[photopress:containers_1_2_3_4_5_6.jpg,full,alignright]A major article in Forbes suggests that China, with its double digit growth, is becoming not just the world’s manufacturer but the supply chain king. Airfreight is building, its gateways are surging and its warehouses are bulging at the seams.
The majority of China’s exports go out from the ports of Shanghai, Hong Kong and Shenzhen. Together, they handle more than 55 million shipping containers a year. However, airfreight is accounting for more of their high-tech products transport and some other more sensitive or costly goods.
Another consequence of growth is the expanding need for warehouse space and coping with increased inventories and longer supply lines. There is a move in China toward adopting warehouse management systems to accommodate these needs. Warehousing is a growth business. One company, ProLogis, is planning new distribution parks in Quindao, Hangzhou, and Ningbo (all coastal cities) that comprise 300, sq meters of space.
Companies like Wal-Mart have their own growth pattern in China. The discount retailer already has 56 stores and is the single largest buyer of Chinese products. If Wal-Mart were a country it would rank eighth among China’s world trading partners.
China’s logistics costs for 2004 were $351.6 billion. They have increased appreciably since then. More than 20 percent of the nation’s GDP is spent on logistics compared with 8 percent for the U.S. As a percentage of GDP, however, China’s costs have started to come down, indicating an improvement in logistics.