemic had tested the global supply chain which was seamlessly interwoven pre-COVID-19, and due to the health risks, factories in Asia were temporarily shut down and production pace scaled down to keep workers safe.

RS Components general manager (Singapore and Malaysia) Eileen Yap said many businesses experienced delays from suppliers for items such as electronics.

She said 70 per cent of global electronics manufacturers and suppliers experienced between a two to four weeks delay by their own suppliers due to the pandemic.

“As you know, delays aren’t just one-off – they caused domino effects, and impacted international shipping and logistics, for instance,” she told Bernama.

RS Components has been serving Malaysian manufacturers since 1996. It is a trading brand of UK-based Electrocomponents Plc, a global omnichannel solutions partner for industrial customers and suppliers involved in designing, building, or maintaining industrial equipment and facilities.

Operating in 32 countries, RS Components trade through multiple channels and ship over 50,000 parcels a day.

Yap said COVID-19 had amplified the underlying issues of the traditional global value chain (GVC) as manual labour is still perceived as cheaper than investing in technology and automation.

“By accelerating innovation in the supply chain, it would address bottlenecks as businesses need at least 70 per cent to 80 per cent of visibility across the chain.

“As for manual labour, businesses must adopt technology to improve efficiency and productivity, protect employees and factory equipment, and reduce costs in the long run,” she said.

To prevent delays in the supply chain ecosystems, RS Components’ eCommerce platform offers a personalised experience to help customers quickly find products. At the same time, its eProcurement system allows businesses to manage their spending by maintaining full visibility of costs.

“The system allows businesses to source from our catalogue, support vendor consolidation, and improve contract compliance – that they can also access and use whenever and wherever they are working from, without having to wait for a sales visit or a call from distributors.

“These would help accelerate processing and makes reporting easier for the clients,” Yap said.

She said customers with complex industrial requirements can also save time searching and negotiating with multiple suppliers and simplify their procurement process by working with RS Components team specialising in sourcing products yet to be published on the website.

According to Yap, Southeast Asia has emerged as a contender and is ready for opportunities presented by the restructuring of the global supply chain, even if the implementation of trade cooperation at the national level is still pending.

“ASEAN governments are discussing the next step towards regulatory alignment and some of the ASEAN member states have adopted various trade and transport facilitation agreements at a regional level, but their implementation at the national level is still pending.

“We will need to see more far-reaching agreements across the region to increase efficiency and propel the growth potential in cross-border transactions,” she said.

Source: Bernama