By Bjorn Biel M. Beltran
Special Features Assistant Editor, BusinessWorld
It is often the consumers who bear the brunt of the impact of any major global crisis. In the coronavirus pandemic, thousands of Filipinos have lost their livelihoods as the economy halts due to quarantine, while thousands more are laid off or are unable to go to work.
In an effort to encourage companies to aid in the plight of their consumers, the Philippine Marketing Association, through a Facebook live event, recently gathered the country’s business and industry leaders to give an overview of the Philippine value chain to ease consumer needs during the COVID-19 (coronavirus disease 2019) crisis.
An understanding of the supply chain and how the economy depends on it is essential, as the Enhanced Community Quarantine (ECQ) which has put the entirety of Luzon on lockdown, is affecting the flow of goods in and out of the country.
Marilyn Alberto, president of the Philippine Multimodal Transport and Logistics Association, Inc. and director and general manager for Kintetsu World Express, pointed out that the country’s ports are at risk of congestion due to the challenges brought about by the lockdown.
Working on a limited workforce, customs processes are experiencing significant delays. And while the government has been quick to impose measures to closely monitor the prices of farm and fishery products, processed goods, and medicines sold in Metro Manila and other urban centers nationwide, as more companies accumulate storage charges on their goods, these higher costs may be passed on to consumers in the future.
“The best way (to avoid this) is to consider how you can reduce transportation and logistics costs moving forward,” she said, urging companies to seize shipping consolidation opportunities, to maximize their trips to avoid ‘empty miles’ by collaborating with each other, and ensure smarter planning and coordination between procurement and distribution.
Ms. Alberto further urged the government and regulators to continue policies to ensure the free flow of goods across the country. For the long-term, better IT capabilities such as automated processing of permits and clearances would also solve future delays.
“We all need these efficiencies so that we can further lower our costs. Only with lower costs and efficiencies can we help our consumers,” she said.
Sharing the perspective of essential businesses, Marvin Tiu Lim, president of the Philippine Association of National Advertisers and vice-president for Sales and Marketing of Mega Global Group, pointed out that the stress of spikes in consumer demand is another challenge worth noting.
“We have problems in our canning plants. We have two kinds of plants producing upwards of 2.5 million cans per day. Right now, we’re only producing up to a million because of the lack of manpower that we are experiencing,” he said.
Much of Mega Global’s measures have been focused on keeping their products on the shelves, available for all Filipinos. Mr. Lim said that the company’s crisis management plan have been calibrated to ensure maximum capacity, unhampered logistics, and on-time delivery of goods, all while shifting its sales marketing strategies online.
“What are we doing now to ease consumer needs during this crisis? So number one, we provide assurance to everyone to the whole country that our basis is continuing,” he said.
“We are reaching out to our consumers by understanding their worries and pain points now. We need to make sure that we are always online, we are always checking the pulse of our consumers. And the most important is that we have to ensure our products are still on the shelves.”
The freedom of digital platforms amid lockdown
With consumers forced into their homes, many have turned to online solutions for their needs. Francis Reyes, Group CFO of Landers & Popeyes Group, saw traffic of their online portals spike by as much as 800% in the past weeks.
“Definitely there’s a sudden shock that the market has experienced and it has led to panic buying,” he said.
Having capable online platforms helped meet this demand, complete with delivery solutions, and fulfillment processes to Landers members. Mr. Reyes said that the real bottleneck, however, is in terms of the people working their stores.
“We have to improve our system by making sure that everyone who is working from home, all the infrastructure specialists are there to ensure that we sustain operations,” he said.
Atty. Paul Santos, chairman of the Philippine Retailers Association and president of Picture City, added that as many consumers all over the world become fearful of the coronavirus, digital solutions will become ever more essential.
“Moving forward, a lot of non-food retailers, especially those in modern retailing, will have to rethink their current online strategies. That’s about the only selling channel that’s moving for that particular sector. For those retailers who haven’t yet implemented one, or have yet to invest substantially in that sales channel, I think now is the time. Now’s the time to do it,” he said.
Ken Lerona, head of Marketing & Corporate Communications at Entrego, further noted that the pandemic has proven that Philippine businesses are ready to serve consumers digitally, as long as there is sufficient infrastructure to support such growth channels.
“What’s interesting is that from the situation that we’re in right now, we are seeing that the e-commerce strategy is really seeing major, major growth because of the demand. It’s definitely a reality that we’re facing right now,” he said.
“Our country is ready. It’s only a matter of making that end-to-end line seamlessly integrated,” he added.