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Saturday, November 12, 2005
Batuhan: The food experts
By Allan S. B. Batuhan
Foreign Exchange
A friend of mine came back from Australia this week. Among the thousands and thousands of UK professionals who have finally decided to do something with the awful British weather, he voted with his feet and decided to relocate to sunny
Melbourne.
Turns out he now works for National Food Limited, Australia’s largest national producer and distributor of dairy and milk products. And he told me something I didn’t know yet as a result of being away from the Philippines too long—NFL is a subsidiary of our own San Miguel Corp. (SMC).
Good for SMC, and good for the Philippines. Finally, we have Philippine companies that have ventured beyond our shores, and started to conquer the world - or at least what is left of it to conquer anyway.
Of course, SMC is not the only company to do or to have done so. Zuellig, the Philippine-based medical and FMCG logistics and distribution company, is doing very good business in the rest of Asia.
United Laboratories is likewise spreading its wings in the region, and apparently making very good inroads into their chosen markets.
The problem though is that many other Asian companies are already there before them. Korea’s Samsung, Daewoo and LG are well-known names not only in Asia, but everywhere. China has bought the UK’s Rover automotive group and is going to start production very soon.
Indian conglomerates like Tata and Reliance are buying up or establishing companies everywhere. They are into products that have heretofore been the domain of Western companies, e.g. electronics, IT and financial services.
Our own excursions outside of our shores look tame in comparison with those of our neighbors. More to the point, it has come a little bit too late in the globalization game.
San Miguel has been a household word in Asia for as long as I can remember. In the US West Coast, its products have been sold for as long as there have been Filipinos there (and that is a long time ago, indeed). And though many may not know it, it once owned a beer brewery in Spain.
Yes, the Spanish version of San Miguel beer was once Philippine owned. When the Sorianos still controlled the conglomerate, they sold the company to Spanish interests, and its ownership has changed hands a number of times since then.
That was way before globalization became fashionable and multinational companies were still considered the modern-day conquistadors out to plunder the world.
Today, the Spanish version is only just about one of the most popular beers in Europe and would have done wonders for SMC had it chosen to keep what was then a small regional brand.
In any case, none of our excursions abroad seem to me to play up to our strengths as a global competitor, and therefore give us a real and sustainable competitive advantage in our chosen markets.
Think of Korea, and their dominance in consumer electronics. Their excellent system of training engineers and technicians at competitive costs ensures that they have a firm grip on this segment for a long time.
The Taiwanese are also in the same frame of mind, and stick to those markets they know much better than everyone else.
But food and dairy products? Apart from acquiring Australia’s NFL just because it can, the logic of SMC’s expansion into Australia is not very clear to me.
(November 12, 2005 issue)
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