Rapid Growth Ahead for Asia/Pacific's Internet Procurement Role

Asia/Pacific manufacturers will supply more than 20 percent of the world’s manufactured goods via global Internet-based supplier and buyer procurement hubs by 2004, according to GartnerGroup’s Dataquest unit.

According to Dataquest, international electronic commerce software and services vendors will dominate the region’s Internet-based manufacturing hub market through 2004 because the region continues to lack the necessary local expertise to independently manage global electronic supply chain networks 24 hours a day.

“Over the next five years, manufacturing Internet hub services in Asia/Pacific will expand rapidly and establish long-term links with global procurement networks,” said Lane Leskela, senior analyst at Dataquest. “These procurement networks will be organized according to vertical industry supply chains, including plastics, electronic components, auto parts, pharmaceuticals, an building materials. The emerging global procurement environment will require international vendor expertise to create and manage complex electronic supply chains composed of thousands of manufacturers, distributors, forwarders, and buyers located throughout the world.”

According to Dataquest, vendors are under pressure to provide higher levels of client support and integrated application delivery because of the rapid development of highly distributed electronic supply chain (SCM) networks, electronic commerce software, and services. These vendors are in an environment evolving from traditional electronic data interchange (EDI) extranets to global procurement hubs delivered via the Internet.

“As the delivery of EDI and Web-based trading applications over the Internet grow exponentially, so will the penetration of lower-cost electronic SCM solutions among small business participants in new regional and global procurement networks,” Leskela said.