Southeast Asia is increasingly becoming a popular place for major brands to make gadgets, widgets and all things electronic.
Analysts have attributed the increase to the high-quality labor available in the region coupled with lower costs and more favorable economic climate compared to China. Although this global market shift is relatively new for many electronics manufacturers, New Kinpo Group (NKG) has long predicted additional EMS growth will be fueled by the Southeast Asia market. This early vision and strategic investment has allowed NKG to develop a vast, stable supply chain in the region.
Although the industry is notoriously slow and often belabored, NKG forecasts more companies will begin to shift operations to the region. Below are three reasons Southeast Asia will continue to grow as a strategic location for electronics manufacturers.
- Middle class growth – Southeast Asia’s middle class is diverse, confident in the economy and growing more affluent by the day. In 2012 there were an estimated 190 million people in Southeast Asia who could be defined as middle class. According to Nielsen, that number will more than double by 2020, to 400 million people. This will translate into an increased demand for consumer goods.
- Infrastructure – Global shipping expenses have made it crucial to look for more effective production sites and Southeast Asia is becoming the center of gravity. As a result, the company’s international customers are able to capitalize on our robust infrastructure to better serve local customers. With our extensive knowledge of local markets, NKG is able to vertically integrate stable supply chains and keep our design team close, drastically improving delivery time for our customers.
- Modern technology – The increasing desire for mobility and productivity coupled with access to more disposable income will continue to drive overall demand for consumer electronics products. IoT also represents a major opportunity for the region to foster innovation that would create a positive impact not only for consumers and businesses, but also in the education field.
Based in Taiwan for more than 40 years and in Southeast Asia for 24 years, NKG continues to invest throughout the region in order to offer customers greater flexibility, lower costs, faster delivery times, and world-class product quality. Most recently, NKG opened a new factory in the Philippines. This highly-automated, vertically-integrated factory employs more than 8,000 skilled workers dedicated to consumer product manufacturing. Watch the video from our recent grand opening celebration below.
With manufacturing sites located strategically throughout the world—including not only Southeast Asia, Thailand, the Philippines, and Malaysia, but also the U.S., Brazil and Mexico—and a vertically integrated model, NKG will continue to achieve lower manufacturing costs and greater efficiencies than other global EMS/ODM companies who are just now realizing the opportunity this vast and environmentally diverse region has to offer. As NKG strategically expands into new markets to best meet the needs of our customers, we expect other manufacturers will continue to follow the footprints along the path we’re forging.