Connect. Communicate. Collaborate. MiCa(P) 189/01/2013 | May/June 2013 supply Chain A sia The Magazine for Supply Chain & Logistics Professionals in Asia Asia’s Rising e-Commerce Superpower pg18 North Asia VS Southeast Asia : Supply Chain pg28 Battlegrounds Mr Onno Boots Venturing into Unchartered Territory pg44 Mr Dickson Yeo Cutting Edge Supply Mr Yves Bernard Braibant Chain in Grocery Retail Industry Thriving Thai Enterprise pg40 pg48 Mr Hiroki Katayama Connecting Last Mile Distribution and the Growth of e-Commerce in Asia pg37 ISSN 1793 5377 Mr Peter Scholten Non-stop Flight of Success pg54 www.supplychainasia.org CONTENTS 4 Editorial Supply Chain asia Team 30 5 About Us Connecting a Community Indonesian Logistics : On 6 Letters to Editor the Move News 8 industry 10 Maritime 12 air 69 Tackling Aftermarket 13 Land Challenges In Asia 14 3PL Features innovation 18 asia’s Rising 40 Mr Dickson yeo - 62 advent of the Cloud : 76 Lifestyle e-Commerce Cutting edge Supply Collaborative iT Quick “Keep Fit” Tips Superpower Chain in Grocery Retail 22 Made in asia? industry 78 Technology strategy 24 Surge of the Slow 44 Mr Onno Boots Top 10 apps for Busy Steaming - Venturing into 64 How to Get your Professionals 28 north asia VS unchartered Territory Product on the Shelves Southeast asia : 48 Mr yves Bernard of Large Retailers 80 Soundbite Supply Chain Braibant - Thriving Thai 66 Developing effective Coolest Places to Work Battlegrounds enterprise and Defendable Recall 30 indonesian Logistics : 54 Mr Peter Scholten Management Plan 82 Last Word On the Move - non-stop Flight of Success Event Dialogues 69 Tackling aftermarket Leadership 37 Mr Hiroki Katayama - Challenges in asia Connecting Last Mile 58 The Rise of the Chief Distribution and the Digital Officer Growth of e-Commerce in asia Celebrating 125 years within the Asia Pacific region 2 Supply Chain Asia EDITORIAL SUPPLY CHAIN ASIA TEAM Paul Lim Frank Paul Carol Chong Jane Lim Cover Picture : Mr Onno Boots, Mr Yves Bernard Braibant, Mr Hiroki Katayama, Mr Peter Scholten and Mr Dickson Yeo Paul Lim Founder/President [email protected] Low Yi Hui Jacqueline Goh Chew Wai Yee Elliyani Mohd Ali Selynn Chew Frank Paul Publisher [email protected] One thing that is in shortage for most people learning the current online shopping arena, we Editorial Team is ‘time’. With our fast-paced and hectic can understand how the changing landscape Elliyani Mohd Ali lifestyles, we are constantly hard-pressed to will affect our businesses and how to tap on Editorial Executive [email protected] fit all our tasks in one day. Luxury activities, this opportunity. Sam Chambers such as shopping, often take a backseat Contributing Editor in our schedule until one day, we are left In this issue, we are also proud to have [email protected] with only two bottles of mineral water and Mr Onno Boots from MNX Asia, Mr Yves Chew Wai Yee Senior Correspondent a carton of stale milk in the refrigerator. Bernard Braibant from Big C, Mr Hiroki [email protected] Thankfully, online shopping was introduced Katayama from TA-Q-BIN, Mr Peter Scholten General Enquiry as the solution to our problem, and is rapidly from Saudi Airlines Cargo Company and [email protected] gaining precedence globally. More and Mr Dickson Yeo from NTUC GLS featured Production & Design more of us are beginning to rely on e-tailers on our magazine. We had the pleasure of Selynn Chew for our grocery, fashion, electronic and discussing the latest market trends as well Graphic Designer appliance shopping. Not only is it efficient as the challenges of talent retention and [email protected] and timesaving, it also opens doors for us management with them. Advertising Sales – International to discover new brands and items that were Frank Paul never available to us before. Despite the current rapid expansion of the Commercial Director [email protected] e-commerce industry however, evidence Coral Law To fully appreciate the immense scope of shows no signs of the industry slowing Sales Executive Greater China the global e-commerce industry, this issue down. With the slow but gradual economic [email protected] of Supply Chain Asia magazine touches recovery, we hope that the e-commerce Events/Marketing upon the e-commerce industry, particularly industry continues to progress, and boost Low Yi Hui China’s. Poised to overtake the US as the our professional, as well as personal, lives. Events/Membership Executive world’s largest online consumers, it is only [email protected] Jacqueline Goh a matter of time before China’s massive Looking forward to your feedback, Academy/Publications Executive spending will change the e-commerce’s The Supply Chain Asia Team [email protected] landscape in the future. By analysing and Administration & Finance Jane Lim Administrator [email protected] Carol Chong HR/Career Services Corporate endorsers [email protected] Platinum Gold Silver Supply Chain Asia Magazine (MICA (P)062/02/2012) is published by Supply Chain Asia Community Ltd. All rights reverved. No part of the publication may be reproduced without prior permission from the publisher. For subscription and other enquiries, please visit www.supplychainasia.org. Corporate Partner 4 Supply Chain Asia ABOUT US Board of Advisors executive Committee Members Dr Robert Yap Chairman & CeO, yCH Group (Chairman of the Board) Finance, Audit & Funding Committee Goh Kwong Hau, Analog Devices Chairman: Mr Wayne Hunt James Sung, Mapletree Logistics Trust Mr Paul Bradley Chairman & CeO, Members: Mr Onno Boots Koh Jin Kiat, Harley-Davidson Caprica international (Vice Chairman of the Mr Sundi Aiyer Leow Yeou Yi, Crocs Asia Board) Pelham Higgins, Goodman Group Compensation & Nominations Committee Peter Barbut, Knowledge Academy Mr Wayne Hunt Chairman: Mr Peter L. O’Brien Peter Chiong, Harley-Davidson President, Asia Pacific, Toll Global Logistics Members: Mr Wayne Hunt Philip Tsou, Global Logistics Council of Taiwan Mr Paul Bradley Phil Vaudin, Brooks Automation Mr Paul Gallagher Poh Yuen Kam, Oracle President, north america Supply, Diageo Events Committee Quyen Nguyen, Chairman: Mr Vijay Anand Vietnam Supply Chain Community Mr Onno Boots Members: Mr Tony Lugg Raymond CK Tan, Spansion Regional Managing Director, MnX express Mr Jeff Baum Rosalind Lim, Dyzle Sanjay Goel, GTC Corp Mr Sundi Aiyer Management Consultant, Strategic Relationships Committee Sharuddin Razie, Western Digital Supply Chain Management Chairman: Mr Sundi Aiyer Shawn Tay, Hewlett Packard Members: Mr Tony Lugg Sheikh Abdulhai, COINSECO Logistics Mr Peter O’ Brien Mr Ajay Mittal Travis Wong, Baker Hughes Head, Asia Pacific Supply Chain Practice, Mr Turloch Mooney Xavier Perello Pairada, SSI Schaefer Russell Reynolds associates Yen-Chun Wu, Jim, Sun Yat-Sen University Academy/Training Committee Zuhaimi Mohd Nor, Western Digital Professor Mark Goh Chairman: Dr Mark Goh Mohamed Irshad, WPL Director, industry Research, Members: Mr Paul Gallagher The Logistics Institute Asia Pacific Mr Colin Nelson Supply Chain Shippers Council (Inaugural Members) Mr Ajay Mittal Publications & Technology Committee Jimmy Khoo, BD MD & CeO, arshiya international Chairman: Mr Paul Bradley Ingeborg Veelenturf, BAT Members: Mr Sundi Aiyer Nicholas Lam, Converse Mr Turloch Mooney Mr Vijay Anand Leow Yeou Yi, Crocs Chief editor, TaCT at international air Transport Marc du Mont, Diageo association (iaTa) Community Committee Roland Chong, Estee Lauder Abhishek P. Rao, Independent Koh Jin Kiat, Harley Davidson Mr Colin Nelson Global Head of Supply Chain, GSK Akash Agarwal, Seagull Maritime Peter Chiong, Harley Davidson Ang Tian Teck, Sticky Spy Jaya Moorthi Pillai, HP Mr Vijay Anand Antonio Kent M. Valderrama, Macrolite Corp Roxane Desmicht, Infineon Senior Director, industries Business unit, Balan Sundarakani, Philippe Ruffier, Johnson and Johnson Global Lead - Travel, Transportation & Logistics University of Wollongong in Dubai Jorgen Bager, Lego industries, Oracle Benny Woenardi, Cikarang Dry Port Victor Soh, Merck Caleb Tan, Lenovo Kevin Cheong, Molex Mr Jeff Baum Christine Lee, DHL Barry McGoldrick, Molex SVP, Manhattan associates Darryl Judd, Logistics Executive Kalaiarasan K, Novartis Durairaj Veeraiyah, BASF Paul Broadhead, Rolls-Royce Mr Tony Lugg Frank Paul, Supply Chain Asia Tan Boon Hao, Rolls-Royce Vice Chairman, TaPa asia Ms Joy Rice Supply Chain Support Director, Asia Pacific, CONNECTING A COMMUNITY Diageo Supporting Organisations About us American Society of Transportations and Logistics (ASTL) China Federation of Logistics & Purchasing (CFLP) Supply Chain Asia is a not-for-profit professional body dedicated to bringing Singapore Economic Development Board (EDB) Federation of Malaysian Manufacturers (FMM) supply chain and logistics professionals in Asia together. Our vision is to create Global Logistics Council of Taiwan (GLCT) International Enterprises Singapore (IE Singapore) platforms whereby members of the community can come together to network, Kainan University of Taiwan (KUT) share and learn from one another. Our focus is to enable the development of Korea International Logistics Council (KILC) Logistics Association of Australia (LAA) collaborative relationships and partnerships. Our mission is to make Supply Chain Philippines Institute of Supply Management (PISM) Asia your community of choice. Supply Chain & Logistics Group of the Middle East (SCLG) Thai Logistics and Production Society (TLAPS) Vietnam Supply Chain Community (VSSC) Republic Polytechnic (RP) Vision Singapore Institute of Materials Management (SIMM) Asia Council of Supply Chain (ACSC) Find us at Connect. Communicate. Collaborate. By empowering members with platforms to apply these three crucial Cs, Supply Chain Asia intends to be the Community of Choice for Logistics and Supply Chain Professionals living and working in Asia. www.supplychainasia.org Supply Chain Asia 5 LETTERS TO EDITOR As an avid fan of Johnnie Walker (I down a shot to relax after a particularly stressful day), the interview with Diageo (A Quest for Perfection in Luxury Supply Chain, Pg 46-49) allowed me a glimpse into the operations behind the brand. No gift makes me happier than a bottle of Blue Label Johnnie Walker in perfectly done packaging. A toast to Diageo for their job well done! Greg Smith, Australia Looking at Mr George Yeo now (The Gentleman: From Politics to Supply Chain, Pg 42-45), it is nice to see that his retreat from politics has allowed him to pursue other new exciting ventures in the industry. I agree with his insights into the ASEAN Economic Community set to happen in 2015. There are undoubtedly many more challenges we need to overcome to truly create seamless trade within the regional community. Olivia Loh, Singapore After reading that article on self-leadership (Be Authentic this Year, Pg 58-59), I took a step back and reflected. I agree with Andrew’s words about how leaders need to have the courage and the guts to make a decision and just go for it. Nobody leads by cowering behind, a true leader charges right at the forefront and brings the team with him to new heights. Thomas Moore, USA [Credit – The Gentleman: From Politics [Correction – Top Supply Chain Personalities in Asia, Pg 18- to Supply Chain, Pg 42-45] Photo of Mr 29] Chairman of the Asian Shippers Council, Mr John Lu, is George Yeo credited to Warton Li/SCMP. also the Chairman (not the managing director) of South Grand Textiles Pte Ltd. [Updates – Top Supply Chain Personalities in Asia, Pg 18-29] In March 2013, Toll [Correction – Passion in Automation, Pg 50-53] Schaefer Global Forwarding announced that Mr Hugh Cushing is set currently has 17 offices in 15 different countries encompassing to retire and will leave Toll in November 2013. Mr Paul Coutts the region of Middle East, China, ASEAN and Australia. has currently taken over as CEO of the company. [Correction – Challenging Times Ahead Despite Positive [Updates – Top Supply Chain Personalities in Asia, Pg 18-29] Outlook] For the Senior Executive Roundtable, intended Supply Chain Asia would like to highlight Mr Mathieu Renard speaker Mr Dhaval Buch was replaced by speaker Mr Rakesh Biron, the Regional Vice President for Geodis Wilson as Singh, the Director of the Institute of Management Studies. another top personality to watch in Asia Pacific. He fronts Geodis Wilson’s drive to capture greater market shares in the region and has over 19 years of experience in key roles in Asia Pacific. He was previously the regional director for South Asia. Write to us your thoughts on the magazine and the articles and you may be featured in the next issue! Letters should include your full name, address and email. (Selected letters will be subject to editing for clarity and space reasons.) Send an Email: [email protected] Send a Letter: 1 International Business Park, #03-01C the Synergy, Singapore 609917 6 Supply Chain Asia Supply Chain Asia 7 NEWS i n d u s t r y Forwarders remain hopeful despite setbacks The Stifel Nicolaus Logistics Confidence Index increased for the fifth consecutive month in March according to the latest survey carried out by Transport Intelligence. The index for the current and expected situation combined was up 0.4 points to 52.5 in March compared with 52.1 in February. China Manufacturing PMI shoots to 50.9 in March In terms of the present logistics situation, the index registered a marginal decline of 0.3 index points to 45.4 from 45.7 in February. China’s manufacturing has expanded at a faster pace in March, Since beginning in March 2012, the index has remained below the 50 signaling that the recovery of the world’s second-largest economy threshold, indicating weaker volumes relative to those expected for is sustaining momentum. the time of year; a reflection of the difficult economic conditions being experienced around the world. According to the National Bureau of Statistics and China Federation of Logistics and Purchasing, the Purchasing Managers’ Index (PMI) Despite being slightly less optimistic concerning the current was 50.9 for March, recording an 11-month high and up from 50.1 environment, forwarders’ expectations for the next six months in February. A separate gauge from HSBC Holdings Plc and Markit improved. The index for logistics expectations increased 1.3 points Economics shows an increase to 51.6 in March from 50.4. Readings to 59.7 in March. above 50 indicate expansion. Gauges of output and export orders advanced in the official survey while an index of input prices declined. This is a boost for new Premier Li Keqiang as he seeks to spur expansion without fanning inflation. The improvement in the month of March follows the weakest January - February growth for factory output since 2009. e-Commerce companies streamline supply chain Designer eyeglasses are typically priced at several hundred dollars as the cost is distributed among designers, manufacturers, brands, wholesalers and retailers. Neil Blumenthal, one of the founders of Warby Parker, decided to streamline the process by eliminating the middlemen and directly selling designer eyeglasses to consumers online. By doing so, they are able to charge the customers just US$95 a pair. Warby Parker is one of a wave of e-commerce companies that aim to build premium brands at discount prices by eliminating the middlemen. The result is they are able to sell the products at a cheaper price to the consumers while reaping higher profit margins for the companies. But managing a product’s entire supply chain has its challenges. Companies have to be vigilant with controlling quality at factories abroad, and also avoid design patent conflicts when working with factories that also manufacture major brands. 8 Supply Chain Asia