ASIAN SUPPLY CHAIN DIFFICULTIES ADDRESSED

SINGAPORE -- Modern food retailing in Asia is being hampered by an archaic and inefficient supply chain in most markets -- and business investors should seriously consider setting up new distribution systems, warned speakers here at the 41st CIES Executive Congress.

on, multiple small suppliers making hundreds of direct store deliveries daily, inefficient product handling, lack of knowledge, lack of supply continuity and distribution centers with inadequate cooling facilities.

Ron Floto, chief executive, Dairy Farm Group, said, "It is indisputable that the supply chain in most Asian countries is awfully inefficient from the Western perspective."

"However, many of the participants in the supply chain like it that way," he added. "In many cases, this includes most of the manufacturing community."

Floto said it could not be assumed that one retailer could reform the supply chain.

"Real efficiencies in the supply chain will occur only when retailers begin to act with a greater degree of cooperation and, frankly, the mechanisms to do this now are not available."

However, Ahold's Moerk said he had detected an enormous interest to improve the supply chain, to solve problems, to become more punctual and to start joint activities to battle supply chain inefficiencies.

He said Ahold had just opened a state-of-the-art fresh distribution center in Bangkok, which he predicted would contribute tremendously to the company's operations.

Meork added that with the support of both the Thai and Dutch governments, Ahold had embarked on a program to improve the total supply chain, starting in the field with local farmers and finishing on the shelves of the produce departments in Ahold's Tops stores.

The Food Business Forum has also recognized the need to help Asian food executives cope with supply chain management issues, creating a group call the Asian Pacific Supply Chain Management Task Force.

This is comprised of retailers, suppliers, consultants and other executives working in Asia. The group, which is most active in the Philippines and Thailand, is planning a Supply Chain Management/ECR conference in Manila on October 5-6, 1998.