Alternate sites for BPO companies emerging

Metro Manila has a population of more than 10 million people spread across 17 cities and municipalities, excellent power and telecommunications infrastructure, and abundance of colleges and universities have made Metro Manila the largest business process outsourcing city in the world.

Metro Cebu, on the other hand, is now touted as the world’s largest emerging BPO city, ahead of the likes of Shanghai and Beijing in China, Ho Chi Minh City in Vietnam, Krakow in Poland and Kolkata in India, according to research firm Tholons.

But the country’s BPO universe stretches beyond these two urban centers.

Ten “cities” have actually proven themselves worthy of being placed on the list of areas most suitable for BPO operations in the country.

According to the Next Wave Cities 2009 report of the Business Processing Association of the Philippines, Commission on Information and Communications Technology and the Department of Trade and Industry, the Top 10 includes Metro Laguna, Metro Cavite, Iloilo City, Davao City, Bacolod City, Metro Pampanga, Bulacan East and West, Cagayan de Oro City and Lipa City.

These 10 “cities” have a combined absorptive capacity of 888,000. Current employment, however, is placed at a mere 35,000.

This means that these 10 areas, all already ripe to host BPO locators, can still absorb a workforce of more than 850,000.

Best three

The report shows that for 2008-2009, Metro Laguna is the best place for information technology and BPO operations outside of Metro Manila and Metro Cebu. Ready access to potential BPO workers is the primary reason for this.

The Metro Laguna area—composed of the cities and municipalities of Santa Rosa, Calamba, Los Baños, Cabuyao and San Pablo—has more than 7,000 graduates each year.

It can also attract graduates and workers from Metro Manila, as well as from nearby Southern Luzon provinces.

This area has an absorptive capacity of 206,000, but currently employs only 6,000 BPO workers.

Apart from its huge base of potential employees, other plus factors for Metro Laguna are its excellent power and telecommunications infrastructure, low vulnerability to natural disasters and the presence of several Philippine Economic Zone Authority zones.

Compared with others in the Top 10 Next Wave Cities list, however, it is relatively more expensive to operate in Metro Laguna.

BPO locators can also try setting up shop at No. 2 destination Metro Cavite, another Metro Manila neighbor that plays host to more than 5,000 graduates each year and is the country’s most populous province.

Its absorptive capacity is even bigger than that of Metro Laguna at 212,000, yet its current employment is pegged at only around 2,000.

Apart from having relatively good roads, power and telecommunications infrastructure, Metro Cavite is also close to the Ninoy Aquino International Airport, a big consideration for BPO locators.

It has limited IT-BPO-specific infrastructure, however, and has no multistakeholder point of contact for investors.

But compared with Metro Laguna, rental rates in Metro Cavite are lower.

Rounding up the Top 3 Next Wave Cities is Iloilo.

Touted as the most cost-efficient city in the list, Iloilo offers potential BPO investors the lowest average wage, rental and power rates among the Top 10.

BPO locators can tap the city’s more than 17,000 graduates a year, although they may have difficulty sourcing additional talent, as the talent pool in the city’s immediate vicinity is quite small.

The city’s current BPO workforce of just 4,000 is way below its estimated absorptive capacity of 22,000.

But investors will have to take into consideration the absence of international flights in the city’s airport, power supply problems and slow construction of IT-BPO infrastructure.

The next frontier

While it has the distinction of being the only city outside of Metro Manila with more than a million people, Davao City is one of the most underutilized potential BPO sites in the country, due mainly to blanket travel advisories that are usually issued against Mindanao as a whole.

The city produces more than 11,000 graduates a year, and also offers potential locators reasonably priced IT-BPO facilities and competitively priced labor and power.

It has both an international airport with international flights and good hotels.

Its growth, however, is hampered by the negative perception of Mindanao in general. Contrary to this bad image, Davao City has one of the most effective police forces in the country, and the peace and order situation in the area is stable.

Bacolod City is another choice BPO spot, having been recognized as the city with the best business environment.

The local government unit helps facilitate the Peza accreditation process and also helps prepare its graduates for work in the BPO sector.

It also provides ready assistance to BPO firms that may encounter any problems during the course of their operation.

But as with most areas in the Visayas and Mindanao, power supply is a problem.

Infrastructure haven

In terms of infrastructure, sixth placer Metro Pampanga offers the best. Centered on the Clark Freeport Zone and including Angeles City and Mabalacat, the area provides BPO locators with an international airport and an efficient road network, as well as reliable and redundant power and telecom infrastructure.

Metro Pampanga also offers access to more than 30,000 graduates a year, institutionalized investor services, an active ICT council and BPO-ready sites that are also Peza-accredited.

But these perks come with a price, as Metro Pampanga has the highest rental and wage rates outside Metro Manila. Low power rates help offset these high costs.

Two other generally untapped potential BPO sites are located in Bulacan—the Baliuag-Marilao-Meycauayan areas in the east and the Malolos-Calumpit areas in the west.

Located relatively close to both Metro Manila and Metro Pampanga, these two key areas in Bulacan occupy the seventh and eighth spots in the Next Wave Cities Top 10 for 2008-2009.

Being near two other Next Wave areas gives Bulacan East and West access to thousands of graduates and workers, in addition to its own 5,000 graduates a year.

While having an absorptive capacity of as much as 300,000, the biggest among the Top 10, there are no BPO firms operating in the two areas.

Its rise to the seventh and eighth spots on the Top 10, however, has prompted the creation of an ICT Council, which will have to quickly address the lack of BPO-ready office space in the province.

Growth potential

Another Mindanao city on the list, Cagayan de Oro City, gives BPO firms another option if they want to escape the already-saturated Metro Manila area. Offering among the lowest rental and wage rates among the Top 10 locations, Cagayan de Oro is considered the most cost-competitive.

Despite having no tertiary schools within its immediate periphery, the city produces more than 6,000 graduates a year and also has access to another 6,000 within commuting distance.

If it plans to take advantage of the BPO boom, the city government should address the relatively high crime rate in the area, as well as prepare additional power capacity to prevent a shortage in the future.

Rounding up the Top 10 is Lipa City in Batangas, which has already proven its position as a BPO host with a huge potential for growth.

Lipa currently plays host to TeleTech and Advanced Contact Solutions, which have a combined employee count of around 1,500. Another 800 people work for smaller IT-BPO players in the area.

The city, however, has yet to put up an ICT Council that will make it easier for IT-BPO companies to set up shop in the area.

New list

By November, CICT chair Ray Anthony Roxas-Chua III said a new Top 10 list of Next Wave Cities would be released.

“Although we’ve already assessed around 40 areas, we want to focus on promoting just 10 at a time. We want to get into that mode where potential investors already have mindshare on our BPO cities. We hope this will serve as an incentive for cities to further develop, to enable them to get into the Top 10,” he said.

Distributor of food supplements based in Cebu to introduce more products

CEBU CITY — Food supplement distributor Uniherb Corp. plans to introduce 12 more products over the next three years.

Slimming product Slima and male potency supplement Hardman will be launched later this year. Athan, which is for vertigo, was recently launched. Nine more new brands, including a cure-all supplement, are in the pipeline.

Jonathan Guardo, Uniherb president, said the food supplements market has not been affected much by the economic slowdown because more consumers are becoming health-conscious.

The Cebu-based Uniherb, which is owned by the Guardo family, currently markets Arthro to manage arthritis, Diabet for diabetics, anti-cholesterol Heartvit, Kidney Care and Eye Berry.

"We are very confident because the people now prioritize their health. There’s a slowdown but it’s not as prominent as in other sectors. All players are still launching new products," he said.






Source: http://www.bworldonline.com/BW072709/content.php?id=046

Maitland-Smith imports custom orders

Maitland-Smith imports custom orders
Program includes 500 furniture items, lamps
Thomas Russell -- Furniture Today, July 6, 2009

These versions of a Maitland-Smith tripod-base table illustrate how a single piece can take on different looks through options in the company’s One program. The table in back has a mixed veneer parquetry top and is shown in a Hyde Park mahogany finish. The middle one has a mirror inset top and a Regency mahogany finish, and the one in the foreground has a snakeskin stone top and a truffle black finish.

These versions of a Maitland-Smith tripod-base table illustrate how a single piece can take on different looks through options in the company’s One program. The table in back has a mixed veneer parquetry top and is shown in a Hyde Park mahogany finish. The middle one has a mirror inset top and a Regency mahogany finish, and the one in the foreground has a snakeskin stone top and a truffle black finish.
HIGH POINT — A key advantage many domestic wood producers tout over their foreign counterparts is the ability to produce custom orders.

Now one high-end case goods importer is showing retailers and designers that it too can handle serious custom work - from its factories in Asia.

Maitland-Smith launched the custom program called One in October with 323 pieces and has since expanded the program to 500 pieces, including 400 furniture items and 100 lamps. Through One, Maitland-Smith offers about 100 options, including 34 stain and painted finishes and 16hardware finishes.

But company officials say the real distinction from most other custom programs lies in the program's offerings of exotic materials. As Maitland-Smith customers know, the company for years has used such materials, ranging from black and tiger penshell to snakeskin and mactan stone varieties, which can applied on surfaces like table or desk tops.

Choices also include some 14 varieties of hand-tooled leather and upholstered leather inlays such as brindle and zebra hair hides, which can be applied to pieces such as a bar unit or a drum table. With lamps, the choices include 100 bases, 100 shades and multiple finials.

Customers can even get pieces with nameplates bearing their signature or the name of their company.

The company also can use customers' own materials on products like chairs and even lampshades.

Maitland-Smith produces some chairs and beds in its factory in Indonesia. But for the most part, One is handled out of the company's factory in Cebu, Philippines, which specializes in working with exotic materials.

The company has produced custom orders for years, but wanted a more formal approach to the process, said Amy Finley, vice president of product design and marketing.

"We did a lot of research in and outside the industry," she said. "We wanted to go above and beyond what was out there."

The roots of the initiative date from 2005, when Maitland-Smith expanded its inventory of whitewood, or unfinished, products. That allowed it to produce custom goods faster.

"The rest of it has been refining our processes as a team of designers, product engineers and production staff," Finley said. "One by one we go through the items and say, ‘What can we change?'"

The company describes the options in marketing brochures and on its Web site at www.maitland-smith.com.

Online, consumers can see what an item looks like with a different finish, fabric or stone option. Retailers and designers (but not consumers) also can get price quotes on the Web site to determine the upcharge.

Typically, there is a 12- to 14-week lead time on simple custom orders such as those with wood or painted finishes. However, this increases depending on the complexity of the order. For example the lead time on a wood piece getting a stone top or penshell surface will be about 16 to 18 weeks.

Doug Renfro, owner of Knoxville, Tenn.-based retailers Renfro Interiors, said the concept of customization has been around for years in upholstery but there hasn't been as wide a variety of options in case goods.

"The possibilities are endless," he said. He also said he believes Maitland-Smith has improved its lead times by stocking more items. Pieces ordered at the April High Point Market have already arrived, he said.

Chris Godfrey is co-owner of Denver-based Whitney Evans Ltd, a showroom that primarily does business with interior designers. He said the Maitland-Smith Web site in particular helps designers work with their clients.

"If you want to customize a piece, you can actually do the design instantaneously," he said. "Designers are pretty good at visualizing this type thing and it helps them show their clients what it will look like."

Dan Bradley, president of Furniture Brands International's Designer Brands division, which includes Maitland-Smith, said he is pleased with the effort.

"They are really offering a product that is probably one of the most innovative products that I have seen in the industry in several years," he said. "This is personalization at its finest.... They literally are producing one of a kind, custom furniture."

On that note, Maitland-Smith's Finley said some visitors to the company's High Point showroom didn't recognize pieces that they had seen before, but were customized. She said more SKUs will be added as the company expands the One program.

"We are really setting ourselves apart in the industry by doing this," she said. "It will drive the bar up and raise the standard of what other people do."

Cartridge World offers franchising opportunity

Cartridge World offers franchising opportunity
Written by Louise M. Francisco
Monday, 06 July 2009 22:55

INK refill and toner replacement service provider, Cartridge World sees more room for expansion this year.

The strong optimism of the Australia-based Company is boosted by franchising inquiries from different parts of the country such as Pampanga, Batangas, Iloilo and Davao on top of an ongoing plan to put up more franchised stores, two in Metro Manila and one in Cebu.

“It is really a challenge to educate consumers that there is real product in a tainted mainstream,” started Bruce Newfield, master franchisee of Cartridge World in the Philippines. “Education is important in establishing the clear message that our products are not substandard nor fall into the universal ink category.”

Newfield told the BusinessMirror that Cartridge World inks come from Germany and are formulated to be “like the original.” Cartridges and toners are sourced from Australia, the United States and United Kingdom.



Since the company has own research and development and suppliers services, prices of the alternative products are reduced compared with original printing peripherals.

“We have proven our operations in 52 countries worldwide. Here in the Philippines, although we just started in 2007, clients and businesses are assured ink will equal the performance of an original one. We also offer 100-percent money back guarantee if we void the printer warranty or damaged the printer itself,” said Newfield.

The executive added they conducted a printer refill population study in the Philippines in 2006 and found they have a 3-percent market prospect.

“If that same study is performed now, probably there will be an additional 1 percent or 2 percent,” said Newfield.

“The markets served by our business are mostly small and medium businesses and corporations engaged in consumer products, mobile handsets and logistics,” he pointed out.

Cartridge World offers franchise operations for P975,000. The return on investment, said Newfield, may vary in terms of rent space, wage, sales and marketing, but disclosed that an operator may break even within six months.