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JUSDA Insights Reverse the Stream

Reverse the Stream

From Asia to Europe: the prevailing direction of the Eurasian trade. World's leading exporter is China and goods and services exported to the “old continent” alone accounted for 371 billion euros in 2016. European export to China totalled 207 billion euros. But as the Chinese people get richer, their buying power raises and so does their demand for genuine European brands and products. We see this growing trend and are prepared to support new chapter of the Eurasian trade.

A great part of globally sold goods is nowadays manufactured in China or Asia in general. From the logistics & transportation industry perspective, the unbalanced goods flow between West and East is an opportunity to take advantage of. JUSDA aims to seize it and urge European companies to maximize their export potential through offering a unique logistics solutions and full-scale services in China and Asia.

This would create a bidirectional stream of goods allowing producers to introduce more efficient and sustainable T&L solutions. The whole concept is closely related to the BRI - Belt & Road Initiative aiming to revive the ancient Silk Road connecting China, Middle East and Europe. JUSDA cooperates with BRI as one of their original business partners with a strong railway expertise, in particular.

The Belt & Road Initiative has been designed to enhance the orderly free-flow of economic factors and the efficient allocation of resources. It is intended to further market integration and regional economic co-operation framework creation. (map: beltandroad.hktdc.com)

How to reverse the stream?

JUSDA Europe has the vision of a brand new level of supply chain solutions. In fact, the concept goes beyond the traditional model known for decades. “In the traditional way, there is the producer followed by a number of wholesalers, retail distributors, and finally - the customer. We want to condense the process by leaving out some of the links, thus dramatically shortening the journey of products.

"It can be done in both directions with the help of e-commerce connecting customers with producers in a more rational way. We are actively developing an online platform which will enable true spot-buying between directly connected sellers and buyers,” explains Miroslav Zajac, Business Development Manager, JUSDA Europe.

Marketing and e-commerce platforms will mediate early stages of the customer-supplier partnership.  One side is the Chinese customer inquiring European goods, second the supplier willing to export to China. There are numerous steps on the successful journey, from goods production e.g. in Czechia until the final set up to sale in China. JUSDA Europe is going to establish a full support team easing the process of proper partner search, business model setup, products certification, border customs management or optimal supply chain design, management and execution.

When do we start? We are working on a pilot case right now. A Chinese customer asked us to help them to find a European powder milk producer. We have selected possible suppliers, arranged the products certification for the Chinese market, overcame all the border and importing requirements and sent the first samples to China. We are to design the optimal supply chain in order to get our first containers to China beginning of 2018. If all goes as expected, we are talking about the full block train being transported there on regular basis. However, it is still somehow a preparation phase,” adds Miroslav Zajac.

Getting to rapidly growing consumer markets is not easy but with a deep knowledge of distribution networks and T&L practices in China, European producers can avoid many risks.

(photo: Adi Constantin, Shanghai)

How to integrate China into your global supply chain?

Although many business plans count with Chinese and Asian consumer markets, relatively small number of companies have yet integrated their global supply chains to take advantage of this opportunity. To become successful on both continents, businesses need to combine their Sourcing-Centric and Sales-Centric roles to create an efficient Global Supply Chain Integrator who comes to the state when “both China sourcing/manufacturing and sales markets are integrated, mutually optimized, and globally leveraged. As further described by Ronald Haddock in Integrating China into Your Global Supply Chain: “This is an elite class of companies; it frequently includes smaller or medium-sized companies that, by necessity, had to take an integrated approach from Day One in China, launching a series of complementary initiatives that collectively have a company-wide impact that the boards of some larger organizations may have considered risky.”

For most manufacturers, it is unrealistic to establish such a level of integration by themselves. Very few can become part of the “elite class of companies” and the majority will depend on experienced and knowledgeable partners. They will look for supply chain professionals with deep knowledge of China with its specific business culture and tremendous potential.

JUSDA Europe is a global supply chain integrator with EMEA headquarters based in the Czech Republic, designs and manages supply chains and integrated T&L solutions for global brands around the world. During almost two decades with Foxconn, JUSDA became a true supply chain expert. Rooted in China, where JUSDA International serves more than 10.000 customers by operating 48 distribution centres covering more than 600 inland Chinese cities, JUSDA Europe has gained profound knowledge of China and its complex infrastructure. Joined together with its central European location and professional expertise, the company has fair preconditions to co-create a new chapter in Eurasian trade and to open the way East for expanding European companies.

author: Miroslav Zajac, Business Development Manager, JUSDA Europe


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