As global supply chains restructure, Thailand, Indonesia, Vietnam, and Malaysia are absorbing production capacity from China’s automotive, electronics, chemicals, and equipment manufacturing sectors.
Southeast Asia has become an attractive destination for Chinese manufacturers expanding overseas. Industry data from PSS Insight forecasts that the region’s MRO (maintenance, repair, and operations) market will exceed USD 58 billion by 2029, with annual growth remaining above 7%. Yet regional supply capacity is lagging behind production expansion, and media reports suggest many manufacturers expanding overseas have encountered substantial procurement obstacles.
China’s MRO procurement system may be mature, but it cannot simply be replicated overseas. Fragmented local suppliers, inconsistent material standards, lengthy cross-border fulfillment cycles, and high compliance hurdles for hazardous chemicals can lead to factory shutdowns caused by material shortages, uncontrolled procurement costs, and inefficient cross-border material management. These issues have become bottlenecks for the stable operation of overseas production lines.
ZKH Industrial Supply, a global digital MRO industrial services provider, expanded its presence in Southeast Asia through local entities established in Thailand and Indonesia in 2025. In those markets, it has formed on-site teams, built regulatory-compliant warehouses, and accumulated supplier resources, while developing a supply model that combines a cross-border domestic inventory pool with local centralized procurement. The model is designed to address pain points faced by Chinese companies overseas, including cross-border sourcing, warehousing and fulfillment, customs compliance, and emergency supply support.
“As manufacturing continues to expand overseas, single-channel cross-border trade and fragmented local procurement can no longer meet the needs of large-scale factories,” said ZKH’s head of overseas sales. “We chose to first establish operations in two of Southeast Asia’s key manufacturing markets, localizing more than 20 years of digital industrial supplies and supply chain capabilities, developing a professional MRO globalization path suited to Chinese manufacturers expanding overseas.”
MRO supply gaps weigh on factory operations
Southeast Asia’s manufacturing capacity is expanding rapidly, but the region’s local supply chain remains underdeveloped. This has created a mismatch between strong demand and weak supply, with traditional procurement models struggling to keep pace.
Procurement challenges for frontline manufacturers generally fall into several areas:
- Difficulty sourcing domestic spare parts, keeping overall procurement costs high.
- Long cross-border fulfillment chains and a lack of emergency stock support and on-demand supply guarantee capacity.
- Fragmented material standards across multiple countries and a lack of unified digital governance tools.
- Fragmented local suppliers and an imbalance between investment and returns when companies build in-house self-developed supply chains.
- High compliance thresholds for hazardous chemical storage and transportation, alongside scarce professional fulfillment resources.
In 2025, ZKH Industrial Supply implemented a two-pronged global expansion strategy covering Europe, the US, and emerging markets, with Southeast Asia serving as a key focus area for supporting Chinese manufacturers expanding overseas.
Following the establishment of localized entities in Thailand and Indonesia, ZKH has developed local teams familiar with industrial regulations, customs procedures, and manufacturing procurement practices. These teams provide on-site support, helping customers coordinate sourcing requirements, documentation, delivery arrangements, and after-sales services.
Balancing coverage with delivery speed
Overseas factories typically require both coverage of China-made nonstandard spare parts and timely replenishment of local consumables. To meet these needs, ZKH Industrial Supply has built a tiered sourcing framework that balances supply breadth with delivery speed.
Backed by more than 27 million SKUs across 32 MRO product categories in China, ZKH consolidates inventory domestically before shipping standardized orders to Southeast Asia, helping reduce logistics costs while ensuring access to specialized industrial components that are often unavailable locally.
The company is also using local supplier resource pools in Thailand and Indonesia to screen manufacturers that meet industrial standards and hold complete local regulatory compliance certifications. Its coverage includes personal protective equipment (PPE), labor protection supplies, general-purpose hand and industrial tools, and standard industrial consumables for high-frequency, small-ticket procurement needs. Local warehouses can deliver within two to three days, addressing daily urgent replenishment needs on production lines.
Expansion plans
With its operations in Thailand and Indonesia established, ZKH Industrial Supply’s next phase of Southeast Asia expansion will focus on strengthening local capabilities, expanding regional coverage, and developing localized supply solutions for overseas manufacturers.
In Thailand and Indonesia, ZKH plans to increase investment in local support capabilities and upgrade localized services. The company will continue expanding its local industrial technical service teams, increasing standardized warehousing capacity, optimizing local inventory turnover management, shortening spare parts delivery times, and strengthening site-specific service capabilities for large vehicle and chemical plants.
Beyond Thailand and Indonesia, ZKH plans to expand into markets such as Vietnam and Malaysia through an asset-light model. By leveraging its existing regional warehouse network, cross-border logistics capabilities, and supplier resources, the company aims to build a more connected MRO service network across Southeast Asia.
ZKH will continue focusing on four key industries: automotive, electronics, chemicals, and equipment manufacturing, providing integrated MRO procurement solutions covering industrial consumables and automation-related spare parts. Through its innovation and R&D center in Taicang, Suzhou, China, the company will further develop overseas offerings of private-label industrial products, including automation components, PPE, labor protection supplies, and industrial lubricants.
It will also continue iterating its cross-border digital material management system to unify material standards across countries and reduce the labor costs companies face in managing materials across regions.
Setting a benchmark for Southeast Asia’s MRO supply chain
While serving Chinese-invested factories, ZKH Industrial Supply is also promoting standardized upgrades among local suppliers in Southeast Asia, improving the region’s industrial support system, and enabling more coordinated development across Chinese and overseas industrial chains.
In 2026, ZKH will continue deepening its localized presence in Southeast Asia and improving its regional warehouse network and local supply chain system. Through digital technology, it aims to drive global supply chain coordination, help more Chinese manufacturers establish stable operations in Southeast Asia, address overseas MRO procurement pain points, and support the globalization of Chinese manufacturing.
About ZKH Industrial Supply
ZKH Industrial Supply is a global provider of digital MRO procurement and industrial supply chain services. Leveraging a digital procurement platform, extensive product portfolio, and integrated warehousing network, the company supports manufacturers across multiple industries. In Southeast Asia, ZKH operates localized entities in Thailand and Indonesia, providing sourcing, fulfillment, digital material management, and compliance support for manufacturers expanding overseas.
This press release was published in partnership with ZKH Industrial Supply.