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Electronics appliance giant Electrolux is on its first shopping spree in Singapore.

It is here to meet, identify and possibly appoint local companies as its suppliers for electronics and precision components.

It also plans to make Singapore one if its key logistics hub in the region, if it starts buying components from companies here.

Last year, Electrolux bought some US$400m worth of components from suppliers in Asia, but none from Singapore.

That was because most of the components were sourced close to the company's key manufacturing facilities in China and India.

But that is about to change.

"Definitely Singapore is a very special way for the business. Talk about Japan, it is very innovative but very expensive. Talk about China, there's not too much innovation but very cheap. But, talking about Singapore, it just fits in between. So, it is good to get Singapore for the purchasing," said Jay Cheng, Electrolux Group's general manager, corporate purchasing.

This year, Electrolux is planning to buy some US$600m worth of electrical and electromechanical components from around the world.

And hopefully, a major portion of that sum will go to Singapore companies.

Electrolux's purchasing team is in town to meet with 27 local firms -- more than half of whom are listed.

These firms have been identified by IE Singapore as potential component suppliers to the Swedish firm.

Among them are Venture, Armstrong Industrial, Flextronics, Wearnes Precision and Beyonics.

"Well, Singapore as what Electrolux mentioned earlier, we are still very strong in plastics manufacturing as well as electronics products. Even companies like Electrolux recognises that we have that kind of strength...." said Andrew Khaw, IE Singapore's deputy director, electronics & precision, engineering.

And it doesn't just stop there.

If Electrolux is convinced the Singapore firms make good suppliers, it may decide to locate one of its key regional logistics hubs here.

But for now, Electrolux is not able to say how much of components it will buy from Singapore.

"We are going to find a few hubs for logistics -- Korea, Shanghai, Hong Kong, Singapore. For Singapore, probably we can develop more and more because, like what I said last year, we haven't got too much business in Singapore yet. Hopefully after this activity we are going to create more and more business. And then we will talk about hiring one more person. We are going to talk about setting up more purchasing activities here," said Jay Cheng.


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