Cebu Pacific (CEB), the Philippines’ largest domestic airline and leading carrier to the ASEAN region takes delivery of a brand new Airbus A320 aircraft from Toulouse, France today. This is the second brand new A320 that arrived this 2009, the first of which was delivered last January 29. The additional two aircraft will be used to service additional frequencies to Shanghai, Kuala Lumpur, Macau, and other domestic routes from CEB’s Manila hub. CEB currently has the youngest fleet in the country, comprised of 11 Airbus A320, 10 Airbus A319, and six ATR 72-500 aircraft.

Entrepreneurial passion
I believe that the first element of successful conglomerates is the ability to sustain the entrepreneurial passion of their founders. A common thread that I have observed is that many Asian conglomerates were started by immigrants who engaged in business as a matter of survival. Entrepreneurial skill was not an option; it was a necessity!

In our case, I was the eldest son of a Chinese businessman who settled in the city of Cebu in the Visayan Islands.

While our family achieved some prosperity before the last world war, that all changed when my father suddenly died of an illness and when the war put everyone on equal footing.

I started working at the age of 13, selling soap, candles and thread in a small stall at the city market. My small trading business grew into a vibrant trade between my home in Cebu and Manila.

Eventually, through hard work, frugality and the help of all my siblings, we expanded this to trading between the Philippines and the United States.
This entrepreneurial drive and desire to survive and thrive got us into manufacturing. It became clear to me that we would not grow very much just importing goods. With this in mind we set up a corn starch manufacturing concern called Universal Corn Products, which eventually evolved into what is now our largest business with a pan-Asian footprint — Universal Robina Corp.

Through Universal Robina we have achieved our present position as the Philippines’ largest and most dominant snacks and beverage player, and one of the fastest growing around the Asean region. Other businesses were spawned by the robust cash profits of our branded food business and over time, we forayed into a very diverse set of businesses.
These businesses became the foundation of JG Summit Holdings Inc., a holding company we formed in 1990 which went public in 1993. Today, we are engaged in eight major businesses: food, real estate, telecommunications, airlines, petrochemicals, banking and financial services, retail and publishing. We are also increasing our presence in other markets in Southeast Asia and Greater China.

While these businesses seem diverse and unrelated, all of them actually have a common thread — they are all large and growing consumer-oriented or consumption-driven industries; and they all require innovative entrepreneurial skill, and disciplined operating management.

Access funds
The second element of success that I have observed from Asian conglomerates is their ability to access funds and channel capital into industries that developed into globally competitive businesses.
I have observed two categories of conglomerates in the region and they follow very distinct geographic and industry lines.

First, in North Asia we have the “keiretsu” of Japan and the “chaebol” of South Korea, and perhaps some Taiwanese industrial groups, that are engaged in capital-intensive and well protected heavy industries like steel, petrochemicals, electronics, automobiles, shipbuilding, engineering and construction.

Second, in Southeast Asia we have the large family-owned and managed conglomerates that got involved in manufacturing, trade, real estate, telecommunications, airlines and other services.

The first group was well capitalized and well protected such that they were able to build their capabilities to penetrate and compete in global markets. In many respects they were aided with tariff protection and direct subsidies until they were able to transition to directly accessing the international capital markets themselves.

The second group did not require (and was not given) as much access to low-cost capital and government protection as the first group, and they developed their competitiveness by achieving scale via their participation in a wide variety of industries (as opposed to just focusing on just a few related ones) that enjoyed a broad consumer demand base. Many of our businesses in JG Summit follow the patterns of this second category of Asian conglomerates.

Consumer spending
We could not just focus on just one industry because the only way for us to get bigger was to get involved in other businesses that were also driven by consumer spending — like real estate and retail. Eventually, by continually plowing back our profits into these new businesses we were able to get into telcos and airlines and petrochemicals, which became accessible to us either because the government deregulated them and handed out franchises, or because government liberalized international capital sources which gave Philippine companies greater access to the international capital markets for lower cost funding.

Family control
The third element of success I have observed is that successful Asian conglomerates have learned to maintain strong family or core shareholder control, even as they broadened their investor base and professionalized their management organization. Before the last world war, the dominant civil leadership came from colonial powers. They basically defined how businesses were organized and developed. After the war, with the departure of the colonial powers from most of Asia, entrepreneurial families started to define how businesses were formed and developed, and this gave birth to the form of conglomerate that we see successful in most of Asia today.
The strong family or core shareholder control enables these large organizations to sustain the original entrepreneurial effectiveness of the founders, while imbibing the experience, science and efficiency of professionally trained managers. In JG Summit, while our oversight boards include independent directors who represent the interest of the broader base of our minority shareholders, there are a larger number of family members from both the older as well as the younger generations.
By the way, professionalism is not exclusive to those who are not family members. Over the years a family-run conglomerate will have to spawn and breed family members who are trained and educated in the disciplines of globally competitive management practices.

This is something they cannot abdicate to non-family professionals.
Conversely, entrepreneurial skill cannot also just remain among family members. It is important to be very intentional about developing a culture of innovation and value-creation throughout the conglomerate so that non-family professionals will also be equally skilled in entrepreneurship. We make this very deliberate in JG Summit.

We have sent both family and non-family members of management to the best business and management schools of the world; and we have also allowed our professional managers enough entrepreneurial space for calculated risk-taking in order for them to develop the same instincts about creating value that has served our group well over the years, and across so many different businesses.

Key ingredients
These I believe are the key ingredients of a successful Asian conglomerate:
1) the founders’ entrepreneurial passion;
2) capital access and economies of scale; and
3) continuing professionalism anchored on a strong entrepreneurial culture.

(The author delivered this speech on Oct. 24, 2008, during the Columbia Business School Pan-Asian Reunion.)

Cebu Pacific president and chief executive Lance Gokongwei said in a statement, “we carried 5.38 million domestic passengers last year, up 20.7 percent from 2007, while international passengers rose by 33 percent, from one million to 1.4 million”

Gokongwei attributed the growth in passenger traffic to the increase in the airline’s seat capacity, coupled with introduction of low fares.
“We were able to successfully convince more Filipinos to travel by air despite economic uncertainties. 2008 challenged us to look for ways to stimulate travel and sustain our domestic and international operations,” he said.

Cebu Pacific introduced all-inclusive fares in the domestic air travel market and launched ‘Go Lite’ fares that gave discounts to travelers without check-in luggage.

In a statement, the airline yesterday said it had flown 6.7 million domestic and international passengers last year, a 23% increase from a year earlier.

“We carried 5.38 million domestic passengers last year, up by 20.7% from 2007, while international passengers rose by 33% from one million to 1.4 million,” Cebu Pacific Chief Executive Officer Lance Y. Gokongwei said.

Cebu Pacific (CEB), the Philippines’ leading domestic airline has opened its new Robinsons’ Galleria Ticketing Office. The new Cebu Pacific Galleria Ticket Office is located at West Lane, Level One (beside Chowking and Metrobank).

Because of its growing passengers, Cebu Pacific has increased its ticketing facility, by more than doubling its counters from eight to 20.

Present during the inauguration are Candice Iyog, VP marketing and distribution; Marvin Cui, director for reservations and ticketing; Michael Shau, VP Airport Services and Logistics; and Charlie Manio, director for advertising and promotions.

FLIGHT ATTENDANT Manila Screening
January 14, 21 & 28, 2009 from 9:00am – 11:00am and from 2:00pm – 4:00pm at the Training & Development Center, Domestic Road, Pasay City. Please come in business attire (preferably sleeveless blouse with blazer and in skirt-below the knee with no stockings), hair neatly tied away from face and in full make-up. Screening is on a first come first serve basis.

FLIGHT ATTENDANT Iloilo Screening
January 15, 2009 from 9:00am to 3:00pm at the Roca Encantada Room of Sarabia Manor Hotel, 101 Gen, Luna St., Iloilo City. Please come in business attire (preferably sleeveless blouse with blazer and in skirt-below the knee with no stockings), hair neatly tied away from face and in full make-up. Screening is on a first come first serve basis.

FLIGHT ATTENDANT Dumaguete Screening
January 22, 2009 from 9:30am to 4:00pm at the Student Affairs Conference Room of Foundation Unversity. Please come in business attire (preferably sleeveless blouse with blazer and in skirt-below the knee with no stockings), hair neatly tied away from face and in full make-up. Screening is on a first come first serve basis.

FLIGHT ATTENDANT Legaspi Screening
January 28, 2009 from 9:00am to 3:00pm at the College of Nursing-Amphitheate

r of Bicol University. Please come in business attire (preferably sleeveless blouse with blazer and in skirt-below the knee with no stockings), hair neatly tied away from face and in full make-up. Screening is on a first come first serve basis.

Qualifications:

Female; 18-25 y/o; 5’3 in height
Good set of teeth and skin; weight proportional to height
College level / graduate
Good communication skills
Willing to be based in Cebu, Manila, Davao and Clark

You may contact the following numbers below and look for Rey;

+63919-2701521
+63922-8803257
+6328519423

With this latest news expect no fair increase when you travel with Cebu Pacific (CEB).

According to Cebu Pacific (CEB), the airline will try to accommodate passengers affected by flights scheduled to use the grounded ATR aircraft.

In the meantime, some flights to and from Caticlan will continue to operate from Kalibo airport.

Starting January 7, 2009, Cebu Pacific will remove fuel and insurance surcharges for all domestic flight bookings.

Spokesman of Cebu Pacific, Candice Iyog said, that they are committed to offer the public the most affordable fares coupled with the newest planes. They have made air travel a viable option for those who normally travel by bus or ferry. They expect to take delivery of six brand-new aircraft in 2009.

Passengers can now easily compare airfare with that of buses and ferries.

Cebu Pacific also lowered their fuel and insurance surcharges for select international routes. Manila-Bangkok and Clark-Bangkok one-way surcharges are now slashed from $80 to $50 and $80 to $60 respectively. Manila-Osaka one-way surcharges are cut from $110 to $100. Manila-Hong Kong surcharges are cut from $45 to $40 per way.