Oct 15, 2020

Inside Trinidad and Tobago’s Manufacturing Landscape

InvesTT
Manufacturing
Trinidad and Tobago
Digital Transformation
Sean Galea-Pace
4 min
Inside Trinidad and Tobago’s Manufacturing Landscape
Supply Chain Digital examines Trinidad and Tobago’s manufacturing industry and the benefits that operating in the country brings...

When setting up a new manufacturing operation or preparing for an expansion project, location is key. Trinidad and Tobago, located 10 kilometers off the coast of Venezuela, is the southernmost island in the Caribbean Archipelago and lies at the crossroads to South, Central, and North America. This small twin-island republic offers many location advantages to global manufacturers in need of the right business location. 

With a dominant oil and gas industry, Trinidad and Tobago offers the second cheapest electricity rate in the western hemisphere starting at US$0.03 per KWH which is supported by a robust national grid. This enables the development of opportunities in a number of manufacturing sub-sectors, primarily Food, Beverage and Tobacco Product Manufacturing; Pulp Manufacturing; Printing and related support activities; Inorganic Chemicals; Organic Chemicals; Resins; and Agricultural Chemicals.

Regional and international market access is available to over 965 million people via the country’s established trading agreements with territories that include CARICOM, European Community, Costa Rica, Dominican Republic, USA, Colombia, and Venezuela. Electricity-intensive manufacturers operating in the country have the added benefit of ready access to large markets in close proximity through the existing robust infrastructure of supporting logistics.

As the country’s third-largest contributor to its overall GDP after energy and services, the manufacturing industry employs approximately 8.2% of the labour force at over 270 registered manufacturers. This includes industries across seven distinct sub-industries. The largest sub-industry - Food, Beverages and Tobacco includes the production of alcoholic beverages, carbonated beverages, juices, cereals, chocolate, confectionery, canned foods, baked goods, and tobacco products. These industries are supported by a highly-skilled labour pool trained at secondary, tertiary, and technical levels of the education system.

Many fiscal incentives are awarded to large scale manufacturers under the provisions of the Fiscal Incentives Act Chapter 85:01. Projects qualifying for the fiscal incentives usually fall within one of the five classifications outlined in the Act. Under the provisions of the Fiscal Incentives Act, an organisation can benefit from exemptions from, customs duties on the construction of an approved project, Value Added Tax, and Income Tax on dividends or other distributions, other than interest, out of profits or gains derived from the manufacture of the approved product during the tax holiday period.

Under the Third Schedule of the Customs Act, Chapter 78:01, import duty concessions are awarded to qualifying manufacturers that produce products locally in Trinidad and Tobago. Import Duty Concessions enable qualifying manufacturers to receive concessions on import duties for items they import as suppliers, in order to meet their manufacturing needs. Import duty concessions are offered in the following areas for the manufacture and processing of specified products: raw materials, machinery, equipment, and in some cases packaging material.

The Phoenix Park Industrial Estate, the country’s latest industrial park project, is strategically located in the southern region of Trinidad and is actively seeking both domestic and international investors interested in establishing operations on the island. In addition to Manufacturing operations, the Park is also geared towards the tenanting of businesses operating in the Assembly, Logistics & Distribution, and ICT industries. Outfitted with modern facilities and infrastructure, the Phoenix Park offers tenants a generous amount of space for uninterrupted business operations, supported by easy access to shipping port facilities. Available spaces, all offered at competitive rates, include 76 leasable lots for light industrial activity, 2 leasable lots for commercial activity, 5 factory shells, and lot sizes ranging from 0.5 to 2.1 and 10 acres. 

The country’s national Investment Promotion Agency(IPA), InvesTT is internationally recognized for excellence in the provision of services to guide investors considering to establish a presence or expand their footprint in Trinidad and Tobago. The agency has received many accolades including its latest award, Best to Invest Top Agency Award, recognizing the IPA as one of the top four IPAs in the region of Central America, the Caribbean & South America, received in 2020 from Site Selection Magazine. 

InvesTT offers its full slate of services to investors considering Trinidad and Tobago as their investment destination for their manufacturing and other non-energy projects such as IT, agriculture and agro-processing, maritime services, creative industries, financial services, and tourism. The experienced team of industry experts at InvesTT works in partnership with investors from the beginning of their site selection process, all the way through to the launch of the business, and also provides aftercare services to ensure successful operations.

Interested in learning more? Click here! 

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Jun 11, 2021

NTT DATA Services, Remodelling Supply Chains for Resilience

NTTDATA
supplychain
Supplychainriskmanagement
Procurement
6 min
Joey Dean, Managing Director of healthcare consulting at NTT DATA Services, shares remodelling strategies for more resilient supply chains

Joey Dean, the man with the coolest name ever and Managing Director in the healthcare consulting practice for NTT DATA and is focused on delivering workplace transformation and enabling the future workforce for healthcare providers. Dean also leads client innovation programs to enhance service delivery and business outcomes for clients.

The pandemic has shifted priorities and created opportunities to do things differently, and companies are now looking to build more resilient supply chains, none needed more urgently than those within the healthcare system. Dean shares with us how he feels they can get there.

A Multi-Vendor Sourcing Approach

“Healthcare systems cannot afford delays in the supply chain when there are lives at stake. Healthcare procurement teams are looking at multi-vendor sourcing strategies, stockpiling more inventory, and ways to use data and AI to have a predictive view into the future and drive greater efficiency.

“The priority should be to shore up procurement channels and re-evaluate inventory management norms, i.e. stockpiling for assurance. Health systems should take the opportunity to renegotiate with their current vendors and broaden the supplier channel. Through those efforts, work with suppliers that have greater geographic diversity and transparency around manufacturing data, process, and continuity plans,” says Dean.

But here ensues the never-ending battle of domestic vs global supply chains. As I see it, domestic sourcing limits the high-risk exposure related to offshore sourcing— Canada’s issue with importing the vaccine is a good example of that. So, of course, I had to ask, for lifesaving products, is building domestic capabilities an option that is being considered?

“Domestic supply chains are sparse or have a high dependence on overseas centres for parts and raw materials. There are measures being discussed from a legislative perspective to drive more domestic sourcing, and there will need to be a concerted effort by Western countries through a mix of investments and financial incentives,” Dean explains.

Wielding Big Tech for Better Outcomes

So, that’s a long way off. In the meantime, leveraging technology is another way to mitigate the risks that lie within global supply chains while decreasing costs and improving quality. Dean expands on the potential of blockchain and AI in the industry

“Blockchain is particularly interesting in creating more transparency and visibility across all supply chain activities. Organisations can create a decentralised record of all transactions to track assets from production to delivery or use by end-user. This increased supply chain transparency provides more visibility to both buyers and suppliers to resolve disputes and build more trusting relationships. Another benefit is that the validation of data is more efficient to prioritise time on the delivery of goods and services to reduce cost and improve quality. 

“Artificial Intelligence and Machine Learning (AI/ML) is another area where there’s incredible value in processing massive amounts of data to aggregate and normalise the data to produce proactive recommendations on actions to improve the speed and cost-efficiency of the supply chain.”

Evolving Procurement Models 

From asking more of suppliers to beefing up stocks, Dean believes procurement models should be remodelled to favour resilience, mitigate risk and ensure the needs of the customer are kept in view. 

“The bottom line is that healthcare systems are expecting more from their suppliers. While transactional approaches focused solely on price and transactions have been the norm, collaborative relationships, where the buyer and supplier establish mutual objectives and outcomes, drives a trusting and transparent relationship. Healthcare systems are also looking to multi-vendor strategies to mitigate risk, so it is imperative for suppliers to stand out and embrace evolving procurement models.

“Healthcare systems are looking at partners that can establish domestic centres for supplies to mitigate the risks of having ‘all of their eggs’ in overseas locations. Suppliers should look to perform a strategic evaluation review that includes a distribution network analysis and distribution footprint review to understand cost, service, flexibility, and risks. Included in that strategy should be a “voice of the customer” assessment to understand current pain points and needs of customers.”

“Healthcare supply chain leaders are re-evaluating the Just In Time (JIT) model with supplies delivered on a regular basis. The approach does not require an investment in infrastructure but leaves organisations open to risk of disruption. Having domestic centres and warehousing from suppliers gives healthcare systems the ability to have inventory on hand without having to invest in their own infrastructure. Also, in the spirit of transparency, having predictive views into inventory levels can help enable better decision making from both sides.”

But, again, I had to ask, what about the risks and associated costs that come with higher inventory levels, such as expired product if there isn’t fast enough turnover, tying up cash flow, warehousing and inventory management costs?

“In the current supply chain environment, it is advisable for buyers to carry an in-house inventory on a just-in-time basis, while suppliers take a just-in-case approach, preserving capacity for surges, retaining safety stock, and building rapid replenishment channels for restock. But the risk of expired product is very real. This could be curbed with better data intelligence and improved technology that could forecast surges and predictively automate future supply needs. In this way, ordering would be more data-driven and rationalised to align with anticipated surges. Further adoption of data and intelligence and will be crucial for modernised buying in the new normal.

The Challenges

These are tough tasks, so I asked Dean to speak to some of the challenges. Luckily, he’s a patient guy with a lot to say.

On managing stakeholders and ensuring alignment on priorities and objectives, Dean says, “In order for managing stakeholders to stay aligned on priorities, they’ll need more transparency and collaborative win-win business relationships in which both healthcare systems and medical device manufacturers are equally committed to each other’s success. On the healthcare side, they need to understand where parts and products are manufactured to perform more predictive data and analytics for forecasting and planning efforts. And the manufacturers should offer more data transparency which will result in better planning and forecasting to navigate the ebbs and flows and enable better decision-making by healthcare systems.

Due to the sensitive nature of the information being requested, the effort to increase visibility is typically met with a lot of reluctance and push back. Dean essentially puts the onus back on suppliers to get with the times. “Traditionally, the relationships between buyers and suppliers are transactional, based only on the transaction between the two parties: what is the supplier providing, at what cost, and for what length of time. The relationship begins and ends there. The tide is shifting, and buyers expect more from their suppliers, especially given what the pandemic exposed around the fragility of the supply chain. The suppliers that get ahead of this will not only reap the benefits of improved relationships, but they will be able to take action on insights derived from greater visibility to manage risks more effectively.”

He offers a final tip. “A first step in enabling a supply chain data exchange is to make sure partners and buyers are aware of the conditions throughout the supply chain based on real-time data to enable predictive views into delays and disruptions. With well understand data sets, both parties can respond more effectively and work together when disruptions occur.”

As for where supply chain is heading, Dean says, “Moving forward, we’ll continue to see a shift toward Robotic Process Automation (RPA), Artificial Intelligence (AI), and advanced analytics to optimise the supply chain. The pandemic, as it has done in many other industries, will accelerate the move to digital, with the benefits of improving efficiency, visibility, and error rate. AI can consume enormous amounts of data to drive real-time pattern detection and mitigate risk from global disruptive events.”

 

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