US retailers push Asian suppliers deeper into supply chain

Facing greater uncertainty in the consumer market, North American retailers are trying to hold off purchases of finished goods until as late as possible by pushing their suppliers in Asia to retain ownership of products deeper into the supply chain, reports The Journal of Commerce. The retailers are trying to hedge their risks and hold onto cash, and that means more suppliers who once provided goods on the docks in Asia are being called on to manage the transportation of finished products through increasingly congested trans-Pacific distribution channels.  Reduced cycle time and cost savings make this appealing to importers, but it's causing panic among suppliers and a splintering of the supply chain at a critical moment, with volumes increasing but resources limited.

"The long-existing supply chain model is broken," said Patrick Ahern, vice president for international at National Retail Systems, a New Jersey-based provider of logistics to retail importers. "And it hasn't been replaced by a new model."

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