The shortage of raw materials is affecting almost all seafood processors in Viet Nam, especially those in the North and the Central. Bidifisco is specialized in offshore fish species, such as mackerel, oilfish, mahi mahi, marlin, and swordfish; however, their supply was running low in 2011, equal to only 20-30% of the previous year.
Bidifisco’s strategic item is oceanic tuna, which is now in short supply. The Binh Dinh Department of Agriculture and Rural Development estimated that oceanic tuna catch in 2011 would reach 4,000 MT but 70% of which is shipped fresh by air directly to the buyers. Only more than 1,000 MT does go into local processing factories. Meanwhile, there are many processors in the country and the raw material demand of a company like Bidifisco is approximately 200-250 MT/month.
This situation has heightened competition among the seafood processors and increased the price. Still, processors are unable to get enough raw materials. The lack of labour is another obstacle to seafood enterprises. Although Bidifisco has good policies in place to retain the employees, there is a trend that local workers migrate to large cities or major industrial parks, trying to find more simple jobs with higher pay, regardless of the fact that the new jobs may be just seasonal. According to the company’s human resource division, Bidifisco would need to increase its work force by 20-30% in the closing months of the year.
Packing the products in Bidifisco
Besides these two key issues, Bidifisco also grappled with the price of electricity and many other costs, which has risen by 20-25%. However, the company’s leaders were fast to fine-tune their business strategy. They shifted focus to value-added products, which consume less raw materials but still profitable. Efforts were also made to reduce the cost, keep up the company’s cold store, boost import of raw seafood, and increase the loyalty of the employees through greater job satisfaction.
Director Cao Thi Kim Lan said the company has long sought raw materials from Asian countries. Every month, it imports 600-800 MT of seafood on average for processing. However, with all the import costs involved, the company’s products have become less competitive. Meanwhile, competition is harsh as major producers such as Indonesia and the Philippines are striving to regain their market share in the European market. Market and product diversification is the company’s solution to all these problems.
Despites all the hardships, Bidifisco still maintains a high pay roll for its workers, subsidizing their lunch, their commuting cost, and accommodation. It also manages to create a sense of belonging and solidarity among 500 workers.
One very important ingredient for Bidifisco’s success is the long- term vision of the company’s leadership. While many companies were making lost as a result of the soaring input cost, Bidifisco still incur profit from the large inventory it has held since late 2010. Besides, with its reputation, the company can always obtain credit from the banks, even at lower interest rate than other companies. This is a huge competitive edge, especially when the banks are tightening their lending standards.
In late 2011, the company accelerated its ISO 22000-9001 management program to become more competitive in the international market. It also reintroduced the air-shipment of tuna and offered more product lines such as stripped bonito. However, there are still some unsolved problems. “Our clients are numerous. However, our land space is small. Apart from one factory of our own, we have to rent two more. As a result, it is difficult to increase the production. Besides, installing more machinery and warehouse would be impossible,” said Lan. She hopes that with the local authority’s permission, she will be able to scale up her factory and warehouse to respectively 4,000 MT/year and 1,000 MT/year.
By Le The Dong
Compiled by THANH PHUONG