Firms urged to boost IT contingency plans after global tech outage

July 22, 2024 | 12:31 am

The CrowdStrike logo is being displayed on a smartphone in this photo illustration in Brussels, Belgium on July 19, 2024. — JONATHAN RAA/NURPHOTO VIA REUTERS CONNECT

By Luisa Maria Jacinta C. Jocson, Reporter

THE GLOBAL tech outage caused by a botched software update by a cybersecurity firm CrowdStrike Holdings, Inc. has highlighted the need for companies to enhance and strengthen their information technology (IT) contingency plans, analysts said.

“The havoc caused by the Microsoft outage offers a number of lessons regarding the need to regulate the country’s digital transformation,” Leonardo A. Lanzona, Jr., an economics professor at the Ateneo de Manila University, said in an e-mail.

“The incident underscores the need for regulatory oversight to ensure that major technology providers maintain high standards of reliability and security. Regulators may need to establish and enforce guidelines for uptime, redundancy, and disaster recovery plans,” he added.

Operations of airlines, banks, hospitals and other companies around the world were disrupted on July 19 when a software update by CrowdStrike caused problems on devices running Microsoft’s Windows operating systems.

Microsoft in a blog post on Saturday said around 8.5 million Windows devices or less than 1% of all Windows machines were affected by the CrowdStrike update.

The Bangko Sentral ng Pilipinas (BSP) said it was “closely monitoring” the outage’s impact on banks and financial institutions in the country.

“Some BSP-Supervised Financial Institutions (BSFIs) have experienced disruptions but are addressing the issue, while some already restored affected systems,” the central bank said in a statement released late on Friday.

The central bank assured the public that the financial system remains resilient. “The BSP has required affected BSFIs to provide updates and activate their resilience and continuity plans as needed.”

It also noted that its peso real-time gross settlement system was unaffected while other settlements such as PESONet, Instapay, ATM and checks, were completed within the day.

Several domestic banks and airlines reported experiencing disruptions in their operations due to the outage on Friday. Since then, most banks and firms have reported that they have restored their digital channels.

“Critical information systems should always have backups and redundancies. This global outage, which was reported to have happened due to a bad patch, can be managed well by organizations,” Sam Jacoba, founding president of the National Association of Data Protection Officers, said in a Viber message.

Mr. Jacoba said that firms will be able to best cope with disruptions if they can create evolving business continuity plans, conduct regular breach or system downtime drills and prepare a “back-to-manual” plan for worst-case scenarios.

“We still haven’t seen the economic, societal and direct impact to the lives of people directly affected by the outage (i.e. healthcare systems), but the technology companies involved can expect lawsuits to come from various organizations that were impacted by the outage,” he added.

On the regulatory side, Mr. Lanzona said that there must be “clearer and more robust service level agreements (SLAs) that define the rights and remedies for customers in the event of service disruptions.”

“There may also be a need for regulations requiring greater transparency from service providers regarding the causes of outages, response efforts, and measures taken to prevent future incidents. This can help build trust and allow consumers to make more informed decisions,” he said.

Mr. Lanzona also noted that diversifying service providers would also prevent the incidence of a massive shutdown across sectors.

“The source of the problem is the concentration of market power in a few large providers like Microsoft,” he said.

“Encouraging competition and reducing barriers to entry for smaller or alternative providers can help mitigate the risk of widespread disruption due to a single provider’s outage.”

Meanwhile, Terry L. Ridon, a public investment analyst and convenor of think tank InfraWatch PH, said CrowdStrike now needs to address the concerns of clients who were affected by the faulty software update.

“The burden is now on CrowdStrike on how it can assuage its numerous clients for the security and reputational risks which had resulted from their faulty software update,” he said in an e-mail. “It should do this promptly or else its clients will look to other firms which can provide a similar or equivalent service.”

George Kurtz, CrowdStrike founder and chief executive officer, said on Friday that the company has identified the issue and deployed a fix for the failed software update.

“The outage was caused by a defect found in a Falcon content update for Windows hosts. Mac and Linux hosts are not impacted. This was not a cyberattack,” he said on X.

Mr. Kurtz said that the CrowdStrike team will “provide full transparency on how this occurred and steps we’re taking to prevent anything like this from happening again.”

5 energy firms eye Laguna hydropower complex — PSALM

July 22, 2024 | 12:08 am

STATE-RUN Power Sector Assets and Liabilities Management Corp. (PSALM) said the 796.64-megawatt (MW) Caliraya-Botocan-Kalayaan (CBK) hydroelectric power plant (HEPP) complex in Laguna has attracted five potential bidders.

Marubeni Corp., Semirara Mining and Power Corp., Thunder Consortium, First Gen Prime Energy Corp., and Giga Ace 11, Inc. participated in the pre-proposal conference, PSALM said in a statement on Friday.

Thunder Consortium is composed of Aboitiz Renewables, Inc., Electric Power Development Co., and Sumitomo Corp.

PSALM said the conference provided participants with information about the CBK hydroelectric complex, including its technical specifications, operational details, and regulatory framework.

“We are pleased with the turnout and the level of interest shown by industry leaders in the CBK Plant Complex privatization,” PSALM President and Chief Executive Officer Dennis Edward A. Dela Serna said.

“Rest assured that we remain steadfast in our commitment to ensuring a fair and transparent bidding process that aligns with our mandate and at the same time provides maximum value to our stakeholders,” he added.

The CBK hydro facilities are currently under a 25-year build-rehabilitate-operate-transfer and power purchase agreement between independent power producer CBK Power Co. Ltd. and National Power Corp., which will expire in 2026.

These facilities include the 39.37-MW Caliraya HEPP in Lumban, the 22.91-MW Botocan HEPP in Majayjay, and the 366-MW Kalayaan I and 368.36-MW Kalayaan II pump storage power plants in Laguna.

The bidding is set to commence this year, with awarding targeted for 2025.

“PSALM continues to uphold transparency and integrity in its privatization efforts, seeking to partner with a qualified entity capable of leveraging the CBK Plant Complex’s potential to benefit consumers and advance the country’s energy goals,” the company said.

Finance Secretary Ralph G. Recto anticipates that the CBK privatization will generate up to P100 billion. — Sheldeen Joy Talavera

‘Broader access to indigenous gas needed to boost competition’

July 22, 2024 | 12:07 am

By Sheldeen Joy Talavera, Reporter

OTHER energy companies should be given access to explore indigenous gas to enhance competition and efficiency, an analyst said.

“Indigenous gas cannot be limited to only one provider and a few power plants. Ownership should be broadened to allow greater competition and efficiency,” Leonardo A. Lanzona, an economics professor at Ateneo de Manila University, said in a social media message.

“To achieve this, technological innovations and manpower development must be pursued to encourage more players in what currently seems like a natural monopoly,” he added.

Mr. Lanzona also suggested that foreign companies should be allowed to operate under strict regulations to “bring in not only capital but also the necessary technology and know-how to develop the sector.”

Senator Pia S. Cayetano, chairperson of the Senate committee on energy, said at a public hearing last week that the government has identified natural gas as a transition fuel to renewable energy.

“It is important that we have policies supporting more exploration of natural gas because energy security depends on having our own supply,” Ms. Cayetano was quoted as saying in a statement.

“We will be less dependent on international factors that affect the prices of our energy sources,” she added.

Senate Bill No. 2247, or the Philippine Downstream Natural Gas Industry Development Act, aims to promote the development of natural gas.

The Malampaya gas field, the country’s sole natural gas provider, is expected to run dry by 2027. Service Contract No. 38, which governs the Malampaya project, was extended for another 15 years until February 2039.

Energy Undersecretary Sharon S. Garin said that the Department of Energy (DoE) has recommended additional features to the bill, such as prioritizing and utilizing indigenous natural gas.

“It provides us with energy security and reduces our susceptibility to the volatility of the international market,” Ms. Garin said at the hearing.

The DoE also recommended fiscal incentives to encourage investment in indigenous gas and the imposition of fines and penalties that it currently cannot enforce as policy, she said.

Terry L. Ridon, a public investment specialist and convenor of think tank InfraWatch PH, said that the country will “most certainly” need to import natural gas, which is subject to fluctuations in global commodity prices.

He noted that even indigenous natural gas is “dependent on global commodity pricing, though the government has more market control over commodities produced within our borders.”

“It makes sense to continue exploring and fully exploiting the Malampaya gas field, while also importing natural gas for our energy needs. These actions are not mutually exclusive,” Mr. Ridon said.

Meanwhile, Sherwin T. Gatchalian, vice-chair of the Senate committee for energy, lauded the commitment of Prime Energy Development B.V. to further explore the country’s natural gas resources.

“I’m very happy to hear that there is a potential, there is now a potential, real activity in that area and real drilling will happen,” Mr. Gatchalian said at the hearing.

Prime Energy, a subsidiary of Razon-led Prime Infrastructure Capital, Inc., operates the Malampaya Deepwater Gas-to-Power Project. The company is planning to drill at least two deepwater wells in the Camago and Malampaya East fields by 2025.

Noel M. Baga, convenor of think tank Center for Energy Research and Policy, criticized the proposed law for being “lacking” as it does not require third-party access.

Under Section 24 of the bill, participation for any permit holder or operator of a liquefied natural gas (LNG) and regasification terminal and related facilities to third parties is voluntary and at the sole discretion of the permit holder or operator.

“Thus, natural gas developers who do not own LNG terminals or operate pipelines would have no access to natural gas,” Mr. Baga said.

“This restriction hinders competition and discourages new natural gas developers from entering the market since they lack secure access to LNG terminals and pipelines,” he added.

He argued that requiring third-party access would compel LNG terminal owners and petroleum pipeline operators to offer excess capacity to third parties “at fair rates.”

“Such a provision would attract more investors by ensuring a reliable supply of natural gas and fostering competition, which could lead to lower electricity prices,” Mr. Baga said.

In 2023, natural gas accounted for 12% of the country’s power generation mix, with a capacity of 13,858 gigawatt-hours, according to DoE data.

As of April, there are committed natural gas projects, either in the construction phase or with financial closure, with a capacity of 1,320 megawatts.

Gen Z and Millennial stars unite for wide-leg pants

July 22, 2024 | 12:06 am

UNIQLO is trying to make a statement with wide-leg pants, and they did it with a style talk with two stars.

During a July 18 event at the SM Mall of Asia, Uniqlo tapped celebrities Jericho Rosales and Donny Pangilinan to talk about their style preferences, along with stylists Cath Sobrevega and John Lozano (not to mention scores of fans behind a velvet rope, and all the people crowding by the mall’s banisters).

Mr. Pangilinan is riding on a wave of mainstream fame after the end of a series he starred in, Can’t Buy Me Love. He also has quite a pedigree: he’s the son of actress Maricel Laxa and radio and TV host/inspirational speaker Anthony Pangilinan, who happens to be the brother of politician and “Megastar” Sharon Cuneta’s husband, Francis Pangilinan. Meanwhile, Mr. Rosales cemented his place in Filipino pop culture by not only winning the “Mr. Pogi” pageant in the mid-1990s, but starring in several soaps like Pangako Sa ’Yo (2000) and Dahil May Isang Ikaw (2010). A fan’s sign during the event summarized what the two represented: “Millennial Crush = Jericho/ Gen Z Crush: Donny.”

Mr. Rosales, a fixture in showbiz for more than 20 years, wore wide-leg jeans, a denim jacket in a darker indigo, and a scarf matching that jacket’s color. He noted the similarity to styles he had worn before: “Everything’s super-throwback. This is what we used to wear in the 2000s,” he said. “I feel so comfy and so at home in this ensemble.”

He recalls his earlier days in showbiz, when he didn’t think he was very much a style icon: “I came from worst-dressed to best-dressed, because I would wear hand-me-downs. Whatever I received, that’s what I would wear. But then I learned about shapes.”

PROPORTIONS
Stylist Mr. Lozano noted that many men might not feel comfortable in wide-leg pants due to fears of looking short and “lousy.” He said that it was all about proportion. Some styling tricks he gave included the 3/4 rule (making sure the pants serve as 3/4 of your body, giving the legs some length), and cropping pants shorter to give the illusion of height. He also said that one can lengthen one’s silhouette by forming a longer neck (through clever unbuttoning and draping), or forming a straight line by wearing everything in the same color.

Mr. Pangilinan wore wide-leg chinos and a black polo shirt, and white sneakers. Both actors talked about what they valued when it came to style, but Mr. Pangilinan especially gave high praise for wide-leg pants. According to him, his height made him feel that he was more suited to skinny jeans, but, “It feels more loose, more comfortable, and I feel more confident wearing it. It’s easier to move around.”

“I’m very chill, very low-key. I don’t want a lot of loud stuff. [I want] something I can wear every day,” he said. “I always have a bunch of plain shirts in my car.” As he counted off what T-shirts he has in his car, a fan shrieked: “Lahat bagay sa iyo (everything suits you)!”

Mr. Rosales takes a similar approach to style. “I like white T-shirts,” he said, and we noted that he was wearing one under his jacket. “It’s always, white shirt, pants, white or black socks, and then anything that makes me comfortable. If I’m comfortable, then I know I can be stylish.”

Mr. Lozano also talked about how using a belt creates the illusion of longer legs and height when wearing wide-leg pants. Just as well, because Mr. Rosales said, “I always have to have a belt. When I’m acting, I have to have a belt. It’s just my security blanket. I need to have a belt.”

“I just want to be true to myself,” he said. “Style really starts within you. You have to get to know yourself, and what you like.”

THE COLLECTION
Uniqlo’s Wide Pants Collection features items for both men and women. Mr. Pangilinan was wearing the men’s Wide Chino Pants during the talk. The pants feature wider belt loops and coin pockets, and come in a moderately firm material. The Women’s Wide Chino Pants have minimal details and tucks, with a sleek waistline and a straight, balanced wide fit.

Mr. Rosales wore the men’s Wide Straight Jeans which have unique designs departing from traditional jeans. The men’s jeans tone down stitch colors and textures and present a non-bulky wide silhouette. Meanwhile, the women’s wide jeans do not use rivets and coin pockets — symbols of jeans — to create a silhouette with tucks for a sleek and cleaner look.

The collection also includes the Relaxed Ankle Jeans which feature soft twist and double-ply threads that help the knees keep their shape. They are roomy, with a wide fit at the thighs and a sleek ankle length, making it a versatile design that can be worn with a top tucked in or untucked. There are also Pleated Wide Pants, with the women’s version featuring a two-way stretch fabric that stretches at the waist for a comfortable fit. Made with fine fabric with a drape, a high-waist, and wide-leg silhouette. The men’s Pleated Wide Pants has an elastic waist with a wide, straight cut leg with an elegant drape. It is also made with the same two-way stretch fabric that is wrinkle resistant after washing.

All the pants in the collection cost P1,990. They are now available in-store and via the Uniqlo app. — Joseph L. Garcia

Ayala Land raises P20.5B via sustainability-linked financing program

July 22, 2024 | 12:06 am

LISTED Ayala Land, Inc. (ALI) said it has raised P20.5 billion through its sustainability-linked financing (SLF) program.

The SLF package includes a P6-billion SL-bond and a P14.5-billion SL-loan from the International Finance Corp. (IFC), ALI said in an e-mailed statement over the weekend.

The P14.5-billion SL-loan is ALI’s first loan from a multilateral agency and the IFC’s first SL-loan for a Philippine corporation.

The loan will be disbursed in up to four installments.

The funding will be used to implement energy and water-saving measures across ALI’s commercial real estate portfolio, including energy-efficient lighting and cooling systems, passive building design, low-flow water fixtures, and water harvesting and recycling systems.

ALI reported high demand for the P6 billion 10-year term SL-bond, which reached P18.2 billion.

The bond has a coupon rate of 6.9931% per annum and was primarily supported by pension funds and institutional investors. It was listed on the Philippine Dealing & Exchange Corp. on July 18, marking the first ASEAN SL-bond in the local capital market.

ALI said the interest rates of the SL-bond and SL-loan need to meet sustainability metrics such as a 42% reduction in emissions from malls, offices, and hotels by 2030, and achieve EDGE Zero Carbon certification for 1.5 million square meters of office properties by 2025.

Failure to meet the targets will result in a five-basis-point increase in interest rates for each unmet target, up to a total of 10 basis points.

“This landmark investment supports our efforts in portfolio decarbonization and reinforces our commitment to a greener property sector in the Philippines,” said ALI President and Chief Executive Officer Anna Ma. Margarita B. Dy.

ALI said its SL-program is aligned with international standards such as the ASEAN Sustainability-Linked Bond Standards, the Sustainability Linked Bond Principles issued by the International Capital Market Association, and the Sustainability Linked Loan Principles issued by the Asia-Pacific Loan Market Association.

Norway-based international accredited registrar and classification society Det Norske Veritas independently verified ALI’s funding package.

ALI shares were last traded on July 19, finishing at P31.65 per share. — Revin Mikhael D. Ochave

Accountancy, the hidden engine of national progress

July 22, 2024 | 12:05 am

SF_business-man-financial--document-audit-concept_FREEPIK-OL — STOCK PHOTO | Image by Snowing from Freepik

By Bjorn Biel M. Beltran, Special Features and Content Assistant Editor

The success of an economy often relies on the hard work of many unnamed and unrecognized people. At the core of any thriving economy lies the diligent work of government workers, bankers, economists, entrepreneurs, logistics professionals, educators, engineers, and accountants.

Accounting, in particular, is an irreplaceable element in the equation for a modern, thriving society as they play a role in everything from managing personal finances of individual entrepreneurs and business owners to running multinational corporations. Their expertise ensures that financial information is not only accurate but also transparent, and that transparency is necessary in creating an environment ripe for business growth and economic stability.

According to the International Federation of Accountants (IFAC), accountants support businesses in securing investment and accessing credit, which in turn propels economic expansion. An IFAC study, titled Nexus 2: The Accountancy Profession — A Global Value Add, showed that accountancy is strongly linked to prosperity and improved living standards, highlighting the scale of the profession’s importance to the global economy, particularly in developing economies where accountants have a significant role to play in strengthening the institutions and architecture that will improve people’s lives.

“The accountancy profession plays a pivotal role in our financial ecosystem. Without reliable financial reporting, we cannot build the trust that investors and stockholders need to make investment decisions, thus impacting the Philippines’ competitiveness in the global capital market,” Sharon G. Dayoan, chairman and chief executive officer of KPMG in the Philippines (R.G. Manabat & Co.), said in an interview.

Ms. Dayoan explained that as external auditors, accountants provide assurance on the fair presentation of a company’s financial statements, needed to attract foreign investment and foster business confidence. Moreover, accountants also work with various stakeholders for tax compliance, business transformation, sustainability reporting and digital adoption and transformation, which help shape policies that promote economic growth.

Notably, accountants assist businesses in setting up in the Philippines, providing transfer pricing advisory services, as well as expertise in cybersecurity, robotic process automation, and intelligent automation, helping catalyze business growth and help with economic development.

“Accountants significantly impact small and medium-sized enterprises (SMEs) by acting as trusted advisors and providing essential financial management and planning services to drive their businesses forward. We help businesses navigate complex regulatory environments, make informed investment decisions based on financial analysis, and maintain competitiveness in a rapidly evolving market,” she said.

This has only become more essential today as the world pushes for more sustainable development across all nations and industries. The World Bank highlighted the importance of public sector accounting in managing state assets and curbing illicit financial flows, which pose a substantial threat to global economic health. This level of transparency ensures that governments can be held accountable by their citizens, fostering trust and efficient governance.

In 2016, Samia Msadek, former director of Governance Global Practice at the World Bank, said in an interview that in the public sphere, the accounting profession supports a public sector that is more transparent and accountable to its citizens.

“Effective financial reporting is critical to governments’ understanding of their fiscal position and prospects. It is also crucial for providing legislators, markets, and citizens with the information they need to make efficient policy decisions, and to hold governments accountable for their performance,” she said.

“The profession can contribute significantly to the achievement of the Sustainable Development Goals (SDGs) that aim to end poverty, protect the planet and ensure prosperity for all. The ability of countries and corporations to measure progress, monitor impact and report on achievements in these areas will be critical. This is where, in my opinion, accountants have a key, but easily overlooked, role to play.”

Accountants, through their expertise and proficiency in the tools to measure and report on various financial data, can help many organizations progress toward sustainability goals, pushing businesses and governments to track their social, environmental, and economic impacts.

Ms. Dayoan agreed, saying that the transparency that accountants provide public institutions attracts local and foreign investments, and is vital for assessing the effectiveness of government programs.

“Additionally, the expertise of accountants in financial analysis helps shape policies that promote economic growth, sustainability and social equity, contributing to overall economic development in the Philippines,” she said.

Accounting in a changing world

Naturally, as a profession concerned mostly with numbers and metrics, accounting is seeing rapid evolution due to technology. Advances in data analytics, artificial intelligence, and other technologies are revolutionizing accounting practices, making them more efficient and insightful, while also enabling accountants to offer deeper, more insightful strategic advice.

For instance, Ms. Dayoan said that in the Philippines today, accountants are expected not only to report on numbers but also to provide insights, identify trends, flag risks, and contribute strategically.

The expectations of stakeholders, from investors, clients, regulators, to the general public, are also changing. More are demanding greater transparency, enhanced ethical standards, and a more proactive advisory role from accountants.

“The role of accountants has expanded from record-keeping and providing assurance on financial statements to being strategic advisors proficient in areas like data and analytics, sustainability reporting, and risk management,” she said, adding that while technologies like AI and blockchain are enhancing efficiency and accuracy, they also pose risks.

“As an example, AI automates routine tasks and improves data analysis, while blockchain offers secure, transparent record-keeping. This shift allows accountants to focus more on strategic and advisory roles, increasing their value to clients. However, these technologies also pose risks, such as data security concerns and implementation challenges. Accountants must balance leveraging technology with maintaining critical judgment, ensuring they stay relevant and drive innovation in the evolving business landscape.”

Mitigating security risks and taking a proactive stance against any emerging issues will be the key to using these technologies to their fullest. After all, at the heart of accountancy is the unwavering commitment to transparency and integrity.

“The accountancy profession can better serve the needs of the Philippine economy and society by continuing to uphold the highest standards and by embracing the role as catalysts for transparency, sustainability and innovation,” Ms. Dayoan said.

With the integration of Environmental, Social, and Governance (ESG) principles into business practices, she highlighted the crucial role that accountants play in creating a sustainable future by measuring and reporting on ESG performance, providing data to inform sustainable decision-making, ensuring compliance with sustainability standards, managing sustainability-related risks, identifying cost-saving opportunities through sustainable practices, and engaging with stakeholders to communicate an organization’s commitment to sustainability.

“Now, more than ever, continuous learning and the rapid adoption of new technologies are essential. Accountants must proactively upskill and adopt innovative methodologies to effectively meet evolving demands. Additionally, maintaining strong connections and fostering collaboration with fellow professionals, organizations, and stakeholders is vital. By actively sharing knowledge, resources and best practices, we can collectively address challenges and drive positive change.”

Payless marks 14^th year in the Philippines with new look, new stores

July 22, 2024 | 12:05 am

THE DISCOUNT shoe brand’s name says it all: pay less. Payless, a leading affordable shoe retailer from Kansas, USA, founded in 1956, came to the Philippines in 2010.

After 14 years, the brand unveiled a new store concept at the One Ayala Mall on July 18. Boasting a more industrial look, it joins the 48 stores they have in the Philippines, with five more coming this year.

During a tour of the store on July 18, Raissa Barzaga, General Manager of Footwear Specialty Retailers, Inc. (a subsidiary of the SSI Group that operates the Philippine franchise for Payless shoes) told BusinessWorld about what Filipinos buy at Payless. “You see everything. We offer from Men’s, Women’s, and kids; it’s all across categories. It’s also across ages. There’s also for lola (grandma), then we have also for the toddlers. We have the shoes for everybody in this store. That’s really the trend, and that’s really our thrust,” she said.

Among their new lines are Comfort Plus for men and women, which offer memory foam soles for added comfort. Most of their stock is made of fabric or faux leather. Ms. Barzaga gave us tips on how to care for them. “You just wipe them with an ordinary cloth. Or a damp cloth. Aside from the shoe care, you can just do that. Sorry, sometimes, I wash my shoes,” she said.

She also said that Payless’ own shoe care line will arrive in the Philippines soon.

Payless, founded by the Pozez cousins in Kansas in 1956, went public in 1962. It passed through many hands, filing for bankruptcy twice, in 2017 and 2019. The store closures that followed its bankruptcies gave way to a silver lining: it opened an e-commerce venture in 2020. But the silver lining has dulled.

Upon viewing the website as of press time, the website only has a photo of two legs in the air wearing flats, saying, “We’ve got something in the works.”

“We appreciate your patience with us as we’re busy behind-the-scenes working on a shopping experience that will knock your socks off,” said the website, while providing links to their stocks on Amazon. “Effective Aug. 11, 2023, retail sales in North America on Payless.com are no longer available. Please note that all orders made on or after June 6, 2023, are final and non-returnable. We thank you for your patience as we continue to work diligently on the future of Payless.com.”

However, Payless.ph in the Philippines is up and jumping. While their American parent only embraced going online in 2020, the Philippine counterpart been at it since 2018. “We were trying to make sure that the current customers, the Millennials and the Gen Z — it’s different when you shop right?,” said Ms. Barzaga of how online appeals to younger shoppers.

She recalled how the pandemic jumpstarted online sales. It has stabilized now, with Ms. Barzaga telling us that today, while there is a 2% to 3% difference in their online sales versus their in-store sales, the difference was up to 5% during the pandemic. Aside from payless.ph, their shoes are also carried on online platforms Shopee, Lazada, and Zalora.

The pandemic also influenced the styles they carry: “More than anything else after the pandemic, the shoes are really for comfort,” she said.

It’s not hard to find cheap shoes in the Philippines, if you know where to find them. Ms. Barzaga, however, comparing their shoe prices to those in other marts, noted, “Some of our shoes are actually even cheaper. They have (shoes at) P1,650. I have [shoes at] P795!” She said that the most expensive shoes they carry cost P2,200. “We have markdowns every month, because we have arrivals every week.”

More than the price, she says that people come for the store experience: because all of the shoes are on display, “You’re not going to wait for your shoe size.” This is an important point to make as at some of the larger shoe stores it may take up to 15 minutes before the requested style and size can be retrieved from the storeroom for the customer to try on.

Payless Philippines has also made a mark in other countries where their parent company is present. “We were able to dominate the design in terms of influencing the whole Payless business in the US and Latin America. They actually copy the designs (sold here),” she said.

The rest of the Payless stores in the Philippines will be renovated according to the One Ayala store’s current look, and there are plans to build more stores in SM malls in Seaside Cebu, Baguio, Dasmariñas, Cavite, Iloilo; and in Ayala Center Cebu. — JLG

Changan Auto PHL opens mega facility in Pasig City

July 22, 2024 | 12:05 am

VELO_PAGE1_image1 — PHOTO BY KAP MACEDA AGUILA

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The flagship dealership is part of Inchcape’s distribution complex in the country

CHANGAN AUTO, represented by global auto distributor and retailer giant Inchcape in the Philippines, recently opened the fourth dealership — the biggest by far — in its growing network of facilities. Located on C5 in Pasig, the showroom and service area measure a combined 4,373 sq.m.

Directly operated by Inchcape Philippines, the flagship 3S establishment is itself tucked into the larger 11,222-sq.m., so-called Inchcape Philippine Distribution Complex. Once completed, this facility will include a 1,338-sq.m. parts distribution center, which can accommodate “six months’ worth of inventory for all parts including common damaged parts for collisions and maintenance items for all models.” There will also be a body and paint workshop (3,168 sq.m.), and training academy with dormitory facilities.

“This milestone highlights our shared commitment to excellence and signifies more exciting things to come for Changan Auto,” said Inchcape Managing Director for South Asia and Pacific Alex Hammett in a speech after the ribbon-cutting ceremony to formally inaugurate Changan Auto Pasig.

Added Inchcape Philippines Chief Operating Officer Francis Jonathan Ang, in his own speech, “At Inchcape, we believe that our commitment to excellence is beyond delivering quality vehicles. It involves assuring a seamless car shopping experience and exceptional after-sales service to our valued customers… We are able to realize these with state-of-the-art facilities, digitized systems, and, most importantly, through our dedicated team.”

Mr. Ang said that Changan Auto Pasig can service up to 10 vehicles a day — a number they will expand to 60 in the future. The rest of the sprawling Inchcape Philippines location is expected to be fully operational by September this year, added the executive.

“Apart from upgrading our facilities, we are also maximizing our unique digital platforms to support our distribution channels. The Philippines serves as one of Inchcape’s key digital delivery centers, boasting a workforce of over 700 professionals specializing in data science, analytics, and sales force management,” continued Mr. Ang. “Through Inchcape’s expertise and Changan Auto’s global network — which has 35 vehicle and engine plants all over the world as well as research and development centers — Changan owners can confidently expect unmatched quality and service excellence.”

Inchcape is said to be “the leading global automotive distributor with operations in more than 40 markets around the world.” This allows the Changan Auto brand to be “well-positioned for substantial growth.”

Meanwhile, Changan Auto Philippines General Manager Maricar Parco maintained that the flagship showroom and service center “underscore (a) dedication to providing great customer experiences and reinforce (the) commitment to the Philippine market.”

In a release, Inchcape Philippines said that “Changan Auto is recognized by the China Passenger Car Association (CPCA) as one of the top five best-selling brands in China… (and) has consistently demonstrated growth and strength in the global market. As one of China’s largest car manufacturers and one of the top 15 automakers worldwide, Changan Auto’s commitment to customer satisfaction is evident in its expanding market presence, and its dedication to innovation and quality has earned the brand numerous accolades including being named the number one Chinese brand by JD Power and ranking among the top global car makers in recent years.”

For more information, visit www.changan.ph and follow Changan Auto Philippines on Facebook (ChanganAutoPH).

7-Eleven eyes to increase presence in VisMin

July 22, 2024 | 12:05 am

7-ELEVEN operator Philippine Seven Corp. (PSC) is eyeing further expansion in Visayas and Mindanao (VisMin), with plans to allocate up to P4.5 billion in capital expenditure (capex) to open 450 new stores this year.

PSC President and Chief Executive Officer Jose Victor P. Paterno said last week that the company aims to meet the growing demand in these regions.

“It has been our intention to target greater expansion in Visayas and Mindanao because there is high demand and there is still competition. People suddenly have more to spend, but there are not enough convenience stores to meet that demand. We’re scrambling to provide that,” Mr. Paterno said during a virtual briefing.

“We are bullish on the growth in the regions. We’re expanding faster than we ever have and plan to continue expanding,” he added.

PSC Finance and Accounting Head Lawrence M. De Leon said that the company has allocated up to P4.5 billion in capex for opening 450 new stores this year and for renovating existing branches.

This amount is higher than the P3.5- to P4-billion capex budget allotted by the company last year.

“The total capex to support the 450 new stores this year will be around P4 billion to P4.5 billion and will mainly go to opening new stores, 60% of which will be franchise-operated and 40% corporate-owned,” he said.

“We are also allocating part of the P4.5-billion budget to remodel older stores as we renew contracts for existing stores,” he added.

As of the end of June, PSC had opened 170 new stores in addition to the 3,768 stores it had at the start of the year, with around 3,000 located in Luzon. The company expects to have 4,000 stores across its network by the fourth quarter.

Meanwhile, Mr. Paterno said that PSC is adapting to changing consumer shopping patterns. “People are shopping closer to home and shopping from home. A lot of what we sell is for on-the-go needs. We need to respond to that,” he said.

Mr. Paterno also expressed confidence in the company’s economic prospects. “We are confident in the general economic conditions in the Philippines. We believe the government is taking the right steps and has put in place the right people,” he said.

PSC saw a 21.2% increase in its first-quarter net income to P639.3 million.

First-quarter system-wide sales, including the sales and service income of corporate and franchise-operated stores, rose by 19.7% to P22 billion, while same-store sales improved by 8.8%. PSC shares were last traded on July 19, ending at P109.50 apiece. — Revin Mikhael D. Ochave

Style (07/22/24)

July 22, 2024 | 12:04 am

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Puma’s Palermo with Rosé

PUMA and K-pop star Rosé from South Korean musical quartet BLACKPINK are unveiling their first official campaign. For the campaign, the star wears the Palermo shoe in Cobalt and Black, showcasing the shoe’s bright, playful colors and classic terrace gum sole. Puma’s partnership with Rosé will center around the brand’s catalog of silhouettes such as the “Rewrite the Classics” program, which celebrates Puma’s most timeless footwear shapes and brings them into a new generation. The Puma Palermo is available now from Puma.com, Puma flagship stores, and selected Puma stockists, with more colorways coming soon.

Lavojoy products with essential oils

LAVOJOY has a line of bath products — shampoo and conditioner, among others — which use some essential oil to make them special. Lavojoy products were formulated in Australia together with Ron Guba, an expert in the therapeutic use of essential oils. Lavojoy also collaborated with French master perfumer Anne Flipo to develop the scents and aromas of its products. Products by Lavojoy include shampoos, conditioners, body washes, and body serums. Lavojoy is exclusively available at Watsons, SM Beauty, Lazada, Shopee and TikTok Shop.

Fendi makes lollipop holders for Chupa Chups

BLENDING craftsmanship and irony, Fendi unveils its latest accessory created in collaboration with Chupa Chups: the Fendi x Chupa Chups lollipop holder. This unique piece made its viral debut on the Fendi Women’s Autumn/Winter 2024-2025 runway. This was conceived by Silvia Venturini Fendi, Artistic Director of Accessories and Menswear. Available in the form of a charm attached to the Peekaboo ISeeU Soft, Simply Fendi, and By The Way Selleria bags as seen on the runway, or as a necklace, the lollipop holder can be adjusted through the leather strap to ensure it is never out of reach. This “sweet” accessory is made in soft leather that bears the Selleria macro-stitching — a symbol of the brand’s 100-year long history and a tribute to Roman master saddlers — and is adorned with the signature FF logo in metal. A magnetic closure enables a smart opening and closing, while hiding the lollipop inside. Available in an extensive palette ranging from soft hues to vibrant pop tones, the lollipop holder adds a cheerful twist to any look. Warm beige and dove grey complement aquamarine and deep red shades, while dark teal and plum hues follow the palette of the collection. Adding exclusivity to this collector’s item whilst paying homage to the Maison’s legacy, this accessory comes with five co-branded and limited-edition lollipops — a symbolic reference to the five Fendi sisters. Wrapped in a distinctive FF logo cover, the special lollipops combine the iconic FENDI pattern with the Chupa Chups lollipop logo. The lollipop holder is now available in Fendi boutiques worldwide and on fendi.com.

Q&A: ‘We’re very, very confident about the brand’

July 22, 2024 | 12:04 am

VELO_PAGE1_image5 — Alex Hammett delivers a speech at the formal opening of Changan Auto Pasig. — PHOTO BY KAP MACEDA AGUILA

Inchcape Managing Director for South Asia and Pacific Alex Hammett has lofty ambitions for Changan Auto

Interview by Kap Maceda Aguila

SHORTLY AFTER Inchcape Philippines’ inauguration of the flagship showroom of Changan Auto in the country, we spoke with the global auto distributor’s Managing Director for South Asia and Pacific Alex Hammett.

He said that Inchcape’s overarching responsibility is to “create great experiences for both customers and partners by leveraging in-market expertise, unique technology, and advanced data analytics,” which is reflected in how the company is moving on the ground in the country.

Mr. Hammett described the first half 2024 as “very fruitful,” on the back of a dealer forum and the launch of the Changan CS15 crossover at the Manila International Auto Show (MIAS) — underscoring a vision of providing more Filipinos “smart mobility options.” He expressed bullishness for the brand amid a very pronounced influx of Chinese auto brands.

Here are excerpts from our exclusive interview with Mr. Hammett.

VELOCITY: This is a very huge facility for Changan Auto. Why decide to establish such a large dealership?

ALEX HAMMETT: “(Inchcape) represents Changan now in five countries. We’re incredibly confident about the brand. But this property is quite scale — not only the showroom, but the entire complex because it’s going to be a real integral part of our operations in the Philippines. And so while it does have a 10-car showroom for our full lineup of Changan vehicles, and we have a full service center, this property also houses our body and paint operations, our new parts distribution center that will be multi-branded for all of our dealers across the country, as well as the very scale training academy to make sure that our sales associates and our technicians are world-class.

What’s the growth plan like for Changan Auto in terms of dealerships?

We have some plans for locations down south like Cagayan de Oro, Dumaguete, and Davao later this year. We also have plans to get our network up to 29 dealerships by yearend.

The local auto industry in the Philippines has seen quite an influx of brands, mainly coming from China. How does Changan Auto intend to compete in this kind of environment? What do you think are the key things that will drive sales for the brand?

It’s a really good question. Because the Philippines is a left-hand-drive market, a lot of Chinese products can come into the market quite simply. And I believe there are about 32 brands now in the Philippines, and they’re all competing for a small space, making it extremely competitive. But as I said, we have a global partnership with Changan, and we operate in a lot of markets in Latin America. And what we can say is, we’ve seen this in other markets, and we’re confident we can do that here in the Philippines.

Changan has a full lineup from the CS15 all the way up to the Uni-K; the product range is fantastic. Also, the quality of the products is world-class and they constantly win JD Power China’s IQS (Initial Quality Study) and they have since 2018. So, it’s great value for money. It’s great quality product, and with the power of Inchcape, we’re very, very confident about the brand.

Farmers call for tight biosecurity as trials for ASF vaccine continue

July 22, 2024 | 12:04 am

Pigs — STOCK PHOTO | Image by Barbara Barbosa from Pexels

HOG FARMERS are urging the government to implement tighter biosecurity measures to help curb the spread of the African Swine Fever (ASF) in the Philippines as they wait for the government’s approval for the commercial use of a vaccine.

“For now, we push for the strictest biosecurity, based on their capacities, of all our hog raisers,” Alfred Ng, vice-chairman of the National Federation of Hog Farmers, Inc. said in a Viber message.

“We support the announcement of the DA (Department of Agriculture) of controlled vaccination trials with strict monitoring as we do not want the indiscriminate use of vaccine as it is still being tested,” Mr. Ng added. “We all want to have an ASF vaccine soon, but it should be one that has passed all guidelines set forth by experts.”

The decision to use these vaccines should also be left to hog raisers based on their own appreciation of their safety and efficacy, he said.

There were 20 municipalities across nine provinces with active cases of ASF as of July 12, according to the Bureau of Animal Industry.

Last week, Agriculture Assistant Secretary and Spokesperson Arnel V. de Mesa said the government has allocated about P350 million for the procurement of ASF vaccines for a trial run.

He added that the vaccine for controlled vaccination is expected by September after getting approval from the Food and Drug Administration.

“If the results are favorable, then commercial vaccination will follow,” Mr. De Mesa said.

Agriculture Secretary Francisco P. Tiu Laurel, Jr. earlier said the ASF vaccine to be tested by the government would be procured from Vietnam.

Leonardo Q. Montemayor, chairman of the Federation of Free Farmers, said the ASF vaccine from Vietnam is only being used by their local farmers.

“To my knowledge, no other country is vaccinating its hogs,” Mr. Montemayor said in a Facebook Messenger chat.

He added that the government should exercise due diligence and caution before approving an ASF vaccine for commercial use.

Meanwhile, the government should also fast-track the construction of First Border Inspection sites that will examine all refrigerated containers that will enter the country, Mr. Ng said.

The DA plans to put up these facilities, which are meant to ensure imported agricultural goods are disease-free and minimize smuggling risks, in Bulacan, Manila, Subic, and General Santos.

Imported agri-fishery products need to undergo examination by food regulators overseeing the animal, plant, meat, and fisheries industries.

Meanwhile, the DA’s Integrated National Swine Production Initiatives for Recovery and Expansion (INSPIRE) program aims to increase the population of hogs in ASF-hit areas.

Under the modified INSPIRE program, the repopulation program will now focus on the construction of multiplier facilities and production farms using artificial insemination.

Hog production declined 4.3% year on year to 419,370 metric tons in the first quarter, data from the Philippine Statistics Authority showed. — A.H. Halili