THE Department of Trade Industry (DTI), through its Competitiveness Bureau-Supply Chain and Logistics Management Division, is eyeing the creation of Regional Logistics Roadmap seen to benefit local enterprises, including those in Western Visayas.
DTI Supervising Trade and Industry development specialist Jonathan Cabaltera, who spoke at the dialogue on Philippine Logistics at L’Fisher Hotel in Bacolod City Wednesday, October 4, said they are planning to create a logistics roadmap for each sector.
Cabaltera pointed out that it would require “heavy work” as it will include logistics of supply chain requirement of a specific sector like bamboo, furniture, or handicraft, among others.
“We are looking at having it by region instead. Then, we will just identify potential and booming industries that need to have a logistics development plan,” he said, adding that “regional development is one of the goals thus, let us do the regionalization of the plan.”
The DTI attached agency has identified weak linkages between agriculture, manufacturing and service as one of the major gaps in terms of supply chain.
Cabaltera said this issue is being addressed by the Export Development Council by building a clustering system that will put together in one link the supplier, raw materials and services, or those that will buy the products.
“The weaker the linkages, the bigger the logistics costs of the businesses,” Cabaltera said, adding that if buyers from Visayas source out raw materials from Luzon “it would surely mean huge cost.”
Dubbed “Road to Seamless Philippine Logistics: Analysis of Logistics Performance,” the activity was attended by about 100 small and medium enterprises (SMEs) in the province.
During the dialogue, the agency presented the result of its logistics efficiency indicator (LEI) survey conducted this year. The objective of the survey is to have a baseline data on logistics cost, reliability, and income.
The result showed that the country’s average logistics cost is 27 percent higher compared to other Asean countries.
Cabaltera attributed the higher logistics cost to the country’s geographical setting. Meaning, the products have to be shipped from island to another.
High value goods like computers and electronics have lower logistics cost.
He also pointed out that higher logistics cost impacts negatively businesses. Meaning, 27 percent of the sales of local enterprises goes to it.
“It will hurt businesses,” Cabaltera said, adding that they still have to validate the result of the LEI survey since the area covered by the survey in the Visayas only included Cebu and Iloilo.
Survey results further showed that in terms of logistics performance by regions, Visayas has the highest transportation load time and damage rate.
The region ranked last in terms of delivery in full on time aspect. Luzon ranks first when it comes to average order cycle and transportation load time areas, it added.
The dialogue also included sessions on programs and initiatives of the Competitiveness Bureau, Export Development Council advocacies, and best practices on logistics management business, among others.
The DTI officials along with some sector representatives in the province will again meet for a focus group discussion Thursday.