SAP Hong Kong and Deloitte Help Ease Cross-Border Trade
The massive shifts in global supply and demand caused by the global pandemic continue to disrupt the trade industry. and have joined forces to assist enterprises in navigating the increased complexities and high risks.
“How effectively organizations manage global trade in today’s rapidly changing environment will directly impact a company’s success,” said Martin Naraschewski, SAP general manager and global head of line of business Finance & Risk. “The (SAP GTS) application provides the platform necessary to allow organizations to scale globally yet remain nimble and compliant regionally.”
Deployed in nearly 3,000 enterprises in 25 industries across more than 170 countries, SAP GTS a global trade management platform, helps organisations reduce costs and mitigate risks of non-compliance through better managing free-trade agreements and customs procedures.
A More Efficient Cross-Border Supply Chain
Whether on the cloud or on-premises, SAP GTS allows full integration of trade services, which is where Deloitte steps in, offering a one-stop-shop for end-to-end worldwide trade services. Enabled with SAP GTS, Deloitte assists companies in ensuring compliance and more synergetic trade management. Deloitte’s trade specialists hold extensive experience in customs, compliance, preferential trade agreements (ensuring you take advantage of any preferential tariff treatments) and technology implementation.
Fabian Padilla Crisol, Managing Director, SAP Hong Kong, said, "Business leaders in high-tech, life sciences, luxury goods, industrial machinery and other sectors understand the importance of optimizing cross-border supply chains. With the support of SAP GTS and Deloitte, these businesses are now well-positioned to navigate an increasingly volatile and complex global trade environment in 2021 and beyond."
Andy Zhou, Deloitte Consulting China SAP Offering Leader, said, "To prosper in the dynamic global trade environment, enterprises are required to keep up with the cross-border trade policies and regulations, meet new consumer demand and the development needs of complex supply chains. The combination of Deloitte's services and SAP GTS technology allows deep integration and seamless connection to establish a stable, efficient and compliant global trade management model and solution.”
IHS Markit/CIPS: UK Manufacturing PMI near-record high
UK manufacturing trends
For the UK manufacturing sector, growth of output and new orders were both reported by IHS Markit and CIPS as among the best seen over the past seven years, which in turn has led to a strong increase in employment. Despite this, the sector continues to face supply chain delays and input shortages, which resulted in increased purchasing costs and record selling price inflation.
UK Manufacturing IHS Markit/CIPS Purchasing Managers’ Index® (PMI®)
Seasonally adjusted, IHS Markit/CIPS Purchasing Managers’ Index® (PMI®) rose to 60.9 in April, which was an increase compared to March (58.9) and above the estimated 60.7 for April.
Increasing for the eleventh consecutive month, the latest readings are the highest since July 1994 (61.0). The output growth for April has been attributed to the loosening of lockdown restrictions, improving demands and a rise in backlogged work.
“The manufacturing sector was flooded with optimism in April as the PMI rose to its highest level since July 1994, bolstered by strong levels of new orders and the end of lockdown restrictions opened the gates to business. It was primarily the home market that fuelled this upsurge in activity though more work from the US, Europe and China demonstrated there were also improvements in the global economy. This boom largely benefited corporates as output growth at small-scale producers continued to lag behind,” said Duncan Brock, Group Director at the Chartered Institute of Procurement & Supply.
In addition to expanding production, total new orders rose for its third consecutive month, which was attributed to a revival of domestic market conditions, stronger client confidence, parts of the economy reopening and improving global market conditions.
While new exports rose in April, the rate was reported as weaker in comparison to new orders. “Companies reported improved new work intakes from several trading partners, including mainland Europe, the US, China and South-East Asia. Large-sized manufacturers saw a substantial expansion in new export order intakes, compared to only a marginal rise at small-sized firms,” said IHS Markit/CIPS.
UK Manufacturing’s outlook
Remaining positive at the start of the second quarter, 66% of companies forecast that output will be higher in a year's time, which is attributed to expectations for less disruption related to COVID-19 and Brexit, economic recovery, improved client confidence and new product launches.
“Further loosening of COVID-19 restrictions at home and abroad led to another marked growth spurt at UK factories. The headline PMI rose to a near 27-year high, as output and new orders expanded at increased rates. The outlook for the sector is also increasingly positive, with two-thirds of manufacturers expecting output to be higher in one year’s time. Export growth remains relatively subdued, however, as small manufacturers struggle to export,” said Rob Dobson, Director at IHS Markit.
Adding to comments from IHS Markit and CIPS, , Managing Director of Freight and Logistics at Accenture Global said: “While today’s figures are positive overall, the worsening supply situation is still a concern, with rates of both input costs and selling price inflation running far above anything previously seen. Shipping delays and material shortages are driving huge backlogs of uncompleted work and the surge in manufacturing orders is leading to many firms struggling to boost operating capacity to keep up with demand. With business expectations becoming even more optimistic as the economy rebounds, the big question will be whether firms will be able to cope with the surging inflows of new orders.
“As ongoing supply chain issues are still at large, companies with wide international footprints should look to reassess their logistics strategies by running supply chain stress tests and simulations in order to respond quickly to upswings and variability in demand. A flexible and resilient supply chain will be a key way for businesses to remain both competitive and stable as we emerge from the pandemic”