SUPPLY CHAIN MANAGEMENT IN PHILIPPINES FOR SME

1.0  Summary: Philippine is one of the largest grower and exporters of mangoes in the Asia. SCM in the mango industry was selected as small and medium scale producers and marketers dominate the market .In Philippine mango agribusiness can be seen as product flow through various subsystem .supply chain of mongo industry consists of four subsystem namely input subsystem, production subsystem, processing subsystem, marketing subsystem to meet the demand of the both domestic and export market. Hong Kong and Japan are the major importer of Philippines’s mangoes. The supply chain concept of managing materials supply is relatively new in the Philippines especially in the agribusiness industry. The Philippines, being an archipelago, faces more difficulties in supply management and logistics support as well as handling and transport.

Figure 1: Agribusiness Framework.

2.0 Keywords: Supply chain, SME, Mango agribusiness

3.0 Problems:

·         Mango is a agro-based product  so delays in supply chain management cause

 great harm to this industry.

·         In Philippines there are some restrictions in importing chemical flower inducer which increase the total product time and therefore the cost as well.

·         Documentation Process of delivery system including export import is a lengthy procedure in Philippines.

·         Backyard growers have limited number of trees and they suffer from limited financial resources.

·         Transportation facilities and infrastructure are not developed as needed in Philippines.

·         Competition is high during the lean months and high prices benefit a smaller number of growers who are able to induce flowering for harvest during the off-season period.

·         Major problems have been observed in plantation scale mango operations in the Philippines. as unproductive trees, lack of labor  and difficulty in pest management.

·         Customers are affected by the high domestic mango prices especially in comparison with cheaper imported fruits.

·         Farmers do not have their own buying house which deprived them from getting actual price.

·         The numerous layers in  the supply chain system cause difficulty and raise the cost of product

·         There are little government involvement is noticed in this sector which is not appraisable.

 

 

4.0 Prospects:

Better or more competition among the island provinces ensure better quality of mangoes and better supply chain for the effort.

1. SME has created new opportunity for agribusiness because small and medium size farms are more manageable especially in farm operations such as fruit wrapping and harvesting.

2. By reducing the price of mongo in domestic market can help grow mango agribusiness that can be possible by improving supply chain effort.

3. The application of technology in supply chain can reduce the cost of materials and ensure timely information for concern parties.

4. The application of SCM systems and technology is important especially for a country composed of numerous islands and transport takes different modes such as land, sea and air.

5. Individual growers are now more aware of the need to improve their cultural practices. Firms involved in marketing are into supply management by establishing their own buying stations.

6. Research should be frequently conducted on supply chain in SME for identifying opportunities and important issue covering agribusiness.

7. Mango production should be decentralized.

8. Increasing the number of effort to raise the number of countries for export because Philippine has good quality of mangoes

 

5.0 Recommendations:

Supply chain management system is much more important in agricultural product as they are perishable in nature so the mango production process in Philippines needs a more efficient supply chain management system.

·         Delays in import approval of chemical flower inducer which increase the cost of production need to be demolished.

·         Tedious documentation of import related papers need to be done within short time.

·         Farms should be small or medium in size because it is easier to manage than that of a large farm.

·          Backyard growers who have limited financial recourse should provided with financial help.

·          Handling, transportation facilities and infrastructure need to be updated for avoiding the compression damage, bruises and cuts.

·         Philippine should focus on Hong Kong market because of easy protocol.

·         The numerous layers in the supply chain system cause difficulty and raise the cost of product so these unnecessary layers should be removed.

·         Harvesting during the off-season period is more profitable therefore farmers should consider it.

·         Cultural practice need to ne improved for better marketing position.

·         Establishing farmers own buying stations and/or buying from other wholesalers may seem to be more profitable.

·         The improvement of the product quality should be starts from the production stage and monitored through the supply chain until it reaches the consumer.

·         The application of the SCM systems has to be further explored and adopted by more SMEs in the Philippines.

·         The transportation system across the county land, sea and air need to be improved for quick and cost effective supply of products.

Conclusion:

SCM has good applications in the agribusiness sector. It deserves further exploration and direct adoption by SMEs. Both the government and private sectors must work together in promoting its implementation and application, and determining its impact on the SMEs.

      



                                               





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