SCMAP Perspective #265

Published in Port Calls, April 25, 2o11

Competition Law

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By Ed Sanchez
SCMAP Executive Director

Increased Attention

In recent days there has been increasing talk about competition law, also called anti-trust law. I have seen news items and columns on the subject. Last month, the PCCI, through its think-tank UACT, together with the EU Trade Related Technical Assistance, held a seminar workshop for the drafting of a private sector proposed bill on competition law and policy. Legislators have also been activity drafting bills.

No doubt the increased attention to competition law has been spurred by certain events. I am referring to the steep rise in world crude oil prices. The series of increases in fuel prices has raised the specter of cartel, as price watchers compare fuel prices at different gas stations.

In addition, movements in the corporate world have contributed to the increased discussions of cartel, monopoly and corporate dominance..

Examples of corporate movements are the acquisition of Digitel by Smart, the acquisition of ATS by Nenaco, the sale of Mang Inasal to the Jollibee Group, and the combination of Philip Morris and Fortune Tobacco.

For sure, the Philippines needs a law on competition. Not only now, even decades ago.  At present, the Civil Code deals briefly with combinations in restraint of trade in a short paragraph. The Philippines has lagged behind the rest of the world in enacting a law on competition. The US is the lead country in this area.

An interesting news clipping appeared in business newspapers last week. Procter & Gamble, Unilever and Henkel were penalized for anti-competition behavior by the European Union, in the area of detergents pricing.

This news bit jogs my memory back to the late 1970s to early 1980s when I was working with Unilever Philippines. In the Management Committee, I was carefully on the lookout for cartel behavior by the Soap and Detergents Association of the Philippines. It would have been easy to discuss prices in meetings of the association, but much more so in one-to-one telephone calls. SDAP then included Procter & Gamble, Unilever, Colgate, Johnson & Johnson, Champion and Royal Oil. So it was, and is, never too early to have a law on competition.

SCMAP has had its share of conflict with cartels and monopolies and would-be monopolies. I will cover this in the next issue.

Last Call – Logistics Immersion Seminar

Slots are still available for this year’s Logistics Immersion Course. Reservation deadline is April 27, 2011. Seminar topics and speakers are:.

• MARINA Plans & Programs (Emerson Lorenzo, MARINA Administrator)

• Logistics 101 & the Role of Shipping in Philippine Logistics & Its Impact on Transport Cost (Cora Curay, SCMAP Vice President, XVC Logistics President)

• A Step in Professionalizing the Logistics Industry in the Philippines (Dennis Llovido, SCMAP President & AVP – Transport Head, Nestle Phils.)

• Understanding Shipping Commercial Terms (Ike Castillo, President Fast Logistics Corp.)

• The Major Infrastructure Developments in the Philippines (Henry Basilio, President REID Foundation)

• Philippine RORO and the ASEAN RORO Connectivity (Jet Acena, Deputy Team Leader, RORO, REID Foundation)

• Philippine Economic Performance and Forecasts for 2011 (Ronilo Balbieran, Economist – UA&P, Deputy Team Leader, REID Foundation)

In addition, the seminar will allow the following side benefits

1. • Observation of actual port operations. Participants can see how cargoes are handled at the port, and how the vessel moves them.
   • Discussion by this year’s host Aboitiz on its customer service initiatives for 2011. This will provide opportunities for better collaboration.
   • Networking and benchmarking opportunities with SCMAP members and industry business partners.

The itinerary is Manila – Cebu – Tagbilaran – Manila. The Manila – Cebu leg is via Superferry 21; Cebu – Tagbilaran is via fast craft and Tagbilaran – Manila is via Philippine Air Lines

Fees are

• For SCMAP members                     P14,235 + 12% VAT = P15,944
• For Non-SCMAP members                        P17,794 + 12% VAT = P19,930

The fee covers vessel and air fare, hotel accommodation, meals, seminar materials and gift packs.

Other Seminars

SCMAP’s schedule for the year is not yet finalized, but the following are the initial offerings.

• Transport Management Workshop (2 days)                                June 24-25
• Strategic Procurement (1 day)
• Quantitative Approached to Logistics Planning (1 day)

Address inquiries and comments to Ed Sanchez at tel. 671-8670, fax 671-4793, cell 0918-914-1689, or email scmap.org@gmail.com. . Those interested in SCMAP training and other activities are requested to send their e-mail addresses.

April 20, 2011

SCMAP Perspective #264

Published in Port Calls, April 11, 2o11

Logistics Immersion

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By Ed Sanchez
SCMAP Executive Director

An Annual Event

Since 1993, SCMAP (then DMAP) has been holding its Annual Shipping Immersion Course, which conducts a seminar on shipping while participants are en route to a destination, typically in the Visayas.

The idea was picked up by DMAP from CISO / DSA, the forerunner of PLSA, during the days of Paciencio “Boi” Balbon and Ric Romero.

The destination varied each year, and has included Cebu, Iloilo, Bacolod, Puerto Princesa, Boracay, Tagbilaran, Cagayan de Oro and Coron..

In recent years, the seminar has been modified. Last year it was renamed the Logistics Immersion Course. The mode of travel was expanded to include air travel for the return leg, and seminar topics were expanded to include non-shipping topics, such as infrastructure developments and the economy.

This year, SCMAP’s Logistics Immersion Course will consist of the following seminar topics and speakers.

• MARINA Plans & Programs

Emerson Lorenzo, MARINA Administrator

• Logistics 101 & the Role of Shipping in Philippine Logistics & Its Impact on Transport Cost

Cora Curay, SCMAP Vice President, XVC Logistics President

• A Step in Professionalizing the Logistics Industry in the Philippines

Dennis Llovido, SCMAP President & AVP – Transport Head, Nestle Phils.

• Understanding Shipping Commercial Terms

Ike Castillo, President Fast Logistics Corp.

• The Major Infrastructure Developments in the Philippines

Henry Basilio, President REID Foundation

• Philippine RORO and the ASEAN RORO Connectivity

Jet Acena, Deputy Team Leader, RORO, REID Foundation

• Philippine Economic Performance and Forecasts for 2011

Ronilo Balbieran, Economist – UA&P, Deputy Team Leader, REID Foundation

In addition, the seminar will allow the following side benefits

1. • Observation of actual port operations. Participants can see how cargoes are handled at the port, and how the vessel moves them.
   • Discussion by this year’s host Aboitiz on its customer service initiatives for 2011. This will provide opportunities for better collaboration.
   • Networking and benchmarking opportunities with SCMAP members and industry business partners.

The itinerary is Manila – Cebu – Tagbilaran – Manila. The Manila – Cebu leg is via Superferry 21; Cebu – Tagbilaran is via fast craft and Tagbilaran – Manila is via Philippine Air Lines

The following are targeted as participants.

• Supply chain logistics, distribution or transport staff requiring an introduction to logistics &  shipping functions
• Other transport staff requiring a refresher and latest updates
• Managers and non-shipping or non-transport staff in related and interface functions (warehousing, distribution planning, trucking, inventory management, purchasing, accounting, engineering, QA, etc) who require a basic understanding of domestic shipping and logistics management)

Everybody is enjoined to take advantage of this chance to experience a truly unique learning experience.

Fees are

• For SCMAP members                     P14,235 + 12% VAT = P15,944
• For Non-SCMAP members                        P17,794 + 12% VAT = P19,930

The fee covers vessel and air fare, hotel accommodation, meals, seminar materials and gift packs.

Deadline to register is April 20, 2011

Other Seminars

SCMAP’s schedule for the year is not yet finalized, but the following are the initial offerings.

• Transport Management Workshop (2 days)                                June 24-25
• Strategic Procurement (1 day)
• Quantitative Approached to Logistics Planning (1 day)

Address inquiries and comments to Ed Sanchez at tel. 671-8670, fax 671-4793, cell 0918-914-1689, or email scmap.org@gmail.com. . Those interested in SCMAP training and other activities are requested to send their e-mail addresses.

April 9, 2011

SCMAP Perspective #263

Published in Port Calls, March 14, 2o11

Escape from Disaster

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By Ed Sanchez
SCMAP Executive Director

The triple disaster that struck Japan on March 11, 2011 and the following days and the consequent drama is known to everyone.

From the point of view of SCMAP however, there was additional specific drama unknown to the general public.

On February 28, a delegation of twenty Filipinos flew out of the Philippines to Yokohama, Japan, consisting of scholars form SCMAP and PCCI, plus would be professors in the newly launched Certified Philippine Logistics Masters Program (CPLM). The scholars represented the 2011 (second) batch of students in Logistics Management under the AOTS of Japan (Association for Overseas Technical Scholarship). Of the scholars, five came from SCMAP member companies. Of the would-be professors, six came from SCMAP lecturers.

The students from SCMAP were Dan Aguinaldo (Monheim), Ruth Que (Fast Logistics), Joseph Talavera (ICCI), Manuel Rodil (LiteXpress), Vida Libranda (Jugro).

The professors were Ike Castillo (Fast Logistics), Al Lagera (PLDT), Gabby Patag (TNT), Malou Santos (SCMAP consultant), Ana Rose Ochoa (SCMAP consultant), Rhia Pereda (Nestle).

The logistics management course was scheduled to run from February 28 to March 11, and the entire delegation was to fly back on Saturday, March 12, 2011.

But the triple disaster started on March 11, which was supposed to be the last day of the course, consisting of the case presentation and graduation. The students felt the first shaking at around 2:46 pm.

As later narrated by Ike Castillo, they looked up to Logistics Master Sakai-san for some guidance but his translator simply said, ‘This is normal in Japan, don’t panic.’  Ochie started to say some prayers and another suggested they take cover. They ducked under the study tables and spent minutes that felt like eternity.  As they settled down, not knowing the severity of the situation, they joked about how one said prayers in circles; how two other male colleagues ended up holding hands; and how two others managed to squeeze under a tiny table.

That was just the beginning. Ike’s story is quite long, so I have tried to shorten it below. I hope he will forgive me for any inaccuracies.

• After-shocks followed. They surmised that the earthquake was way beyond any of the 1,500 earthquakes that Japan would normally experience in a year.

• The coordinator Hase-san asked them to vacate the room, not to use the elevator and converge at the ground floor.
• On the ground floor, the tv broadcast of the tsunami-hazard map showed the entire Japan coastline at risk. They could tell that they were in the vicinity of a red spot on the tv screen.
• Ike tried sending messages to the Philippines but couldn’t get through as the network was already down.
• They were prohibited from going back to the rooms or from leaving the center. Even if they wanted to, they probably couldn’t go far as the rail system had already halted
• Still unable to send mobile messages, Ike re-activated his old facebook account and started communicating successfully. While denying to be a facebook subscriber, Ike admits that facebook turned out to be handy at that time of need.
• That evening, the aftershocks were scarier. The tv had already shown the tsunami on the northeastern part of the country.
• Most of them slept with the doors open that night. At 4am they were up and getting ready for departure to airport. Later that morning, they felt another shock, which turned out to be another earthquake near Tokyo and Yokohama.
• Another big news then struck them. While the chartered bus was waiting and ready, the driver took eight hours to reach the Center. The usual 1.5 hours travel to Narita Airport could take also some eight hours.
• They were assured that the Center was a better place, given its facilities, food and water supply. It was indeed a better place though the hourly aftershocks started to distort their orientation.
• By Saturday noon they were advised to prepare as the Center decided to move them to Sakura City to be nearer the airport the following day. The coordinators had been working on a number of options for them.
• It was possible that they might actually be getting nearer the heavy earthquake zone, but the chance of making it home that weekend was higher with the chosen option. They were warned though that the usual 1.5 hour travel time could still take anywhere between four to eight hours with the freeway still closed to traffic..
• It took seven hours to reach Sakura but they were warned that the hotel had no water and food and that they would need to buy something outside. At the Sakura hotel that night, they felt another major aftershock. Around 5:30am, they were all complete and ready to go home.
• They reached Narita Airport in forty-five minutes. They were not assessed for the heavy check-in baggage.
• The flight was delayed by 30 minutes, and as it was being announced, another aftershock shook the Narita airport. On March 13^th, at around 2:00 PM, Philippine time, JAL Flight 741 touched down at NAIA and twenty Filipinos finally declared themselves Logistics Masters who survived the big one in Japan!

Address inquiries and comments to Ed Sanchez at tel. 671-8670, fax 671-4793, cell 0918-914-1689, or email scmap.org@gmail.com. . Those interested in SCMAP training and other activities are requested to send their e-mail addresses.

March 26, 2011

SCMAP Perspective #262

Published in Port Calls, March 14, 2o11

Back to $150?

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By Ed Sanchez

SCMAP Executive Director

World Turmoil and Oil

The series of rebellions and turmoil that is sweeping across North African and Middle East countries is unheard of. Situations such as have been happening there, used to be isolated, in different places, and far apart in timing. It seemed that the oppressed peoples in these regions got together and put the Philippine model of people power to good use. The greed of overstaying rulers and the elite has caused untold sufferings among these impoverished peoples,

I am connecting the above scenario with recently announced news on billionaires in the world. Four Filipinos are now among the billionaires in the world. Other countries, BRIC (Brazil, Russia, India, China) have increased their numbers of billionaires. This increase in numbers of billionaires suggests that the distribution of income and wealth in these countries is becoming more and more lopsided, and most probably in other countries. As we are witnessing in the Philippines, wealth is becoming more concentrated in a few.

I am implying that the turmoil in North Africa and the Middle East is due to the lopsided distribution of income in their countries. Maybe these rebellions are a historical necessity, in much the same way that the revolution of the working class was, as predicted by the now discredited communist movement

But the impoverished are always at an obvious disadvantage. There are always powerful wealth concentrating mechanisms, plus the natural law of economies of scale. Even then the oppressed appear to be having more luck now in removing overstaying and corrupt rulers. Thus the historical necessity mentioned above can have overall benefits.

One of the side effects of the rebellions is the disruption of oil supply (Libia), bringing up specters of the record oil price of $150 a few years ago. There are now forecasts of $144 (by Merry Lynch), very close to the record. Obviously this will wreak havoc on supply chain costs, leading to re-design of supply chains.

Logistics Master Program

SCMAP, together with PCCI, and under the guidance of JETRO (Japan External Trade Organization), is pushing on with the CPLM (Certified Philippine Logistics Master Program), launched last January, and targeted for July for the first run.

The CPLM Program is a 12-module program running for 16 Saturdays and costing P50,000 per participant.

The modules are:

• Introduction of Logistics & Logistics Cost & Services
• Transportation Management
• Warehouse Management
• Inventory Control Management
• Factory Logistics & Purchasing
• Key Performance Indicators
• Logistics Information System
• Customer Service
• Laws and Regulations in Logistics
• Improvement of Works
• Packaging
• Demand & Supply Planning & Forecasting

Note a little bit of Japanese flavor in the titles of some of the modules.

Teaching the modules will be stalwarts from SCMAP, and some from PCCI and UA&P. The instructors from SCMAP are : Ike Castillo, Malou Santos, Al Lagera, Ana Rose Ochoa, Gabby Patag, Rhia Pereda.

The instructors spent two weeks in Japan, going over the Logistics Management Course, together with the second batch of AOTS students.

The instructors and the second batch got a bad scare last Friday when the big one (earthquake intensity 8.9) hit Tokyo and environs. Fortunately the course was held in Yokohama, a bit away from the epicenter, offshore from Tokyo.

The SCMAP group is safe, and should be home now, Monday.

Address inquiries and comments to Ed Sanchez at tel. 671-8670, fax 671-4793, cell 0918-914-1689, or email scmap.org@gmail.com. . Those interested in SCMAP training and other activities are requested to send their e-mail addresses.

March 11, 2011

SCMAP Perspective #261

Published in Port Calls, February 14, 2o11

SCMAP 2011

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By Ed Sanchez
SCMAP Executive Director

As a continuation of the conversion of DMAP to SCMAP four years ago, SCMAP further expands its horizon this year. This will be enunciated by re-elected President Dennis B. Llovido of Nestle Phils. at the induction of SCMAP officials this Friday, February 18, 2011. The event will be held at the EDSA Shangri-La Hotel’s Garden Ballroom

The traditional induction event will swear into office the ten directors, including the six officers, plus the committee chairpersons. The ten directors are Dennis Llovido (President, Nestle Phils.), Cora Curay (Vice President, XVC Logistics), November Canieso-Yeo (Secretary, Globe Telecom), Lito Nepomuceno (Treasurer, Integrated Commissary), Rene Casas (Auditor, JG Summit Petrochem), Arnel Gamboa (PRO, Benby Enterprises), Danny Cabrera (Zuellig Pharma), Al Lagera (PLDT), German Martizano (Unilever Phils.), Lloyd Dizon (Koldstor Centre).

The committee chairpersons are Remie Co (FastCargo), Yhel Reyes (GAC Logistics), Dina Pilapil (IDS Logistics), Marilyn Lauron (Getz Bros.),  Max Yap (Oriental & Motolite), Olive Ramos (DHL Supply Chain), Abbe Daza (Omni Logistics), Gabby Patag (TNT), Jet Chua (Messe & Handel),  Continuing to help SCMAP are Ike Castillo (FastCargo), Ana Rose Ochoa, Annette Camangon, Elsie Oafallas, Ninoy Rollan

Tapped to be inducting officers and keynote speakers are PPA General Manager Atty. Juan Sta. Ana from the government and Negros Navigation CEO Sulficio Tagud from the private sector.

SCMAP’s planning session held last month in Tagaytay set the tone for the further expansion of SCMAP, by crafting SCMAP’s vision – Always Moving Ahead in Supply Chain, a simple but catchy line.

SCMAP also re-crafted its mission as follows.

• To continually work for a well-informed and educated supply chain industry
• To professionalize supply chain practitioners
• To partner with government in creating sound policies, rules and legislations that benefit the industry

SCMAP will press on with its advocacies to reduce supply chain costs and to improve service.

But President Dennis will announce new projects which will add dimensions to the role and activities of SCMAP in Philippine industry. We do not want to preempt President Dennis, but some new projects have already been previously announced.

The Certified Philippine Logistics Masters Course was launched late last month at the Logistics Forum at New World Hotel. The set of professors that will handle the new course will be going to AOTS Yokohama later this month. They will be joined by the second batch of students in Logistics Management coming from SCMAP and PCCI. The project is a collaborative effort of SCMAP with PCCI, together with the support of JETRO.

The Search for Best Practices in the Philippine logistics industry will be pushed through the Salute to Excellence Awards, a long standing SCMAP project.

Other projects pertain to a repository of SCM knowledge and approaches to introduce SCM to the youth.

The picture being painted by SCMAP under the leadership of Dennis Llovido is a bright and exciting one. SCMAP beckons to everyone interested in contributing to the evolution of SCM in the Philippines.

Address inquiries and comments to Ed Sanchez at tel. 671-8670, fax 671-4793, cell 0918-914-1689, or email scmap.org@gmail.com. . Those interested in SCMAP training and other activities are requested to send their e-mail addresses.

February 14, 2011

SCMAP Perspective #260

SCMAP Perspective #259

Published in Port Calls, January 15, 2o11

PUBLIC MARKET MALLS

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By Ed Sanchez
SCMAP Executive Director

Malls

A recent news item that appeared in a few newspapers reminded me of a column I write nearly five years ago.  March 6, 2006. The news item pertains to the conversion of public markets into malls. For example, Business World published on January 10, 2011 “SM to convert public markets into malls”.

My column in 2006 was titled “A different kind of distribution problem”. This appears unrelated to the news item. My column dealt with the lopsided distribution of wealth, how our social, political and economic systems and structures favor the biggies. Here are some highlights

I said that the greatest problem of the Philippines was not overpopulation, but the lopsided distribution of wealth.  Even if we could cut the population in half overnight, we would still have a lot of people below the poverty line, as long as the distribution of wealth continued to be lopsided, which I think it would.

All our economic, social and political systems favor the biggies and powerful against the small, poor and disadvantaged. These systems all move towards concentration of  wealth in a few big and powerful companies and families.

There are several groups of structures or systems that work to perpetuate and worsen the distribution of wealth. They work in two ways:

• Diminish the total wealth to be distributed
• Cause concentration of wealth in a few

These structures or systems include:

• Economies of scale
• Bias in favor of biggies
• Control by biggies over mechanisms that spread wealth
• Investors that bring wealth out of the country
• Monopolies and cartels, including laws that support them, and the lack of laws to control and prevent them
• Crooks
• Inheritance

Economies of scale are a natural advantage of the big. Economies of scale result from the spreading of fixed costs over a big volume.

In addition to the natural advantage of economies of scale, structures and systems favor the big.

As we can see it, the lopsided distribution of wealth will continue. There are very few forces that push for distribution, such as wage orders and lotteries. They are too weak and their effect is too small. Technology has been helping the small as “equalizer” (cell phones, internet) but the effects are too small. It seems that there is a need for a giant Robin Hood who will do things legally.

I also mentioned the phenomenon of malls as another example of wealth concentration. The small sari-sari stores have been disappearing. Wealth is being concentrated in the mall owner. Even the store owners are not the beneficiaries of the “mall system” as their payments to the mall owner are instantly computed from their cash registers.

In addition the mall owner benefits from other sources of revenue related to mall operation. Some of these are parking fees to be paid by customers, and delivery penalties and introductory fees to be paid by suppliers of goods. Introductory fees are a fee to be paid by a goods supplier for starting to supply an sku of a product. Delivery penalties are fees to be paid by the supplier or trucker for missing the delivery window, for example 6:00 am to 3:00 pm. I have even experienced having to pay to use a toilet in one mall.

In fairness to the mall owners, there have been some benefits from mall operations, such as sanitation, time savings and improved availability of products to customers. On the other hand, malls have caused added traffic problems in the areas where they operate.

Thus we have pluses

• Better sanitation
• Time savings to customers / improved availability of products

And we have minuses

• Added supply chain costs from mall fees (delivery penalties, introductory fees, parking)
• Added traffic
• Concentration of wealth

Looking at the above, it is quite clear that concentration of wealth belongs to a different category of effect, to me clearly outweighs the meager pluses.

The new idea on public markets being converted into malls will be piloted by SM in Dasmarinas, Cavite. Under the agreement, SM is leasing a two hectare lot from the local government. SM cannot increase rental rates for public market tenants beyond the the fees approved by the local government. Details are not clear. What will happen to government revenues from the public market?

At this time, I can only say that we should keep a close watch over the Dasma project. It could lead to further lopsided distribution of wealth. More small time entrepreneurs could be wiped out.

For SCMAP, it should pay some attention to the retail end where different fees are being charged by the mall owners which can contribute significantly to rising supply chain costs.

Upcoming Activities

Activities endorsed by SCMAP

• Strategic Sourcing & Procurement Excellence, 24-25 January 2011, Singapore, organized by Marcus Evans
• 6^th Philippine Ports and Shipping, 27-28 January 2011, Manila Peninsula, organized by Transport Events Management

SCMAP’s business planning session will be held on January 22-23 outside of Metro Manila.

Address inquiries and comments to Ed Sanchez at tel. 671-8670, fax 671-4793, cell 0918-914-1689, or email dmap@i-manila.com.ph. Those interested in DMAP training and other activities are requested to send their e-mail addresses.

January 15, 2011

SCMAP Perspective #258

Published in Port Calls, January 3, 2011

CASH-TO-CASH

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By Ed Sanchez
SCMAP Executive Director

More than four years ago, in April 2006, I wrote about the supply chain metric called cash-to-cash (C2C) cycle time. I cited that it goes beyond logistics and is more of a financial management metric. It reflects efficiency in the use of money.  I mentioned Dell Computer as an example. In 2004 Dell got paid by its customers 36 days before it had to pay its suppliers!!!

We cited data from M. Theodore Farris (University of Texas) who had written a number of papers on the cash-to-cash metric and had been pushing this metric as the new supply chain management metric. Farris cited the following figures for all US industries from 1986 to 2001.

Element                                    1986                            2001                   Improvement

Accounts Receivable          57.8 days                   61.0 days                 (  3.2 days)

Inventories                            79.5 days                   62.4 days                   17.1 days

Accounts Payable               39.0 days                   51.0 days                   12.0 days

.

Cash-to-cash                          98.3 days                   72.4 days                   25.9 days

Farris further reported the industries with the longest and shortest cash-to-cash cycles.

Longest                      168.3 days                 Construction

Shortest                     (   8.2 days)                Eating and Drinking Places

I am also pushing the cash-to-cash metric for SCM performance. Cash-to-cash cycle time is a financial management metric, but it is also a true supply chain metric. It involves three links in the supply chain.

However, an interesting article has appeared in the latest issue of the Journal of Business Logistics, “A Supply Chain-Oriented Approach of Working Capital Management”, by Erik Hoffman (Univ. of St. Gallen, Switzerland) and Herbert Kotzab (Copenhagen Business School). Their basic conclusion is that collaboration between firms in a supply chain results in more favorable working capital situations than if the firms in the supply chain optimize their own individual cash-to-cash cycles.

The article is somewhat technical. The authors analyzed a database of almost 7,000 companies within the time frame of 1995-2004,

It is not surprising that Dell Computer is cited as the top C2C in 2004 at -30 days (a bit different from the figure cited by Farris, but also tops). The authors also mention the top C2C improving industry sector as restaurants. This corroborates the top rank given by Farris to Eating & Drinking Places

I quote from the authors one of their main findings, “It seems that companies or sectors which implement self-serving working capital initiatives increase C2C cycles at the expense of their up- or down-stream supply chain partners.

I directly quote below the first three main research results stated by Hoffmann & Kotzab. The other results are somewhat technical

The minimization of the C2C cycle from a single company perspective does not add value to all members in a supply chain. A strong company can abuse its power by taking all the working capital improvements, and ethical conflicts may arise when the strong player causes harm to other supply chain members.

• Inventory management does not necessarily represent the only way to reduce tied up capital in supply chains. Instead the synchronization of the goods / material and financial (payment) flows within the supply chain is the key to reducing net working capital and enhancing value for the affiliated supply chain companies.
• The C2C cycle is a powerful instrument to efficiently control and manage the goods / material and financial (payment) flows by tracking inventory, as well as the payment periods within the supply chain

I may have to modify my earlier push for C2C.

Address inquiries and comments to Ed Sanchez at tel. 671-8670, fax 671-4793, cell 0918-914-1689, or email dmap@i-manila.com.ph. Those interested in DMAP training and other activities are requested to send their e-mail addresses.

December 30, 2010

SCMAP Perspective #257

Published in Port Calls, December 20, 2010

UPCOMING ACTIVITIES

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By Ed Sanchez
SCMAP Executive Director

Start of 2011

As SCMAP members rush to meet 2010 targets, SCMAP itself looks forward to its upcoming activities to start 2011.

The calendar for 2011 is still being finalized, but the start of 2011 will include the following.

• Planning session
• Induction of incoming officials
• Launch of newsletter
• Release of revised brochure
• Seminar on Transportation Management

The incoming officials will map out the programs for 2011 at the planning session. Due to scheduling problems, the induction event will move back to February.

The newsletter will include articles and features such as: a story on the 2010 conference, a write-up on the certified logistics master program, an article on the salute to excellence awards, a featured article on the port of Batangas, plus articles on warehouse management, the toll fee increase at SLEX, and supply chain security..

The seminar on Transportation Management will be a new 2-day seminar featuring veteran speakers Ike Castillo, Cora Curay and Dennis Llovido.

In addition to the above SCMAP activities, SCMAP is endorsing two other events.

• Philippine Ports and Shipping 2011, Jan. 17 – 18, Manila, organized by Transport Events Management in cooperation with PPA
• Strategic Sourcing and Procurement Excellence, Jan. 24 – 25, Singapore, organized by Marcus Evans

SCMAP will be sending a second batch of participants in the Logistics Management seminar held every year in Yokohama, through the AOTS of Japan (Association for Overseas Technical Scholarship), in cooperation with JETRO (Japan External Trade Organization).

We already announced the incoming officials last November, but repeat the list below for those who might have missed it.

Elected directors and officers were

• President and Director                    Dennis Llovido                       Nestle Phils.
• Vice President and Director           Cora Curay                              XVC Logistics
• Secretary and Director                    November Canieso-Yeo     Globe Telecom
• Treasurer and Director                    Lito Nepomuceno                 Integrated Commissary
• Auditor and Director                        Rene Casas                              JG Summit
• PRO and Director                               Arnel Gamboa                        Benby Enterprises
• Director                                                  Lloyd Dizon                            Koldstor Centre
• Director                                                 German Martizano               Unilever
• Director                                                 Al Lagera                                  PLDT
• Director                                                 Danny Cabrera                       Zuellig Pharma

Elected committee chairpersons were:

• Remie Co                                          FastCargo Logistics
• Dina Pilapil                                       IDS Logistics
• Gabby Patag                                     TNT Express
• Yhel Reyes                                       GAC Logistics
• Olive Ramos                                     DHL Supply Chain
• Max Yap                                            Oriental & Motolite
• Abbe Daza                                        Omni Logistics
• Marilyn Lauron                                 Getz Bros
• Jet Chua                                            Messe & Handel

Address inquiries and comments to Ed Sanchez at tel. 671-8670, fax 671-4793, cell 0918-914-1689, or email scmap.org@gmail.com.  Those interested in SCMAP training and other activities are requested to send their e-mail addresses. Visit SCMAP’s website at:www.scmap.org

December 18, 2010

SCMAP Perspective #256

Published in Port Calls, December 6, 2010

FELLOWSHIP, STRAT SOURCING

Fax 551-3207

Email lizaalmonte@yahoo.com.ph

By Ed Sanchez
SCMAP Executive Director

SCMAP took a breather from supply chain issues and held its annual Christmas fellowship last Friday at the Makati Sports Club.

Several member companies sent big delegations, with Cora Curay’s “Barangay XVC” topping them all, followed by “Barangay FastCargo” and “Barangay GAC”… Newly elected officials (directors and committee chairpersons) were announced and honored together with outgoing officials. We earlier announced the new officials in the last issue. Re-elected President Dennis Llovido leads the new officials.

SCMAP friends seen at the celebration included Meneleo Carlos (FPI), Jane Ocava (Boeing), Ruth Que (Fast Logistics), Rene Samontan (FastCargo), David James Perez (Handling Innovation), Danny Birog (AsiaGlobal Tech), Dave Alegado (Prime Sales), Louie Villanueva (Snaptech), Sally Go (NMCCLI), Rowena del Rosario (Lorenzo), and some friends from UA&P. Also seen were some past DMAP/SCMAP officials – Bobby Cabaero, Vivian Lim, Norman Adriano, Milo Reyes.

Hanging Issues

As the year ends, shippers will have to contend with the following

• A 2.3% increase in INHTA trucking rates caused by the increase in minimum wage last July
• The 250% increase in SLEX toll fees, where the Supreme Court has already removed all legal obstacles to the increase
• The imposition of VAT on all toll fees
• A proposal for standard weighing scale rates to be used in all ports nationwide. A hearing is set for December 7.
• A previously announced intention to increase rates by PCASO

Strategic Sourcing & Procurement Excellence 2011

SCMAP is again endorsing a Marcus Evans workshop.

SCMAP is pleased to invite its members to attend the Strategic Sourcing & Procurement Excellence conference organized by Marcus Evans, scheduled for January 24 to 25, 2011 in Singapore. The event is supported by SCMAP.

This 2-day conference is designed for all professionals in the procurement and sourcing field to meet and discuss new ideas, solutions, best practices and future directions. It will outline the critical issues and the challenges in procurement today and will focus on creating a successful and resilient procurement functions which will lead to sustainable business.

The event features speakers from General Motors International Operations, China, Beroe Inc, USA, Associated British Foods, Australia, LG Electronics, United Arab Emirates, BT Global Services, Singapore, Unilever, Singapore, Novartis Asia Pacific Pharmaceutical, Singapore, FCI Asia Headquarters, Singapore, Motorola, Singapore, Chevron International, Singapore, to name a few.

Some of the topics to be discussed are Strategic Supplier Selection Process,  Tax Effective Supply Chain Management (TESCM), Supply Chain Integration (SCI), Green Procurement, Enhancing the Use of Technology in Procurement, Global Sourcing Strategies and Streamlining the Procurement Processes and more.

Attendees at this informative event will gain practical insights into: Achieving significant financial savings by aligning procurement procedures with tax strategies; Analyzing the spend of procurement by focusing on cost drivers to increase company’s bottom line; Streamlining the procurement process to improve the business model and the efficiency of operations; Studying global market trends in procurement and how to take advantage of them and Identifying and minimizing risks in procurement

SCMAP members will get a special 10% discount. To avail of this discount, quote “SCMAP-ME” upon registration.. Find out more by contacting Ms. Chew Wan at T: +603-2723-6748 or email LeeC@marcusevanskl.com

Address inquiries and comments to Ed Sanchez at tel. 671-8670, fax 671-4793, cell 0918-914-1689, or email scmap.org@gmail.com.  Those interested in SCMAP training and other activities are requested to send their e-mail addresses. Visit SCMAP’s website at:www.scmap.org

December 4, 2010

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