FinTechPayments TechnologyChinese manufacturers broaden horizons with SAP Ariba

Chinese manufacturers broaden horizons with SAP Ariba

SMEs in China are driving growth and reaching out to global customers by adopting digital technology platforms that enable them to make their payment and procurement processes more efficient and coherent.

As China becomes an ever more central and active part of the global economy, the country’s SMEs are seeking cross-border payment services that enable them to increase their international business partnerships. Crucial to this is an emphasis on digital transformation, with digital networks and cloud-based apps being harnessed to drive more efficient processes for end-to-end procurement management.

One example of this in practice is the recent announcement that the authorities in Ganzhou Nankang district, the site of China’s largest furniture-manufacturing complex, have made SAP Ariba the strategic platform for digitizing procurement processes and managing spend from source-to-settle.

The furniture manufacturers in Ganzhou Nankang are predominantly small enterprises, yet they export their goods all around the world – in fact, there’s a good chance that some of the furniture in your home or office originated in the area.

Ambitious growth

Following the opening of the Ganzhou Port in 2016, the opportunities to reach a global market for local companies grew exponentially; more than 300 manufacturers in the region now export furniture to 100 different countries. In order to fulfill demand from buyers in the US, Latin America and Europe, it was essential that the manufacturers found a technology platform that enabled them to hit their ambitious growth targets.

Our ability to execute depends directly on a platform to help us expand business globally

“We are on a mission to grow the furniture industry in China and become the world’s largest furniture innovation hub,” the government of Ganzhou Nankang commented. “Our ability to execute depends directly on a platform to help us expand business globally and to manage the sourcing, procurement and payment of goods and services with maximum efficiency and speed. It is therefore essential that we have a holistic, automated source-to-settle system that is smart, reliable, and easy to use.”

SAP Ariba’s platform offers the SMEs access to a simple, open and smart set of tools that can be used to manage the entire sourcing process – from uncovering opportunities for savings, identifying and qualifying suppliers and negotiating optimal agreements, to implementing contracts, tracking savings and managing supplier performance. This can be done across all categories of spend, from indirect goods and services to direct materials. More than 3.4 million organizations in 190 countries around the world – including more than 160,000 across Greater China – are already connected to the Ariba Network.

Smoothing the supply chain

“Procurement today requires a modern digital platform,” said Fua Chye Yaw, general manager, Greater China at SAP Ariba. “Knowing this, forward-thinking organizations like Ganzhou Nankang are embracing SAP Ariba’s solutions to manage the procurement process from source to settle, while controlling spend, minimizing risk, identifying new sources of savings, creating new business opportunities and building a healthy, sustainable supply chain.”

Platforms such as SAP Ariba’s cloud-based applications and business network are designed to enable SMEs to discover, connect and collaborate with a global network of partners to expand beyond sourcing materials locally. It means they can place and manage orders, view and manage spend across all major categories – from indirect, direct and logistics to contingent labor and services, travel and capital expenditures – in a single location, to find opportunities for savings and build a healthy, dynamic supply chain.

Meanwhile, suppliers can connect with profitable customers globally who are increasingly doing business online, thereby opening new markets and revenue streams.

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