top locations for purchasing headquarters in the pacific
DESCRIPTION
A review of Best Locations for a Global Purchasing Headquarters in the Pacific Rim. Review of 10 General Criteria. Details of criteria and commentary with tailored analysis provided to clients.TRANSCRIPT
Top Locations for Purchasing Headquarters in the Pacific Rim
Bill Kohnen
A guideline for considering location of Pac Rim Purchasing Headquarters
General Assumptions
• Assumptions are for Global corporations• Professional Purchasing group• Total corporate spend is a significant portion of
revenue – Greater than 45%• Supporting groups such as Supplier Quality,
Supplier Engineering, Logistics are robust and global in focus
• Spending is suppliers used are global supporting global sites
Criteria for Evaluation
• Access to best global suppliers• Infrastructure• Airports and transportation• Ease of doing global business• Diversity of talent and people• Safety• Currency and Financial institutions• Government support• Language• General Stability
Rating
• 1 is very bad
• 5 moderate
• 10 is Excellent
Locations Evaluated• Singapore• Hong Kong• Silicon Valley• Shanghai• Seoul• Penang• Jakarta• Tokyo• Tai Pei• Los Angeles• Manila• Kuala Lumpur
Location Access to best global suppliers
Infrastructure
Airports and transportation
Ease of doing global business
Diversity of talent and people
Safety
Currency and Financial institutions
Government support
Language
Stability
Total
Singapore 8 9 10 9 9 9 8.5 9.5 9 990
Hong Kong 8 7 9 8.5 8 8 8 8 8 880.5
Silicon valley
7 8 6 8 10 6.5
8 5 9 976.5
Shang Hai 6 7 8 6 6 6 5 5 4 8.561.5
Seoul 6 7 8 6.5 6 7 6 6 6 664.5
Penang 4 5 1 4 5 6 3 5 5 745
Jakarta 3 3 2 4 4 3 2 4 4 433
Tokyo 7 6 5 6 6 8 9 6 5 866
Tai Pei 6 5 4 5 5 6.5
6 6 6 655.5
Los Angeles 7 5 4 6.5 7 5 8 7 7 7.564
Manila 4 3 4 6 4 3 4 5 7 444
Kuala Lumpur
6 8 7 6 5 7 7 7 6.5 766.5
Best Places To Locate Purchasing Headquarters in Pac Rim
Singa
pore
Hong Kong
Silico
n valle
y
Kuala Lu
mpurToky
oSe
oul
Los A
ngeles
Shan
g Hai
Tai Pei
Penang
Man
ila
Jakart
a0
102030405060708090
100
Comment
• Generally the best places to locate Global Purchasing headquarters match “common thought” for overall business
• If one where more focused on spending in a particular area then a lower scoring area might be higher in a specific case
• Shenzhen was not on the list as a global location but arguably could be in mid range.
Cost
• Although not a direct element rated operating costs tend to be lower in the lower scored locations– However – because of other issue total hidden
costs can be unexpectedly high