Rerouting APAC Supply Chains for a Fractured World, featuring Garret Lu
When the Strait of Hormuz effectively closed earlier this year, it triggered the largest oil market shock in recorded history. For supply chain leaders across Asia Pacific, it reinforced a clear message: lean, single-path supply chains are becoming harder to defend in a more disrupted world.
Supply Chain Insights spoke with global experts on how businesses are planning for disruption. For Dematic, the key perspective comes from Garret Lu Vui Ping, Sales Director, Asia at Dematic, who sees companies translating regional supply chain strategies into more practical operating models.
APAC Supply Chain Resilience and Regionalisation Strategies | Dematic
"Clients are actively reducing reliance on any single country or supplier. We're seeing China-plus-one and even China-plus-two strategies, as they expand into Southeast Asia and India," he says. "But organisations are taking a cautious approach, making incremental adjustments and building operational readiness step by step."
- Garret Lu Vui Ping, Sales Director, Asia at Dematic
Other experts interviewed by Supply Chain Insights point to the same broader shift. Businesses are diversifying suppliers, reassessing where inventory should sit, and investing in technologies that improve visibility and flexibility. Larger corporates are moving more actively, while mid-sized businesses often face the sharpest pressure because they carry global exposure but have fewer resources to respond quickly.
The Real Cost of Going Local
Regionalisation can reduce exposure to disruption and long lead times, but it also adds cost and complexity. Companies may face duplicated inventory, higher labour costs, more supplier management requirements and additional infrastructure decisions.
For Garret, automation and software-enabled execution are important because they help offset these trade-offs rather than simply adding another cost layer.
"Regionalisation introduces higher operating costs, duplicated infrastructure and more nodes to coordinate,” he says. “Automation, supported by software layer, helps to mitigate those trade-offs. It delivers consistent throughput and accuracy across multiple sites, reduces dependency on local labour conditions and enables higher density storage, which helps make up for smaller facility footprints.”
Building for Multiple Futures
With policy, trade and demand conditions changing quickly, many businesses are questioning how to invest without overcommitting. The answer, Garret says, is to design for optionality and scalability rather than one fixed future.
“The approach has moved from optimising for a single outcome to building optionality and scalability into supply chain decisions,” he says. “We encourage clients to run what-if analyses across different geopolitical and demand situations so that decisions are more robust. Don’t try to predict the future – design a system that can adapt to it.”
In practice, this means phasing investments, working with trusted 3PL partners where appropriate, and prioritising proven, software-enabled and scalable solutions over untested technology.
Garret notes that customers moving forward with automation increasingly want repeatable regional models that can be standardised across countries as their networks expand.
The wider market is also moving toward more adaptable technology platforms, including cloud-native systems, real-time control towers and AI-enabled decision support. For a Dematic website audience, these points work best as supporting context to Garret’s central message: resilience has to be built into execution, not only strategy.
Future-Ready Design
Across the expert discussion, the common direction is clear: supply chains need stronger visibility, more diversified sourcing and more flexible operating models. Garret summarises the requirement in three attributes: digitally connected, operationally flexible and automation-enabled.
"It needs real-time visibility and data-driven decision-making, supported by integrated software. It needs built-in redundancy and diversified sourcing. And it needs to integrate automation to reduce reliance on labour and manage volume fluctuations," he says.
"There’s still a gap between that and where many supply chains sit today. Many networks are still relatively centralised, labour-intensive, and designed around cost efficiency rather than disruption resilience. The next phase of transformation has to balance efficiency with flexibility and responsiveness, scalability and operational readiness."
- Garret Lu, Sales Director, Asia at Dematic
For APAC businesses, the next phase is not simply about moving supply chains closer to home. It is about building operating models that can absorb disruption, scale across markets and maintain performance when conditions change.
About Dematic
Dematic delivers intelligent automation solutions for the supply chain that adapt to change, maximise productivity and capacity, reduce risk, and create lasting competitive advantage. Drawing on the combined expertise of more than 10,000 employees worldwide, Dematic develops, implements, and supports operations featuring advanced technologies and software. With consulting, research, engineering, manufacturing, and service centres in over 26 countries, Dematic is a trusted partner for distributors, warehouses, and manufacturers globally. Headquartered in Atlanta, Dematic is a member of KION, the Supply Chain Solutions Company.
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