Intellectual property theft and supplier strategy problems are the top risks facing manufacturing and retail firms with operations in China, industry experts warned today.

Other areas outlined by a report from IDC subsidiary Manufacturing Insights include logistics and transportation, infrastructure and national as well as local political events.

"By identifying and ranking these risk areas, our aim is to help supply chain executives understand current trends for manufacturing lead times, inventory and transportation costs associated to products originating in China, as well as to anticipate future changes," said Bob Ferrari, programme director of supply chain strategies at Manufacturing Insights, and author of the report.

In addition to ranking the top risk areas, survey respondents also identified the top IT tools affecting operations in China.

The majority (70 per cent) rank enterprise resource planning software as the most effective IT tool.

Supply chain collaboration portals, advanced demand or supply planning systems, transportation management and control systems and storage resource management or procurement systems also ranked highly.

"The increased use and effectiveness of IT and applications is a positive sign for the region," said Ferrari. "This, coupled with data showing some improvement in lead times, indicates that all in all, operations are progressing."