The Shipping Point: The Rise of China and the Future of Retail Supply Chain Management

CHAPTER ELEVEN

DYNAMIC SUPPLY CHAINS

The Origin Consolidation Model

MICHAEL JACOBS

As the complexity of consumer retail relationships continues to evolve, the need for a more dynamic and flexible supply chain intensifies. China remains at the forefront of global retail sourcing. Its entry into the World Trade Organization (WTO) and its liberalized customs regulations have created new opportunities for retailers to implement more comprehensive distribution models at the manufacturing point of origin. To properly address this area of opportunity it is necessary to cover a comprehensive landscape of supply chain terminology and industry best practice in order to articulate the overall value proposition that exists. Specifically, this chapter will cover:

• Key terms used to define the business of importing from China
• Development of terms of sale for managing risk and payment options
• The scope of available services provided by key supply chain providers in China and measurements for success
• Importing technology along with other value added services and future trends

China 's economic expansion since 1978 has been the fastest of any major nation. During 2001, as China was admitted into the WTO, the Chinese government made a commitment to further provide an environment of economic liberalization and deregulation. Incredibly, as of 2007, China's economy has expanded to now represent the second-highest gross domestic product (GDP) worldwide, as shown in Figure 11.1 (using purchasing power ...