In recent years, global companies have sought to increase their presence in developing countries such as India or China. Some believe these emerging economies offer a major pool of potential new customers into the next millennium. Others, such as my own company, Pier 1 Imports, rely on these same countries as an important source for the products they sell.

Doing business in a developing market offers tremendous potential for growth. But at the same time, it brings some formidable challenges—particularly for the supply chain professional. Some of those challenges are common to any global supply chain operation. For example, all global shippers are facing a reduction in the actual number of ports of call by the "mega" vessels, accompanied by the increased use of feeder ships under a hub-and-spoke approach. Additionally, we must handle a profusion of different proprietary information systems used by the various consolidators, carriers, and brokers. And companies like Pier 1 must negotiate the high costs of handling, moving, and storing relatively high-volume/low-cost merchandise.

A number of other supply chain challenges are more specific to emerging nations. Principal among these are inadequate port and cargo-handling infrastructure, difficulty of finding experienced and capable logistics services providers, and a variety of cultural issues. And in parts of the world with a significant imbalance of trade, importers find themselves subsidizing the cost of repositioning containers and the loss of revenue from diminished export cargo. In a sense, the importer is paying for both the inbound and outbound trade. On top of this, the trade imbalance often causes a lack of equipment at various origins and results in a frenzy of activity as the carriers struggle to reposition empty equipment where it is needed.

Depending on the specific country, there may be other hurdles to clear as well. Yet despite all the challenges, the bottom-line mandate for any company (and particularly any retailer) doing business in a developing country is clear: Have the right product in the right place at the right time and for the right price.

For supply chain professionals, the challenges—and opportunities—of doing business in an emerging nation are nowhere more evident than in India. This rapidly growing economy has become an important trading partner for the United States as well as for many other countries. But even with the increase in trade and the many supply chain-related advances made in recent years, India remains an especially tough place from which to import merchandise.

After 10 trips to India in almost six years, I could share countless stories about why things didn't work out the way we originally hoped they would. Consider, for example, the difficulties of moving product into and out of Bombay (now called Mumbai), the country's chief center of commerce. Transporting goods into Bombay can be an exercise fraught with problems ... a domestic transportation infrastructure that is inadequate (by Western standards), manual cargo-handling processes, power disruptions, severe weather patterns, and more.

Moving goods out of Bombay was not any easier. Until the Port of Nhava Sheva formally opened a few years ago, companies had to ship most of their cargo out of the old Bombay port. The antiquated port infrastructure, outdated cargo-handling methods, and limited facilities there made on-time scheduling and transport predictability a pipe dream for most importers. Delays were commonplace and could stem from any number of sources including ad hoc labor disputes involving Customs, longshoremen, truckers, clearing agents, and other parties. The port's malfunctioning locks only added to the unpredictability.

In short, when it came to importing products from India, you often had to forsake a JIT (Just-In-Time) supply chain strategy in favor of a JIC (Just-In-Case) version.

Despite all the challenges, India represents a significant source of merchandise for us. And because our logistics program is a strategic component of our business plan, we were committed to investing the time and resources required to "make it work." We needed to guarantee a much higher level of shipment predictability for our buyers.

For Pier 1, the right approach centered on collaboration and understanding. We listened, we learned, and we adapted to the idiosyncrasies of this valuable trading partner. We found it worth remembering that India had been involved in international trade long before most American companies and that, in many ways, the country continued to use its traditional trade methods. Our job was to understand how the Indian system (or any significant trading partner's system) worked and tailor our supply chains accordingly. We learned that you can't take a supply chain approach that works in Hong Kong, for example, and simply impose it on India. The appropriate modifications needed to be made if you were to enjoy any kind of success.

With the support and backing of our merchandising group, we partnered with highly capable third-party service providers and fostered a creative approach that introduced Western technology and methods while respecting Indian culture. To foster mutual understanding, we held a number of joint meetings with our vendors, agents, and logistics service providers to gain their support, cooperation, and ideas. This was the first time we had met as a group, and these meetings proved to be a critical component of our success. We got our message across that everyone had a vested interest in helping improve Pier 1's logistics operations because those operations formed the basis for additional business for everyone involved.

It's amazing what happens when you assemble everyone in the same room, close the doors, and work in good faith on mutually advantageous solutions. Instead of goods taking 75 to 110 days to move from the Indian suppliers to our distribution centers, these shipments now take 35 to 45 days on average. In addition, we receive all of our documents within days of the vessel's departure and have access to information about our shipments. In the past, this information had been extremely difficult—if not impossible—to obtain.

We also noticed a significant improvement in shipping predictability after the major carriers moved from the old Bombay port to the Nhava Sheva port. At this new facility, they enjoy fixed-day arrival and sailing, terms previously unheard of in India. Furthermore, productivity at the terminals has reached the levels found at many other Asian ports. All of these enhancements serve to improve shipping predictability.

Our experience in India underscores an important point about the need for collaboration. It reconfirms that we at Pier 1 Imports can't sit back in Fort Worth, Texas, and attempt to understand how things work in India—or China, Thailand, Indonesia, or the Philippines for that matter.

Before we implement a supply chain strategy that meets our corporate objectives, we need to work closely with our partners in those countries. In successfully meeting our logistics challenges, we need to take the time to learn from our partners and understand why things are the way they are. Then and only then can we put the appropriate mechanisms and partners in place to make our supply chains as efficient and cost effective as they need to be.