CALL anywhere, DELIVER anywhere
Kratos Hub Incorporated recently launched its “CALL anywhere, DELIVER anywhere” program that aims to cater to OFW’s and Provincial clients. Customers are now given an option to send gifts or items to their loved ones even if they are not within the same country or locality.
“Convenience is a benefit that we would like to extend to our customers. As such, we are launching our CALL anywhere, DELIVER anywhere program. In line with this, OFW’s outside the country can now send flowers, grocery items, medicines, or any product within our portfolio to their loved ones especially during special occasions. Even individuals or parents residing in the provinces can send grocery items to their children studying in the Metropolitan Manila area.” Said JP Aclan, President/CEO Kratos Hub Incorporated.
“We are launching this service to expand our customer base and deliver exceptional service. The challenge nowadays is availability. As we expand our branches, we can now cater to more areas. We do not just sell to a customer. We sell to a geography.” Added JP Aclan, President/CEO Kratos Hub Incorporated.
The company also mentioned that this idea has been present for quite sometime now but the main issue is sustainability. “Those who started came at the wrong time. Key here will be differentiation. How are we different from the rest. For those who doesn’t like to send just money, they can send goods or even create a potential business for their families.” Said Raffy Del Mar, General Manager, Kratos Hub Incorporated.
Asked if this will work at this point in time, the Kratos Leader mentioned, “We shall soon find out.”
Customers can now place their orders in our call center: 822-3490 or 377-9391
FACEBOOK– INTERNET, DISTRIBUTORS– What’s Next?
By: JP Aclan (President/CEO Kratos Hub Inc.)
Facebook has redefined the World Wide Web. The concept of SOCIAL NETWORKING has changed the world. If we saw this revolution online, what’s the next big thing for the distribution business?
As a distribution and FMCG expert myself, I truly say that constant reinvent myself as the concepts evolve as we speak. My organization sometimes even had to cope up with the changes that I employ in order to be in tune with this dynamic industry.
Looking at the trade landscape, from traditional trader, to glorified wholesalers, to would be distributors, to 2nd generation distributors, to sub-distributors and dealers, how will brands penetrate the market in the next 20years?
Is it the expansion of Modern Retail Outlets, wholesales up ply channels? Or is there another idea that integrates everything with an end in mind of reaching more consumers?
The answer: BRAND PENETRATION CHASSIS.
Reach Development has been an issue for numerous consumer goods companies. As organizations strengthen marketing plans; there is a specific need to develop the right cost effective distribution strategy in order to improve product availability.
Although the main culprit is cost, sales executives are always guided to out sourcing their distribution campaign. Low cost, but unreliable at best. I’m not even talking about sub-distributors. I’m referring to primary distributors of consumer goods.
Even if we develop them into a powerful secondary organization or a world class distribution chassis, the idea is now obsolete. As profit pressure mounts and the fact that sales professionals continuously abuse their distributor partners, the point of the matter is, we need a 3rd Generation program that will incorporate the ideals of REACH AND BRAND DEVELOPMENT.
What companies need to have is a distribution partner that focuses on BRAND development rather than just volume through put. I’m not saying that volume is bad. Volume is very good especially if it is profitable. This concept is easier said than done. However, it is very timely for this to be
Executed considering that share holders of blue chip corporations are always greedy for higher returns. Let’s face it. We cannot change investor mindset. But we can always develop corporate mindset.
VALUE CHAIN 2012 – Strengthening Key Process for Kratos Hub Branches
As the operation progresses, key elements in the back end processes of Kratos Hub Branches are being strengthened.
At the start of the year, “VALUE CHAIN 2012” was launched that aimed to fortify finance control measures and inventory system to enhance working capital usage.
“We value the investment of our franchisees in such a way that we constantly improve our system in line with the demands of the Business Hub.”, said Mr. JP Aclan, President/CEO Kratos Hub Incorporated.
Value Chain 2012 is the consolidation of the entire Finance, Supply Chain, Logistics and Purchasing module for Kratos Hub Incorporated. The company created this in order to improve CSL and ensure that all of the branches are efficient in their operations.
“I don’t only look at sales as our key competence. I am proud of our value chain system because it is in synchrony with the demands of our customer. I don’t make processes that will define our customers. Our customers define our processes.” , added Mr. JP Aclan, President/CEO Kratos Hub Incorporated.
HR Management – FTE Measure
The current organizational expansion being experienced by the company is presenting new challenges.
As such, the HR department has launched a FTE Program that aims to look into the productivity of every employee in each Kratos Branch.
“We owe it to our shareholders and investors to ensure that we operate economically and efficiently.” Said Mr. JP Aclan, President/CEO Kratos Hub Incorporated.
“I have directed my Finance, HR and Sales Administration team to check on the Full Time Equivalent of our employees. I don’t want to see employees not doing anything and yet they are part of our OPEX.” Added Mr. JP Aclan, President/CEO Kratos Hub Incorporated.
THE DISTRIBUTION FALLACY
By: JP Aclan (President/CEO Kratos Hub Incorporated)
Can distribution in its most practical sense deliver more sales, hence more profits? In my experience, it is a resounding NO.
Let’s face it. Numeric distribution won’t matter in terms of volume. The impact it brings on the table is insignificant to the point that it is only being capitalized by the bureaucracy that exists in FMCG corporations.
What matter’s most is weighted distribution. It’s all about the stock weights of the SKU’S that will definitely rake in the profits. Sellers must focus on developing power SKU’S rather than building trade inventories that will only strain the capital of storeowners.
Of course, this is easier said than done considering that marketing executives are clearly focused on expanding their portfolio to bring in more profits for their assigned category. Insights usually lead to expansion lines in order to address certain needs of consumers but the capitalization of the trade environment is not growing proportionally to this expansion. This is why I always question the profit position of accredited company distributors. I agree that the margins may vary from one principal to the other. But nevertheless, in my 12 years of experience in the field of distributor management, distributors are usually abused. Of course, I cannot categorically say that it is true for all, but majority of the time, it usually happens.
The impact of expansion lines with the promise that distributing more SKUS to the trade environment will lead to higher volume is the biggest fallacy of it all. Distributor profitability is severely affected by high inventories and the fact that there will always be product launches that are not well thought off. This usually leads to capital erosion due to the fall out resulting from the failure of the new line that will in turn translate to losses for the distributor. The VDMP concept (Volume, Distribution, Merchandising, Pricing) is a good read and a spectacular insight for the principal companies but is a potentially big loss for the distributors.
In my opinion, what needs to be strengthened is the marketing chassis of the FMCG companies. The way that brands and categories are crafted must be in tune with driving consumption for POWER SKUS rather than expanding lines that are not really helpful especially at the miniscule trade level. What brand owners should develop is a marketing plan that will generate better acceptance for their products instead of relying heavily on loading distributors, stores under the veil of DISTRIBUTION.
This should change. Company executives’ needs to start thinking like a micro-entrepreneur. . .
The Ambiguity of the Retail/Wholesale
By: JP Aclan – President/CEO (Kratos Hub Incorporated)
There is one common misconception about the retail/wholesale business: “IT’S THE SIMPLEST BUSINESS WITH VERY SMALL MARGINS”. If I were a stagnant type of entrepreneur and an ordinary trader at that, I would have totally agreed with this idea. However, my 12 years of extensive experience in dealing with the retail/wholesale market tells me otherwise.
Yes the margins will appear small. But once you look closer and understand it further, you will see that this industry is the most LUCRATIVE, PROFITABLE and SUSTAINABLE business model that any entrepreneur can ever venture into. There is one issue though, you have to accept and learn to live with its AMBIGUITY. I have known several executives in the FMCG (Fast Moving Consumer Goods) industry that constantly veers away from this landscape.
This is due to the stress level and the time that you need to allocate in order for you to effectively run this business. The ambiguity lies in the basic truth: “THE BUSINESS IS NOT AN EXACT MATH.”
The biggest company in the world, WAL-MART, has perfected this model and look at where they are right now. They are so amassed with cash that when they sneeze, CEO’s of Consumer Goods Companies are catching a cold. However, it is important to note that they succeeded in the first world market. They haven’t conquered the third world yet.
This is where the challenge lies. This is what we have perfected and continuously improve in our company. We know how to attack the basic trade unit of the third world countries: “SARI-SARI STORES.” And we still constantly learn on how to do so.
If you combine the “SARI-SARI STORES” in the world, they are 3 times the size of WAL-MART. This is retail heaven. No single company can monopolize this trade environment.
This is the greatest ambiguity in the retail/wholesale industry. Small margins you say? Try effectively turning your capital and doing business with the Tier 2 and 3 stores.
January 24, 2012
KRATOS HUB BRANCHES ENHANCES REACH
The distribution muscle of Kratos Hub branches are slowly being stretched as coverage expands deeper into tier 3 stores.
“We are now at the forefront of expanding our reach and enhancing coverage further to boost our Q1 sales. In line with this expansion, the company has shifted its gear on covering more stores particularly the tier 3 accounts that are still not covered by distributors and are mainly relying on wholesalers in the area. “, said JP Aclan, President/CEO of Kratos Hub Incorporated.
The branches and its franchisees are ecstatic about the current set up due to promising results in the first three weeks of the year.
“Volume has grown by +25% with profits improving at +40% due to the lower discounts extended to these stores.”, said Rose Aclan, Chief Finance Officer of Kratos Hub Incorporated.
“This is the difference with our operation compared to the distributors and ordinary wholesalers. We do it methodically and we are not loyal to any principal company. We are loyal to our customers. We are PRO-STORE.”, added JP Aclan.
KRATOS HUB ORGANIZATION GROWS
The Kratos Hub Organization continuously expands providing more jobs in each locality. The biggest growth came from the selling organization as more sales personnel join the fray to support the Kratos Hub Branch Expansion.
“We owe it to our franchisees and investors to provide them with the best sales personnel that will drive volume growth.”, said JP Aclan, President/CEO Kratos Hub Incorporated.
There has been clamor from numerous sales professional to join the organization due to the better pay offered by the company, culture, family atmosphere, and most importantly, exceptional vision that the senior management team has pushed forth.
“We are not just ordinary workers. We are knowledge-workers. In Kratos Hub, you will continuously learn. The President himself will always ask you, ‘What have you learned?’ or ‘Organize your thoughts.’”, said Raffy Del Mar, General Manager Kratos Hub Incorporated.
“We seek to be the best in what we do. Our organization is like any strong brotherhood. We only accept and retain the best.” Said Orly Lopez, Operations Manager Kratos Hub Incorporated.