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Red Lobster food chain goes bankrupt after unlimited shrimp deal

SEAFOOD restaurant chain Red Lobster filed for bankruptcy, succumbing to onerous leases, high labor costs, and a disastrous unlimited shrimp promotion.

The Orlando, Florida-based company filed for Chapter 11 protection on Sunday, listing assets and liabilities of $1 billion to $10 billion each in its bankruptcy petition. The filing allows the company to keep operating while it works out a plan to repay creditors.

Red Lobster plans to hand control of the company to its lenders, led by Fortress Investment Group, who have agreed to provide $100 million in financing to support the chain through bankruptcy. The takeover offer is in the form of a stalking horse bid, meaning it will set the floor price for Red Lobster’s assets and is subject to better bids should any materialize in the coming weeks, according to court documents.   

The restaurant chain had been deteriorating for several years, with diners down around 30% since 2019, Chief Executive Officer (CEO) Jonathan Tibus wrote in court papers. While the business had shown signs of recovery since the pandemic, sales declined sharply in the last 12 months, Tibus wrote. It lost $76 million in the 2023 fiscal year.

Inflationary pressures have kept customers from dining out and higher labor costs strained the company’s finances. A “material portion” of Red Lobster’s leases were priced above market rates. In May 2023, the company changed its $20 “Ultimate Endless Shrimp” from a limited time offer to a permanent promotion, costing it $11 million as diners devoured expensive plates of shrimp.

Red Lobster traces its roots to a single restaurant in Lakeland, Florida in 1968. It expanded rapidly in the 1970s and 1980s, and developed a loyal following for its Cheddar Bay Biscuits. The company now operates more than 550 restaurants in the US and Canada.

The restaurant chain, which has been owned by seafood supplier Thai Union Group Plc since 2020, serves 64 million customers per year and purchases 20% of all North American lobster tails, as well as 16% of all rock lobsters worldwide.

Thai Union and Red Lobster had been in talks with lenders for an out-of-court deal that would hand the creditors 80% of the company, but discussions fell through. Lenders made additional loans worth $20 million to Red Lobster in February, but they weren’t willing to put in more money without support from the owner, according to court papers.

ENDLESS SHRIMPS
Meanwhile, Thai Union disputed the contents of a sworn statement filed in bankruptcy court from Red Lobster CEO Jonathan Tibus, which included allegations that the seafood supplier “exercised an outsized influence on the company’s shrimp purchasing.”

A Red Lobster lawyer read a statement from Thai Union during the restaurant chain’s first bankruptcy court hearing in Orlando, Florida on Tuesday. Thai Union disputes all statements concerning the company and its relationship to Red Lobster, the lawyer said.

Mr. Tibus alleged the decision by former management in May 2023 to change its $20 “Ultimate Endless Shrimp” deal from a limited time offer to a permanent deal cost the company $11 million. The deal also saddled Red Lobster “with burdensome supply obligations, particularly with its equity sponsor, Thai Union,” he said.

Ultimate Endless Shrimp was also heavily promoted in Red Lobster at its locations, which Mr. Tibus said was “atypical for the company” and led to major shrimp shortages at its restaurants. Some Red Lobster locations went days or sometimes weeks without certain types of shrimp, he said.

A former Red Lobster executive also allegedly directed Thai Union to continue producing shrimp for its restaurants “that did not flow through the traditional supply process or bid cycle or adhere to the Company’s demand projections,” Mr. Tibus said. Former management also eliminated other suppliers of breaded shrimp, “leaving Thai Union with an exclusive deal that led to higher costs to Red Lobster,” he said.

The chain employs 34,000 people in the US and an additional 2,000 in Canada. Last week, it shuttered 93 underperforming stores.

The case is Red Lobster Management LLC, number 24-02486, in the US Bankruptcy Court for the Middle District of Florida (Orlando). — Bloomberg

Weak peso brings costs, uncertainty, says Gokongwei

PHILIPPINE STAR/WALTER BOLLOZOS

THE PHILIPPINE peso’s recent weakness against the dollar will bring cost pressures and additional uncertainty to corporates, according to the top official of listed conglomerate JG Summit Holdings, Inc.

“As business people, we don’t like any abrupt changes. The weakening of the peso in the last few days is a little bit fast,” JG Summit President and Chief Executive Officer Lance Y. Gokongwei said at the sidelines of the BusinessWorld Economic Forum 2024 in Taguig City on Wednesday.

“The exchange rate moving down, of course, for a certain of our industries is negative. Definitely, anything abrupt creates more uncertainty and some cost pressures. A lot of the inputs we use are imported — fuel especially,” Mr. Gokongwei added.

The peso ended at P58.27 per dollar on Tuesday, which was its weakest close in over 18 months.

On Wednesday, the local unit rebounded by 21 centavos to P58.06 per dollar.

SUPPORT FOR PETROCHEMICAL INDUSTRY
Meanwhile, Mr. Gokongwei said government support is needed to boost the operations of JG Summit’s petrochemical subsidiary JG Summit Olefins Corp. (JGSOC), which has been hampered by high oil prices and overcapacity. 

“We need to work with the government. We need to develop a manufacturing policy to support vital industries in the Philippines, including the petrochemical industry,” he said. 

“Petrochemicals are the building blocks essential to the manufacture of goods that we use in our daily lives, such as food packaging, clothes, electronic gadgets, vehicles, furniture, appliances, medicines, and a whole lot more. A stable and thriving domestic petrochemical industry will guarantee a steady supply of critical manufacturing ingredients to scale up our manufacturing competitiveness that, in turn, will generate more jobs and create prosperity,” Mr. Gokongwei added.

In January, JGSOC inaugurated a P150-billion expanded petrochemical facility at Batangas City.

JGSOC posted a wider net loss of P3.3 billion in the first quarter from P2.7 billion last year as a result of higher interest expenses, depreciation on new facilities, and foreign exchange losses.

According to Mr. Gokongwei, JGSOC’s operations have been affected by surging oil prices following tensions in Europe, as well as Chinese exports.

“I think we’re really facing double whammy of increasing input prices because of very high oil prices, partially driven by the war in Ukraine. But secondly, there’s rampant overcapacity, including exports out of China for petrochemicals,” he said.

“It’s the single largest investment we’ve made at P150 billion. We do need support and assistance from the government, particularly in looking at illegal dumping and other unfair trade measures,” Mr. Gokongwei added.

Asked on his projection for JGSOC’s recovery, Mr. Gokongwei did not provide a specific timeline but said they will work through the “very tough time” they’re currently experiencing.

“We will work through it. But it’s not going to be easy. It’s a long-term investment, as they say,” he said.

On the other hand, Mr. Gokongwei said Robinsons Land Corp. (RLC) is scheduled to open more properties, such as the five-storey upscale Opus Mall at Bridgetowne District, Quezon City in July.

He also noted the scheduled launch of GBF Towers 1 and 2 office buildings, both in Bridgetowne, as well as the progressive opening of NUSTAR Resort & Casino in Cebu by the third and fourth quarters.

Mr. Gokongwei also serves as RLC’s chairman, president, and CEO.

“We’re trying to grow across all fronts. We have various businesses spanning malls, offices, hotels, logistics, and destination estates,” he said.

On Wednesday, JG Summit fell by 1.2% or 40 centavos to P33.05 per share. — Revin Mikhael D. Ochave

Building a kitchen with Ikea

DURING a tour around the Ikea store’s kitchen department late last month, guests got a view of the possibilities of the Metod and Enhet kitchen systems.

The Metod kitchen straddles the line between traditional and minimalist, while the Enhet kitchen is more affordable and meant for more compact homes. Both of them are available through a series of cabinets and doors.

It sounds overwhelming, but we were also introduced to the Ikea planning system, accessible through IKEA.ph/kitchen. Here, one can book a session online via video call or in-store at the Planning Studio, where kitchen planning experts can help a shopper sort out their kitchen preferences (and help set a budget). They will ask for your kitchen measurements and preferences. After a plan is drawn up, one can pay at the check-out counters or online.

Kitchen installation services are available in the Greater Manila Area and Metro Cebu. Ikea Family members get a 10% rebate through Ikea Gift Cards for a minimum purchase of P150,000 on Metod kitchens in-store from May 1 to June 2; 0% installment payment plans up to six months are also available for a minimum purchase of P20,000 for BDO, BPI, HSBC, Unionbank, and Metrobank credit card holders. There is a 25-year guarantee on the Metod kitchens that covers defects in the material and workmanship and a 10-year guarantee for the Enhet kitchen system, while Ikea appliances have a five-year guarantee.

Finally, to complete the kitchen experience, Ikea gave us a few recipes that one can do with the food available at their stores:

Ikea Veggie Ball Salad
Veggie Balls (available frozen at Ikea)

Salad Vegetable mix

Onions

Tomatoes

1 red onion, chopped

Avocado

Feta Cheese

Salted Egg

Procedure:

Cook veggie balls in a pan, grill, or in the oven for two to four minutes until golden-brown.

Mix all ingredients in a bowl, add some olive oil or any other dressing.

Kinilaw na Salmon
4 pieces fish fillet ASC Salmon, 500 gm (available frozen at Ikea)

1/4 cup vinegar for washing

1/3 cup vinegar (can be spiced)

1 red onion, chopped

2 tablespoons of ginger, sliced into fine strips or small cubes

4 tablespoons of calamansi juice (lime or lemon may be substituted)

salt and pepper to taste

Procedure:

Get a bowl and combine the cubed fish and 3/4 cup of vinegar. Mix them well and let them stand for two minutes.

Drain the vinegar while lightly squeezing out the fish cubes — this will help reduce the fishy smell.

Combine all the remaining ingredients, and gently toss until well-blended.

Cover and place in the fridge for at least 30 minutes (the Ikea recipe comes with a warning that too much time soaking in the fridge might “overcook” the fish in the acids, but a maximum of up to three hours is allowed).

Serve chilled. — JLG

Philippines’ top fintech GCash eyes 2025 IPO, chairman says

BW FILE PHOTO

GLOBE TELECOM Inc.’s popular financial technology (fintech) app GCash may go public in the Philippines next year as it keeps the door open for new investors and an overseas listing.

“We want to do it sooner rather than later. Sometime in 2025 would be the best estimate I can give you,” Globe CEO Ernest Cu said in an interview on Wednesday. Mr. Cu chairs Globe Fintech Innovations Inc., or Mynt, the holding company of GCash and the entity that will do the initial public offering (IPO).

While the preference is to go public in the Philippines, Mr. Cu said the group is studying a dual listing, with the second IPO possibly in the US. “The rationale is trying to take advantage of the liquidity in the US market,” he said, citing limited trading volumes in the Philippines.

Mr. Cu declined to say the valuation that Globe is seeking for GCash and the amount that the company hopes to raise from the IPO. Mynt was valued at more than $2 billion after its last funding round in 2021.

While there’s no urgency for an IPO since GCash — which has 94 million users — is still growing and profitable, Mr. Cu said the company has “investors who would like to see some liquidity, so we may have to do it at some point.”

Globe owns around 35% of Mynt, while China’s Ant Group has about 34% stake, Mr. Cu said. Other investors include Warburg Pincus, Bow Wave Capital and Ayala Corp. Ant may hold on to its interest if Globe goes ahead with the GCash IPO, he added.

Ahead of the IPO, GCash has received “a lot of interest” from foreign funds, financial institutions and private investors to invest in the company. “The valuations are good so there’s temptation,” Mr. Cu said. “We are not ruling it out entirely.”

GCash forms part of Globe’s drive to become a tech-centric enterprise, diversifying from its maturing core telco business.

“There’s this paranoia that we have that one day this will plateau,” Mr. Cu said of the company’s telco revenue in an interview with Bloomberg TV’s David Ingles and Stephen Engle earlier on Wednesday. “Growth all over the world as far as telco revenues have been challenged. I think it’s no secret,” he added.

Globe reported a 3% increase in first-quarter service revenue to P41.1 billion ($708 million), the same growth it posted for all of 2023. But Globe’s share in Mynt’s equity earnings more than doubled to P962 million, representing 11% of its pre-tax income.

The company, which counts Singapore Telecommunications Ltd. and Philippine conglomerate Ayala Corp. as major shareholders, is also looking at sectors like healthcare and “others that we can sort of effect through digital means,” he said.

“Our fintech business, while profitable and growing tremendously, is still far behind in terms of revenue,” Mr. Cu said. — Bloomberg

Dining In/Out (05/23/24)


Celebrate Tea and Biscuit Days with M&S

WHILE International Tea Day on May 21 may have ended, it’s never too late to dunk a biscuit on National Biscuit Day on May 29, with treats from Marks & Spencer (M&S). The latest M&S flavored tea infusions are meant to please, whether hot for high tea or cold for summer days. Flavors available include Mango Pineapple, Lime and Raspberry Lemonade, and unique M&S Sticky Toffee Rooibos Infusion. As for National Biscuit Day, those who prefer a more traditional treat can look to the Outrageously Chocolatey Rounds, always in season. Other cookies are also available, with options that include chocolate, fruit, oats, or nuts. The teas and biscuits are available in Marks & Spencer’s 20 stores nationwide.


NWR has drink promos and live music

NEWPORT World Resorts (NWR) has several happy hour promos like 2-plus-1 San Miguel draft beers at Bar 360, El Calle Food and Music Hall, and The Grand Bar & Lounge between the hours of 6 and 9 p.m. this May. Forty drink selections await at The Whisky Library from 5 to 8 p.m. Meanwhile, Bar 360 at the G/F Newport Garden Wing plays host to a wide range of musical acts from pop to classic rock. Over at the second floor, the El Calle Food & Music Hall lends the stage to some of the metro’s acoustic acts. At the Newport Grand Wing, The Grand Bar & Lounge sets the vibe with groovy music and a classic Manila beat. For more information, visit www.newportworldresorts.com and follow @newportworldresorts on Facebook and Instagram, and @nwresorts on Twitter.


Nestlé relaunches Homebakers Club

NESTLÉ All Purpose Cream announced the upcoming relaunch of the Nestlé Homebakers Club, a virtual community designed to empower home bakers and enthusiasts to deepen their baking expertise and turn their passion and kitchen knowledge into a business of their own. The club’s inaugural virtual event series, “Bake to Basics,” premieres on May 23, following closely on the heels of World Baking Day (May 17). The event will feature a Facebook Live session hosted by chef Jackie Ang-Po, in collaboration with home baker and business owner Kathy Apole-Sarmiento. The session will cover essential baking techniques, gaining insights into starting a home baking business, and discovering the secrets to success in the industry. “Baking has the power to bring people together and ignite creativity,” said Ms. Ang-Po. The club offers a wide range of benefits, including access to exclusive content, online classes, expert advice, weekly challenges, and networking opportunities with industry professionals and fellow home bakers. Members will also have the chance to participate in the club’s offline events and activities, showcasing their skills and creations to a wider audience. Members can also initiate their own activities like meet-ups and sharing of culinary creations for mutual appreciation and constructive feedback. “Nestlé Homebakers Club is both a community and platform on baking and business for home bakers of varying levels to connect, learn, and thrive. We are committed to providing members with the resources and support they need to succeed. Whether you’re a seasoned baker or just starting out, Nestlé Homebakers Club is your go-to destination for inspiration, education, and collaboration,” said Carina Faustino-Dy, Senior Brand Manager of Nestlé All Purpose Cream. To join the launch on May 23, visit https://www.facebook.com/NestleHombakersClub.


DQ offers ube treats in May

DAIRY Queen’s (DQ) latest “Blizzard of the Month” offering is the Ultimate Ube collection, featuring seven treats available for a limited time only. The traditional combo of ube — purple yam – and cheese with the new Ube Cheesecake Blizzard, made with DQ’s signature soft serve mixed with real ube and bite-sized bits of cheesecake, and then topped with a ball of ube. Then there is the new Ube Fluff Blizzard, made with real ube and mini marshmallows mixed into soft serve, topped with a ball of ube and more mini marshmallows. Rounding off the new Blizzard flavors is the new Ube Crunch Blizzard, made with real ube and crushed graham crackers mixed into soft serve, which is then topped with a graham cracker and a ball of ube. The other items in the collection are: Purple Dream Parfait, made with ube topping between layers of soft serve, topped with cookie crunch and a ball of ube; the new Ube Classic Milk Shake, with soft serve blended with milk and real ube, and then topped with whipped cream; the new Purple Cloud Tin Cake, made with soft serve mixed with real ube, all resting on a cake crunch base/crushed Oreo base, which is then topped with white and purple frosting and mini marshmallows; and the new Purple Fudge Cheesecake, made with a cake crunch center, crushed Oreo base, and soft serve mixed with real ube and cheesecake bits, finished with purple frosting and ube topping and cheesecake bits. The Ultimate Ube Blizzards are available in mini, regular, medium, and large starting at P99. The Ube Classic Milk Shake is available in 12 and 16 oz servings starting at P169, while the Purple Dream Parfait is priced at P169. The Purple Cloud Tin Cake is priced at P439, while the Purple Fudge Cheesecake, available in 6- and 8-inch variants, starts at P749.

PHINMA gets funding to boost education unit

DEL ROSARIO-LED PHINMA Corp. has received additional funding from global investment company KKR & Co., Inc. to support its education unit.

PHINMA Education Holdings, Inc. has signed an investment agreement with Phoenix Investments II Pte. Ltd. and Rise Edu Pte. Ltd. on May 21, PHINMA Corp. said in a stock exchange disclosure on Wednesday.

The investment agreement covers the issuance of P4.5 billion worth of newly issued shares by PHINMA Education.

Phoenix Investments is an investment vehicle of funds managed by KKR, while Rise Edu Pte. Ltd. is an investment vehicle of funds managed by Kaizenvest, an education-focused private equity fund focused on emerging markets in South and Southeast Asia.

Meanwhile, KKR-managed funds also entered into an agreement to acquire all of PHINMA Education shares owned by Asian Development Bank (ADB), Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden N.V. (FMO), and Kaizen Private Equity II Pte. Ltd. (Kaizenvest II), who all invested in the subsidiary in 2019.

PHINMA Corp. currently owns 75.01% of subsidiary PHINMA Education.

“Following completion of the primary transaction and secondary transaction mentioned above, funds managed by KKR and Kaizenvest III will respectively own, directly or indirectly, a 30.67% and 3.73% stake in PHINMA Education,” PHINMA Corp. said.

“Meanwhile, ADB, FMO, and Kaizenvest II will no longer be, directly or indirectly, shareholders of the PHINMA Education,” it added.

The deal is expected to close by the third quarter, subject to the approval of the Philippine Competition Commission. PHINMA Corp. will remain as the majority shareholder of PHINMA Education after the transaction.

“We are fortunate to have an investor of KKR’s quality to help us make the lives of the underserved youth in Southeast Asia better. Their investment will support our ability to scale our systems, enter new markets, and empower our students to achieve the future they want and deserve,” PHINMA Education President and Chief Executive Officer Chito B. Salazar said in a separate statement.

Under the investment agreement, KKR will be entitled to three out of 11 PHINMA Education board seats.

“We will look to leverage KKR’s deep experience investing in education companies globally to support the management team’s vision to scale the company and become a leading education platform across Southeast Asia,” KKR Managing Director and Head of Global Impact for Asia-Pacific George Aitken said.

PHINMA Corp. shares closed unchanged at P20.45 apiece on Wednesday. — Revin Mikhael D. Ochave

India’s butter chicken battle heats up with new court evidence

THE RECIPE of Moti Mahal’s “Signature Butter Chicken” can be found on its website. — MOTIMAHAL.IN

NEW DELHI — With new photographic and video evidence, an Indian court battle over the origins of the world-famous butter chicken is set to get spicier.

Two Indian restaurant chains have been sparring since January at the Delhi High Court, both claiming credit for inventing the dish in a lawsuit that has grabbed the attention of social media users, food critics, editorials, and TV channels across the globe.

The popular Moti Mahal restaurant chain said it had the sole right to be recognized as the inventor of the curry and demanded its rival, the Daryaganj chain, to stop claiming credit and pay $240,000 in damages. Moti Mahal said founder Kundan Lal Gujral created the cream-loaded dish in the 1930s at an eatery in Peshawar, now in Pakistan, before relocating to Delhi.

That “story of invention of butter chicken does not ring true” and is aimed at misleading the court, Daryaganj said in a new, 642-page counter-filing reviewed by Reuters.

Daryaganj says a late member of its founding family, Kundan Lal Jaggi, created the disputed dish when he helmed the kitchen at the relocated Delhi eatery, where Mr. Gujral, his friend-cum-partner from Peshawar only handled marketing.

Both men are dead, Mr. Gujral in 1997 and Mr. Jaggi in 2018.

Evidence in the non-public filing includes a black-and-white photograph from 1930s showing the two friends in Peshawar; a 1949 partnership agreement; Mr. Jaggi’s business card after relocating to Delhi and his 2017 video talking about the dish’s origin.

By virtue of the friends’ partnership, “both parties can claim that their respective ancestors created the dishes,” Daryaganj says in the filing, calling the dispute a “business rivalry.”

Moti Mahal declined to comment. The judge will next hear the case on May 29.

A key point of contention, which the court will have to rule on, is where, when, and by whom the dish was first made — by Mr. Gujral in Peshawar, Mr. Jaggi in New Delhi, or if both should be credited.

Butter chicken is ranked 43rd in a list of world’s “best dishes” by TasteAtlas, and bragging rights about who invented it can matter, brand experts said.

“Being an inventor has a huge advantage globally and in terms of consumer appeal. You are also entitled to charge more,” said Dilip Cherian, an image guru and co-founder of Indian PR firm Perfect Relations.

Moti Mahal operates a franchisee model with over 100 outlets globally. Its butter chicken dishes start at $8 in New Delhi, and are priced at $23 in New York.

Late US President Richard Nixon and India’s first Prime Minister Jawaharlal Nehru are among the famous clients to have visited its primary outlet in Delhi.

Daryaganj started in 2019 and its butter chicken costs $7.50. It has 10 outlets, mostly in New Delhi, with plans to expand to other Indian cities and Bangkok.

In its 2,752-page Indian lawsuit, Moti Mahal had also accused Daryaganj of copying “the look and feel” of the interiors of its outlets.

Daryaganj has retorted with photographs of restaurant interiors which the judge will review, claiming it is Moti Mahal that has copied its “design of floor tiles.” — Reuters

Customer satisfaction is paramount

FREEPIK

Last week I wrote about how a fast-food branch at the corner of Valero and Dela Costa failed me as a customer given the store’s seeming over-reliance on technology at point of sale. What ailed my customer journey at that specific store was how the automated ordering system resulted in a “disconnect” as it could not explain delays in my orders, not once but twice, in the same afternoon.

I surmised that technology failed where human intervention became necessary in the process. As I noted then, the use of technology in any operation is assumed to result in efficiency. But I also mentioned that humans cannot be completely removed from the process, and that such intervention should not wait until after a problem arises.

Of course, the fast-food company is not in any way at risk of losing me as a customer. I am its market, obviously. I go there often enough. However, another incident this week — this time at the drive-through of its branch in Greenbelt — indicates to me that perhaps it is about time that the company reminds its staff of the value of customer service, especially when technology “fails.”

Tuesday lunch time I entered the drive-through at around 11:49 a.m. and made my way to the point-of-sale (POS) terminal. Almost at once, the voice on the other end politely told me to wait. There were maybe eight cars ahead of me, with one at the cashier. After about five minutes, I made my presence felt, and the voice at the other end again politely told me to wait. Twice I was told to wait, without any explanation as to why. By then, there may have been about six cars behind me.

The trouble with situations like this, given the information vacuum, cars behind me might begin to think that I am the cause of the delay as I was at the POS at the time. I believe effort should have been made to inform all in line why it was not moving for about 10 minutes. Finally, at 11:59 a.m. — 10 minutes after I entered the drive-through — the voice at the other end took my order.

In drive-through terms, as any fast-food operator would appreciate, a 10-minute wait to order is an “eternity.” I suspect it would have been faster for me to have gone down, walked to the counter, and ordered in-store. Anyway, at 11:59 a.m., my order was taken, with just one car ahead of me in line. It took another four minutes for me to reach the cashier. I paid at 12:03 p.m.

The payment process took less than minute, but even then, no explanation was offered for the 10-minute delay in taking orders. I did not bother to ask why, recalling my experience at the Valero store just a week before. Anyway, I picked up my order at the last window at 12:05 p.m. In all, the process should have taken maybe four minutes from ordering to pick up. Instead, it took 16 minutes — too long for any drive-through.

With the way the Greenbelt drive-through is built, once you enter, you cannot back out. There is simply no way to leave the line. In short, with or without delays, you will just have to go through the process until you can exit, satisfied or not. The least that the staff could have done was to offer some explanation for the delay — whether via voice or through the ordering terminal’s monitor.

I suspect either the system went down temporarily or there was a reboot. I checked my receipt and it indicated that my order was processed at the window at “11:53 a.m.” However, the credit card charge slip indicated “12:03 p.m.,” while my own watch — based on network time — also indicated “12:03 p.m.” as payment time. In short, the fast-food company’s system indicated a 10-minute lag time in the receipt, which coincided with my waiting time in front of the POS terminal.

Why didn’t the staff — the voice at the other end — offer some explanation for the delay, rather than just politely asking the customer to wait, not once but twice? And this is where, in my opinion, like in the case of the Valero store a week before, “disconnect” occurs. Customer satisfaction could have been improved by the offer of an explanation. Was this a training “failure”? Or the customer’s satisfaction is simply taken for granted?

As I wrote previously, in most cases, technology aims to simplify tasks. But it can sometimes introduce complexity especially after points of failure. In this case, I believe that human behavior was the bottleneck that resulted in poor customer satisfaction. There was a lack of recognition of the need to explain the process delay to the customer, who was left in the dark as to what was happening. In some cases, this neglect can result in confusion, dissatisfaction, maybe even anger and frustration.

The task of managing customer expectations fell through the cracks, as there was no way for the POS or ordering system, on its own, to directly inform or explain to the customer the cause of delay. Perhaps the POS monitor could have been used by the store manager to send out a short message as an explanation that can be viewed by the customer waiting in the car. Or the “voice” at the other end could have done the same. Missed opportunities.

So, unless the customer complained or asked about the delay, the store would have been unaware of the degraded customer experience. Or maybe it was aware but just did not care. In this line, one cannot overemphasize the need for staff training particularly in adverse or “crisis” situations. A system reboot, downtime, or other unintended or unforeseen mishaps should be explained immediately to customers in all ways possible — either directly by staff or by any available communication channel.

There is no shame in admitting mishaps or adverse incidents. They occur in any operation. What matters, however, is how businesses immediately deal with such situations, and how quickly necessary information is conveyed to customers during the customer journey. Information vacuums should be avoided. Customer satisfaction is always paramount, and care must always be exercised to ensure it.

 

Marvin Tort is a former managing editor of BusinessWorld, and a former chairman of the Philippine Press Council

matort@yahoo.com

WMPC awaits ERC approval for new contract

ALSONS POWER Group’s Western Mindanao Power Corp. (WMPC) is waiting for approval from the Energy Regulatory Commission (ERC) for its new contract as its fuel supply is set to run out in the coming weeks.

WMPC, its diesel power plant in Zamboanga City, will be exhausting its fuel supply in the coming weeks and may need to stop its operations after its non-firm ancillary services procurement agreement (ASPA), which enabled it to provide power supply to the city, expired on April 25, Alsons said in a statement on Wednesday.

Ancillary services are tapped by grid operators to support the transmission of power from generators to consumers to maintain reliable operations.

Under a non-firm ASPA, power plants are not guaranteed to provide ancillary services to the power grid at all times, Alsons said.

In April 2023, the National Grid Corporation of the Philippines (NGCP) awarded WMPC a new firm ASPA, but its implementation is currently on hold pending approval from the ERC.

“Unless the ERC approves our ASPA, we will lack the necessary funds to recover our losses and procure fuel for the continued operations of WMPC,” WMPC Vice-President and Business Manager for Plant Operations Jose Luis R. Angco said.

He said the company may incur “unrecoverable losses” without an approved and acceptable ASPA, which would affect its ability to replenish its fuel stock.

According to Alsons, Zamboanga is 270 kilometers away from the nearest base load power station and without the power support that only WMPC can provide, the voltage in the city will drop to unsustainable levels. This may lead to power fluctuations or outages, especially during peak hours, it said.

“Currently, WMPC operates as a must-run unit participating in the Wholesale Electricity Spot Market. However, this setup is not sustainable,” Mr. Angco said.

He said the company may incur significant losses when the plant may be dispatched for voltage correction at a reduced rate of between P3-6 per kilowatt hour.

“We aim to continue providing the necessary ancillary services to support NGCP in ensuring a sustainable power supply in Zamboanga all throughout the year,” he said, adding the ASPA approval is crucial for the power plant to continue its operations and allow it to recover costs.

“We evaluated the WMPC ASPA earlier this morning, among others, and expect to issue our action in the next few days,” ERC Chairperson and Chief Executive Officer Monalisa C. Dimalanta said in a Viber message on Wednesday when sought for comment. — S.J. Talavera

Academic programs seen to help address workforce gap in cybersecurity sector

By Aubrey Rose A. Inosante

CYBERSECURITY electives offered in universities and colleges are not enough to fill the lack of experts in the field in the Philippines, industry officials said.

“We have not been able to produce a lot [for our] workforce because our academe does not provide degrees in cybersecurity. Instead, what they are doing is offering it as an elective,” Allan S. Cabanlong, Regional Director for Southeast Asia at Global Forum on Cyber Expertise, said in a Viber message.

Certification bodies like the Cybersecurity and Infrastructure Security Agency, Certified Ethical Hacker Certification, Computer Forensics and Security Institute, and more drove the number of sector professionals, he said.

However, certification, which can be obtained in a few weeks, does not guarantee a student will possess operation knowledge, he added.

The demand for cybersecurity practitioners is at an all-time high amid rising online attacks, with recent schemes even targeting government agencies.

According to the National Association of Data Protection Officers of the Philippines, about 180,000 professionals are needed in the country.

“Singapore has about 2,000 cybersecurity professionals, and the Philippines has about 200. And of the 200, 80 percent of that are working abroad,” said Department of Information and Communications Technology (DICT) Secretary Ivan John Uy earlier said.

Mr. Cabanlong said an ideal setup for Philippine schools offering cybersecurity programs is to have partnerships with foreign academic institutions and private firms for on-the-job training,

“If someone wants to offer cybersecurity — whether it’s cybercrime investigation, network security, cyber defense, or cyber diplomacy — the basics of it or the advanced part of it, or the executive courses, they should already have guidelines,” he said.

Mr. Cabanlong was a former DICT assistant secretary. During his tenure, the agency forged a partnership with AMA University in 2018 to offer a Bachelor of Science in Cybersecurity.

Among other educational institutions offering are BS Computer Science elective in Cybersecurity at the Ateneo Davao University, St. Paul University, Mapua, and a Masters in Cybersecurity at Holy Angels University.

University of the East (UE) Caloocan recently announced it will offer a four-year BS Criminology program with specialized cybersecurity courses.

Michelle Concepcion, dean at the UE College of Arts and Sciences (CAS), said the university has a pool of information technology (IT) and criminology experts equipped to teach its cybersecurity and criminology courses for the program.

“The university has eight IT laboratory classrooms equipped with computers and software apps for cybersecurity specialization courses such as cyberspace and cybersecurity, information assurance and security, network and data communication protocols, digital forensics, machine learning in security, and security penetration testing and audit,” Ms. Concepcion said in a Viber message.

UE targets to get 100 to 200 enrollees for the degree’s pilot academic year, she said.

UE CAS Caloocan aims to produce graduates who are competent and will uphold strong ethical standards in delivering services including crime prevention, detection, investigation, law enforcement, public safety, custody, offender rehabilitation, and criminological research, she added.

Digital Pinoys National Campaigner Ronald B. Gustilo however noted that these specialized courses are mostly in private institutions and relatively have high tuition fees.

“The government needs to allocate funds to state colleges and universities (SUCs) so that they will be able to offer cybersecurity and information technology courses. The state should improve the facilities of SUCs and hire professionals who will teach students,” he said.

ICT ACADEMY
Under the National Cybersecurity Plan, setting up an ICT academy and a Cybersecurity Center of Excellence is one of the strategies to produce more cybersecurity experts.

The DICT targets to produce 300,000 cybersecurity professionals by 2028.

DICT Undersecretary for Infostructure Management, Cybersecurity, and Upskilling Jeffrey Ian Dy said these facilities are targeted to be established informally within the year.

“However, institutionalizing an academy needs an enabling law. We will advocate for its establishment as part of the cybersecurity bills pending in Congress,” he said in Viber message.

The agency provides partial scholarships and offers online and computer-based training for students. It recently gave out 500 Google Cybersecurity Certifications provided through the agency’s learning management system, Mr. Dy said.

“With Microsoft, we have an agreement on sharing of intelligence and training of our National Security Operations Center personnel,” he added.

Australian food icon Kylie Kwong quits industry after 24 years

CHEF Kylie Kwong and food writer and TV host Nigella Lawson inside the Lucky Kwong restaurant. — FACEBOOK.COM/KWONGKYLIE

AUSTRALIAN culinary legend Kylie Kwong will quit the food industry and shut her popular Sydney restaurant at the end of June.

Ms. Kwong, founder of Australian-Cantonese restaurant Lucky Kwong, is set to retire from her restaurateur career after 24 years in favor of social enterprise pursuits, she said in an Instagram post Monday.

“Through the lens of food and interconnectedness, I wish to place all my energy, focus and time into helping share and amplify other people’s stories, particularly the important voices of First Nations people and our multicultural communities,” she wrote.

Lucky Kwong is the latest in a string of high-profile Sydney restaurant closures, as factors including rising costs hit diners and venues alike. — Bloomberg

Iran’s President Raisi was a failure

EBRAHIM RAISI — COMMONS.WIKIMEDIA.ORG

ALL IRANIAN PRESIDENTS since the early 1980s have in essence been expressions of what the supreme leader thought he needed at the time. Ebrahim Raisi was not only a protégé of Ayatollah Ali Khamenei, but also closer in his purist religious and political views. So it matters that at home — where the future of the regime will ultimately be determined — the man chosen to restore faith in and obedience to the Islamic Revolution failed.

Raisi came to power in 2021, claiming that Iran didn’t need a by-then-defunct nuclear deal with the West and could prosper by facing its “resistance economy” squarely to the east. He also quickly imposed a crackdown on female dress codes, in a demonstrative turn to a past where his revolutionary credentials — as “the Butcher of Tehran,” responsible for mass executions of regime opponents in 1988 — were impeccable.

By the time of his death in a helicopter crash on Sunday, however, both policies had proved disastrous. There were fireworks in the streets of Tehran, as some celebrated an unloved president’s demise.

Even Raisi’s election success in 2021 was, in reality, a sign of failure. It was the first presidential vote to produce no benefit whatsoever as a tool of legitimation for Khamenei, at a time when the 40-year-old revolution’s appeal has faded. Raisi had lost to a less hardline regime member — former President Hassan Rouhani — in 2017. He was able to succeed four years later only after the Khamenei-dominated Guardian Council had disqualified all other candidates of any promise, so as to ease his path. The result was the lowest voter turnout on record.

One of Raisi’s earliest decisions was to order a crackdown ostensibly to ensure female modesty and chastity. That resulted in the death, just weeks later, of 22-year-old Mahsa Jina Amini, an ethnic Kurd arrested for not wearing her hijab in the dictated manner. The protests that followed were the largest in the history of the Islamic Republic, posing the greatest domestic threat to the regime’s survival since the revolution. As I’ve written before, it took brutal repression in the streets, killing hundreds, as well as the distraction of Gaza to contain Iran’s Woman, Life, Freedom movement.

The threat to Khamenei came not just from the scale of the protests, but in part because it was so clear that Raisi was no more than a cypher for the Supreme Leader. Unlike most previous protest movements — and Iran has had many since 2008 — this one openly challenged the ideals and legitimacy of Khamenei and the Islamic revolution itself.

Raisi did no better on the economy. Despite a significant rise in oil exports as the US eased sanctions enforcement and a large boost to government spending, the International Monetary Fund projects Iran’s economy to grow by 3.3% this year. That may sound healthy enough, but it’s a poor outcome that signifies declining living standards, given the high pace of inflation.

According to Iran’s central bank, consumer prices rose 42.7% year over year in the first quarter of 2023, the latest data it reports, with food (53%) and restaurants and hotels (68%) the hardest hit. In other words, the poor are finding it harder to eat, and the middle classes are finding it harder to eat out.

Yet totalitarian regimes don’t need their populations to be content, so long as they have security forces willing to kill to suppress dissent. At the same time, Russia’s setbacks in Ukraine and US troubles in the Middle East have shuffled the global order in Iran’s favor. As Russia, cut off from the West, seeks new markets and sources of arms to sustain its war, Iran has stepped forward, solidifying its position in an emerging coalition of autocracies that includes China, Russia, and North Korea. 

I recently heard this bloc dismissed as an “alliance of jerks,” but I think that’s both arrogant and misleading. The coalition has broken Iran’s international isolation and has considerable appeal in the so-called global south. China’s presence also ensures the prospect of economic and technological sustainability for its pariah partners. Add to that the sea change in international opinion that’s being caused by Israeli actions in Gaza and you have an Iranian regime that’s infused with new confidence.

Raisi, certainly before he died, seemed unfazed by the turmoil he had caused with his crackdown on women. With the streets calm again, he had sent the morality police back out to enforce the hijab rules. “We believe that the enemy is pursuing the agenda of undermining modesty,” he said in a May 7 interview on Iran’s Network One TV. “Our religious people will not allow the enemy to achieve its goal.”

Even so, the reliance of Khamenei and his idea of Iran’s destiny on security forces at home and abroad has increased the power of the Islamic Revolutionary Guard Corps (IRGC) over the last decade, whose businesses have stepped into the sanctions void created as Western companies have withdrawn. It’s no coincidence that Raisi’s deputy, Vice-President Mohammad Mokhber, is a former IRGC officer and head of Khamenei’s vast commercial enterprise, known as Setad. Mokhber also took part in the negotiations with Russia over Iran’s supply of loitering munitions.

Khamenei has already confirmed Mokhber’s constitutionally mandated move to the post of interim president, ahead of a snap election that should be held within 50 days. That by no means makes him frontrunner or perhaps even a candidate for the presidency, but Raisi’s death has opened new possibilities on succession to the only job that really matters, that of supreme leader.

The coming presidential vote will, once again, have no value as an exercise in popular choice, but it will be important to the regime factions already jostling for the succession. Not even those involved know how that will pan out, let alone me. But it’s hard not to conclude that Raisi’s death, after such an unsuccessful experiment in ideological purity, will have weakened his camp and strengthened that of the IRGC. They, too, are deeply loyal to Khamenei, and their rise would likely promise an equally aggressive Iranian regime, albeit one that’s a little less prone to self-harm at home.

BLOOMBERG OPINION