Overall Assessment

The competitiveness and logistics performance of Malaysia are highly supported by the service sector. They act as enabler and encourages the trade domestically and globally. Competitiveness is the ability of the industry to provide products and services as or more effectively and efficiently that the relevant competitors or countries.

The proportion of logistics contribution to manufacturing firm

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Logistics represent the greatest opportunity for improvement in supply chain performance. It is based on core competencies of firms whether to insource or outsource their logistics activities. The pie chart shows the proportion of logistics contribute to competitiveness of manufacturing firms. Only 28.3% of respondents agree, logistics contribute below that 50% of firms competitiveness. This results demonstrate that logistics is strategic component for long term competitiveness of firms

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The proportion of logistics function that manufacturing firm can control

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There are opportunities and challenges for firms whether to control their logistics activities or outsource. Outsourcing has benefitted manufacturers, in which they can focus on their core business and use logistics service providers as strategic partners. Meanwhile, direct involvement in the logistics activities of the firm’s operations will allow them to assess and control logistics performance regularly and act accordingly without depending to other.

Based on the pie chart, it is about 42% of respondents are agree that 50% to 79% of their logistics activities are control by themselves.

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Proportion of logistics cost in firm turnover

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Minimising logistics cost is the one of firm’s strategy to remain competitive. It is part of various logistics performance dimensions such as quality and flexibility. Logistics cost includes transaction costs (those related to transport and trade, for processing permits, customs, standards), financial costs (inventory, storage, security) and non-financial costs (insurance). In our context, we are focusing on four main activities and administration, including

  1. Transport and cargo handling cost
  2. Warehousing cost
  3. Inventory carrying cost
  4. Logistics administration

Based on the graph, it is demonstrates that between 60 percent to 70 percent of respondents agree that these cost are below than 30 percent out of firm turnover.

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Logistics competitiveness of Malaysia is better than other Southeast Asia countries

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Logistics has a key role to play in increasing the competitiveness of Malaysia. Logistics is vital important for both services and manufacturing sectors. It is contributes in the context of materials’ contribution, components and products. As a results, indirectly determining cost factors in production.

In Malaysia, logistics is currently strategic industry, involves cross-functional and global discipline. Authority should have a clear role to play in creating the appropriate framework for trade logistics in Malaysia. Based on the responses, only 43 percent of respondents agree that Malaysia is more competitive than Singapore’s logistics. However, more than half of the respondents agree Malaysia is much more competitive rather than other ASEAN countries. This is not meant that we are more better than other countries, however it is a benchmark for Malaysia to remain competitive and strategically plan logistics agenda as priority.

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