Dear John Miller,

Today, the 15^th President of Republic of the Philippines will be sworn into office. He has pledged to turn around this country from the quagmire of corruption that we find ourselves in.

And we are rooting for him. Most voted for him and some did not. But now is not the time for taking sides because there are larger issues at hand. To put it very simply, the mission is to do what is right.

Bad things only beget bad things.

What does this all have to do with you? Plenty. For one, the company you represent is entrenched in our country. And two, you know that not everything is kosher. Witness to those poor SMEs that have been bullied left and right by your people. For sure you had nothing to do with it but you can definitely do something about it.

Every war has an ending. Even Afghanistan and Iraq will find a solution. It took Vietnam three decades to end a long and bloody struggle but in your case, who wants this to drag for 30 years?

It’s time. For change and to do what is right.

A new start. And no to corruption. Dear President Noynoy Aquino

Dear President Noynoy,

We voted for you on the premise of hope and battling corruption that has wrecked and stalled the growth of this country of ours. We like to think that there is still hope otherwise we would have migrated already. It’s a new administration and a new start so to borrow a line from those days when the Man Above created things, “Let there be no corruption!”

We would like to ask your help in this problem of ours. You see, small business enterprises like ours are our life’s savings or maybe even worse, our soul held hostage since we borrowed the moon and the stars to start up our own distribution business.

Unfortunately we have been bullied and cheated out of our earnings by a greedy multinational. They couldn’t care less for the little guy. The bottom line for them is their profit and earnings then damn everyone else. As if their predatory pricing and bullying tactics aren’t enough, they threaten us with removal if quotas aren’t met.

We know they waited for a Manny Villar victory because someone in his inner circle is related to someone who works at Nestle. A Villar win meant railroading our case, whitewashing it, and spitting us out.

Now it looks like that they finally want to mend fences, however not under government mediation. What are they hiding? They know that the person you’ve appointed is incorruptible and they know that paying off people isn’t going to work.

We ask that you look into unfair business practices because what does the little guy have? This isn’t a matter we can report to Raffy Tulfo. It is damn clear that the BPO industry is here to stay. For the nation’s economy to thrive there must be a healthy climate for business. They will always have their billions but never at the cost of exploiting the little guy.

We ask that you tell the Department of Trade and Industry that they should step in and investigate this. Ours is a perfect case study. If the current rules and regulations continue without amendment then it is open to further abuse of power. And you of all people should know what that means.

We hope that you heed our meek request. We believe in you and we know you can do it.

Thanks!

FD2

Look up in the sky. It's not a bird. It's a shark.

Nestle controls 70% of the market for powdered milk (Bear Brand), chocolate milk (Milo), and coffee (Nescafe), and non-dairy creamer (Coffeemate). Other products have a strong market share with Nestle enjoying a virtual monopoly on these markets.

For the monopoly to achieve, they organized a nationwide chain of distributors with a semi-exclusive right to distribute products in their allotted areas.

Distributors are required to sell the products at a certain price that is dictated by Nestle. They are also prohibited from adjusting the price for retailers to absorb. That means their profit margins shrink and over a period of time, they begin to absorb bigger losses.

It is logical that distributors make their profits in marked up prices to retailers. Now they are left with scraps.

Because of Nestle’s domination of the market, they can unilaterally increase prices. Instead, the multinational predator bullies its distributors and threatens them with sanctions and removal should they not hit quotas.

This is the story of FD2 and others like them.

Who would have thought that the Nestle bird is a predator?

In business and economics, predatory pricing is the practice of selling a product or service at a very low price, intending to drive competitors out of the market, or create barriers for entry by potential new competitors. In the Philippines, or in the crap that Nestle Philippines pulls, it’s the distributors who are the victims of this nefarious practice.

Distributors cannot sustain equal or lower prices without losing money, they go out of business or choose not to enter the business. Nestle is able to meet its quota while leaving its distributors losing money or worse borrowing money just to keep its business afloat. It’s a vicious cycle and they can hardly raise prices above what the market would otherwise bear.

In many countries predatory pricing is considered anti-competitive and is illegal under anti-trust laws. It is usually difficult to prove that prices dropped because of deliberate predatory pricing rather than legitimate price competition. In any case, competitors may be driven out of the market before the case is ever heard.

In the short term predatory pricing through sharp discounting reduces profit margins, as would a price war and will cause profits to fall.

The only winner is that bird on the damned nest.

That is why the Department of Trade and Industry should step in. Down with these multinational buggers!