Tokyo--The rise of tech-savvy and demanding consumers, enabled by online retail, will bring more jobs back to the U.S., said the chairman of one of the world's biggest factory middlemen.
"There's a revolution going on, driven by consumers," said Victor Fung, group chairman of Hong Kong-based Fung Group, at The Wall Street Journal CEO Council in Tokyo on Tuesday.
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Instead of the 10 months that manufacturers used to have to deliver products from design and conception, they are now talking in terms of weeks, if not days, to delivery, he said.
The need to meet consumer demands quickly may ultimately mean a shift that would bring the final assembly process to the U.S., although components may still be supplied globally, he said.
"That's what's going to drive change, not a group of politicians," Mr. Fung said.
The new face of the consumer is one that the 111-year-old Fung Group has been studying closely. The group rose to prominence as a conduit between Western retailers and China's factories. That business model is now under siege as retailers work directly with their suppliers and the rise of online retailers undercuts the middleman.
Slow to adapt to the transformation brought by e-commerce, the Fung Group's Hong Kong-listed sourcing company, Li & Fung Ltd., logged its third straight annual decline in both revenue and profit in 2016, with revenue falling to its lowest since 2009. The group is now betting big on information technology to create a digital supply chain to help clients better compete against online retailers.
Mr. Fung attributed 80% of the impact from globalization, including job losses, to technology, rather than the spread of the supply chain overseas.
Political concerns aside, companies need to be more aware that over the long term, the main growth in consumption will come from Asia, Mr. Fung said.
Younger Chinese shoppers, who spend four to five hours online a day, are forcing supply chains to become faster, he said.
"They are the sweet spot," he said.
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(END) Dow Jones Newswires
May 16, 2017 00:29 ET (04:29 GMT)