Navigating supply chain operations in the new normal

Peter Nguyen, co-founder of thuocsi.vn

Thuocsi.vn is a B2B platform for healthcare and pharmacy, supplying different types of healthcare and pharmaceutical products in Vietnam. During the pandemic, we experienced supply chain disruptions both at home and abroad. The company had to temporarily close if there was just one infection. Indeed, several distributors and suppliers of important drugs for Vietnamese customers have encountered a lot of disruptions.

Fortunately, we have set up our own warehouses in Hanoi and Ho Chi Minh City to respond quickly to the situation. When the cities were locked down, we still managed to transport products from Ho Chi Minh City to Hanoi in one night. Our plan is to find some more warehouses in the southern area. In particular, we will develop smaller distribution centres in close proximity to customers. This will help streamline our operation as well as reduce the delivery time to only 1-2 days.

Nelson Wu, CEO of BEST Inc. Vietnam

One of the things we observed as the pandemic became more under control is the changing consumer behaviours. Many merchants moved from offline to online retail due to social distancing measures. However, the situation has improved with the removal of quarantine measures. It is interesting to note that many consumers continue to purchase online, creating additional demand for e-commerce platforms.

The pandemic has accelerated the development of e-commerce. As a result, a growing number of merchants are recognising this shift and beginning to establish an online presence. This change has an impact on supply, demand as well as distribution routes. This is a positive force because e-commerce currently accounts for a small proportion of Vietnam’s retail industry. It is expected that the country will attract more players in the future.

Michael Chan, director of Sales at BW Industrial Development JSC

The pandemic has changed the manufacturing landscape. Many manufacturing facilities have had to deal with COVID-19 infections during the outbreak. There are also some headwinds such as the possibility of new variants, rising oil prices, power outages in China, and so on. Manufacturers need a plan B to cope with the upcoming challenges. Vietnam has always been chosen as an alternative destination for manufacturers due to its strategic location and stable politics.

Indeed, many big investors are coming to Vietnam and seizing new investment opportunities. The queries for our ready-built factories have doubled from last year. Manufacturers, especially those from the fast-moving consumer goods and electronics industry, want to localise their supply chain in Vietnam. They also want to stock up on inventories and materials for production and retail, which creates additional demand for warehouses in ports and manufacturing areas.

Alexander Falter, general director of ECCO

The pandemic has created unprecedented challenges. Vietnam, Indonesia, and Thailand have reopened their borders at the same time, while China remains closed.

Our company mainly relies on water and air travel. We don’t travel by road or rail very often, so we have a lot of challenges. In particular, ocean and air transportation has become more expensive along with other supply chain headwinds like container shortages. The process to bring a container into Vietnam was quite complicated even before the pandemic. We hope to see this process ease soon.