India and Vietnam: manufacturers of choice in '08

2008 will see a change in Asia Pacific outsourcing trend shifting to India and Vietnam.

According to Manufacturing Insights Asia Pacific (an IDC company) more companies will set up manufacturing plants or look for outsourcing partners in Vietnam and India with much influence by the cost and market perspective. In India, local manufacturing activities and manufacturing services such as design and engineering are set to grow in 2008. Vietnam on the other hand, will emerge as the new low cost manufacturing centre.

The report also say companies will differentiate their IT strategies and deployment by using applications that enable the management to connect outside the organisation, as Enterprise Resource Planning (ERP) becomes standard. Manufacturing companies in Asia will improve their outward connections to differentiate themselves from their competitors.

Manufacturing companies looking for growth and expansion will move into research, development and engineering capabilities, driven by the following three key factors; growth of outsourcing knowledge work, contract manufacturers who want to grow through their own product development activities and governmental support.

On top of these predictions, Randy Sng, associate research director at Manufacturing Insights also added, “IT investment that enables an integrated enterprise to engage with its trading partners will be the main vehicle for faster response to the ever-changing market demand. Time spent on analyzing the vulnerability road map and building resiliency will ensure business continuity, minimize risks, and maximize opportunities. Going ‘Green’ in manufacturing and building a ‘Green’ supply chain will bring additional benefits to the environment and the companies."

The “Asia/Pacific Supply Chains 2008 Top 10 Predictions” annul report excludes Japan.