China is moving at an accelerated pace compared to other developing countries and as its retail landscape changes, the Supply Chain infrastructure has to be reassessed. We take a look here at the transformation of SPAR China’s Supply Chain from an initial investment into ambient Distribution Centres to the development of modern, fresh cold chains, supplemented by the first bakery production facility in Weihai.

In 2016, SPAR International and SPAR China began supporting a long-term objective of the Chinese government to modernise retail in the country. This modernisation includes the end-to-end Supply Chain – one of eight areas making up our Scope of Service under the ‘Better Together’ strategy.

Incentivised change

The Supply Chain in China was under-developed but this is fast changing and is becoming a huge point of difference in brand strength in the market. Customers trust a brand that has the products available that they are looking for. If not, they will quickly move to a brand that does.

To harness learnings in Supply Chain developments from other SPAR Partners, our colleagues in China travelled to South Africa and Austria to learn about their fresh Distribution Centres (DCs), and to Slovenia and Hungary to find out about their bakery facilities.

The focus in China is now on the fresh Supply Chain, with support being provided by SPAR International. Work is being done to develop fully integrated food production centres and central bakeries as a key means of SPAR China differentiating itself from the competition and excelling in fresh food.

Developments to date

The Supply Chain developments in China now see 12 DCs in operation with learning exchanged between partners. A focus is being put on exploring ways of achieving increased efficiency across the Supply Chain with investment in the modernisation of DCs that embrace technology to improve capacity and capability.

To achieve this increased efficiency, our partners in China are adapting automation in their Supply Chains, aimed at maintaining the profit margin for DCs and retailers, whilst providing customers with high quality products at fair prices.

SPAR China Supply Chain facts:

• 12 Key Distribution Centres in operation
• Total ambient warehouse operating area of 268,000m²
• Total fresh warehouse operating area of 128,000m²
• Total production centre operating area of 74,350m²

This story was first published in issue 2 2017 of our quarterly magazine, Contact International.

To read more stories from this edition, follow this link.