PATAYA FOOD INDUSTRIES CO., LTD

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PATAYA FOOD INDUSTRIES CO., LTD

Date: 24/11/2008

PROCUREMENT DEPARTMENT

“Out-source and Satellite Strategy”

For year 2009

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Strategy 2009

1. UP shrimp 2. CP shrimp3. Whole Crab4. Crabmeat

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1. UP shrimp

Purchasing-Quantity = 1,113 MTBy PFIV for Out-Source =148 MT =>

OKBy Satellite for Out-Source = 480

MT=> OKBy Satellite for Satellite = 485

MT=> OK

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2. CP shrimp

Purchasing = 370 MTFrom Anh Duc = 220 MT=> OKFrom Hung Hau = 150 MT=> OK

Peeling = 341 MTBy Satellite = 160 MT=> OKBy Out-Source = 181 MT=> OK

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3. Whole Crab Purchasing By PFIV for PFIV= 500 MT-Bac Lieu / Ca Mau = 157 MT-Tra Vinh / Ben tre = 267 MT-Vam Lang = 53 MT-Kien Giang = 23 MTBy Satellite for Satellite= 500 MT-Vung Tau / Phan Thiet = 500 MT

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4. Crabmeat Purchasing By PFIV = 535 MT-Bac Lieu / Ca Mau = 21 MT-Vam Lang = 170 MT-Kien Giang = 57 MT-Import = 154 MT-Local Frozen = 16 MT-HCMC = 117 MT

By Satellite = 1,070 MT-Vung Tau / Phan Thiet = 1,070 MT

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4. Crabmeat

Picking = 258 MT

-By PFIV = 125 MT-By Satellite = 133 MT

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Out-Source StrategyOut-Source Strategy

Station JobNo. of

Wk

Efficiency (kgs./hr./man)

Hrs. /day

Capacity (MT/day)

Days/year

Working day

/year%

Total Capacity (MT)

CP UP CP UP CP UP

ThanhShrimp Peling 65 0.80 2.42 9 0.47 1.42 191 304 62.8 90 272

HanShrimp Peling 65

0.80

2.42

9

0.47

1.42 194 304 63.8 91 276

Total 130 0.80 2.12 9 0.94 2.84 193 304 63.5 181 548

Peeling budget 2009 (MT)

UP Shrimp 548

CP Shrimp 181

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1. THANH STATION1. THANH STATION

Address: Tra Noc ward, Binh thuy dist., Can Tho city Qty. of worker: 65 persons Shrimp peeling efficiency: 0.8 kgs/hr/person Working hours/day 9 hours/day Recovery: 33 % Output of CP shrimp per day: 0.47 MT/day Budget quantity for Thanh station: 90 MT/year Peeling days =90 MT/0.47 MT/day 191 days Total working day/year: 304 days Station utilization: 62.8%

Finding more jobs for this station to do =>crab picking ,etc.

1.1. Budget for Thanh’s station1.1. Budget for Thanh’s station

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Description Unit Qty. (MT)Cost

(VND/Unit)Amount(VND)

UP shrimp Mt 272 18,000,0004,896,000,

000

CP Shrimp Mt 90

Peeling cost Mt 90 5,700,000513,000,0

00

Alcohol usage Mt 90 301,87527,168,75

0

Ice usage Mt 90 557,81250,203,08

0

Labor cost (two workers)

Day 191 115,07821,979,89

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Traveling allowance (2

workers)Day 191 40,000 7,640,000

Total 90 61,288,7975,515,991,

728

1.2. Cost for peeling UP shrimp (Thanh station)1.2. Cost for peeling UP shrimp (Thanh station)

CP shrimp = 61,289 VND/kg

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2. HAN’S STATION2. HAN’S STATION

Address: Giai Xuan commune, Phong Dien dist., Can Tho city Qty. of worker: 65 persons Shrimp peeling efficiency: 0.8 kgs/hr/person Working hours/day 9 hours/day Recovery: 33 % Output of CP shrimp per day: 0.47 MT/day Budget quantity for Han’s station: 91 MT Peeling days =91 MT/0.47 MT/day 194 days Total working day/year: 304 days Station utilization: 63.8%


2.1. Budget for Han’s station2.1. Budget for Han’s station

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Description Unit Qty. (MT)Cost

(VND/MT)Amount(VND)

UP shrimp Mt 276 18,000,0004,968,000,

000

CP Shrimp Mt 91

Peeling cost Mt 91 5,900,000536,900,0

00

Alcohol usage Mt 91 301,87527,470,62

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Ice usage Mt 91 557,81250,760,89

2

Labor cost (two workers)

Day 194 115,07822,325,13

2

Traveling allowance

(2 workers)Day 194 40,000 7,760,000

Total 91 6,168,6995,613,216,

649

2.2. Cost for peeling UP shrimp (Han station)2.2. Cost for peeling UP shrimp (Han station)


***To pay peeling cost more than Thanh’station = 200,000 VND/MT(CP) to support her new station investment = 60,000,000 VND

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Satellite Raw material Purchasing Strategy Year 2009

Kind of RM.Budget 2009

Qty. (MT)

UP. Shrimp for PFIV 400

UP. Shrimp for peeled at Satellite 485

Whole Crab 500

Crabmeat 1,070

TOTAL 2,455

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Location

Qty. for Sourc

e

Quantity (MT)

Budget 2009

Jan Feb Mar AprMay

Jun Jul Aug Sep Oct Nov Dec Total

Phuoc Hai

485Vung Tau

0

6

21

21

61

61

67

76 79

63

30 0

485

PFIV. 400Vung Tau

11

15

16 26

40 42 59

51 46

39

30 25

400

Total

26

21

46

66

110

122

139 141

136

119

80 45

1,051

Strategy for success plan1. PFIV. can receive Rm. more than plan in high season2. The price purchasing can compete with Markets and others

packers in low seasons3. Can pay picking cost after convert to CP. 66,000 – 67,000 VND/KG.4. Can frozen UP. Cooked in case over PFIV capacity for out source

peeling in low season and frozen CP for canning.

Satellite UP. Shrimp Purchasing Strategy Year 2009

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Shrimp peeling (Phuoc Hai station)Shrimp peeling (Phuoc Hai station)

Address: Phuoc Hai , Long Dien District , Ba Ria – Vung Tau Qty. of worker: 150 persons Shrimp peeling efficiency: 0.8 kgs/hr/person Working hours/day 9 hours/day Recovery: 33 % Output of CP shrimp per day: 1.08 MT/day Budget quantity for Phuoc Hai station:

160 MT

Peeling days =160MT/1.08 MT/day 148 days Total working day/year: 304 days Station utilization: 48.7%


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Description UnitQty. (MT)

Cost(VND/MT)

Amount(VND)

UP shrimp Mt 485 17,000,0008,245,000,00

0

CP Shrimp Mt 160

Operation cost Mt 160 13,000,0002,080,000,00

0

Alcohol usage Mt 160 301,875 48,300,000

Transportation MT 160 1,000,000 160,000,000

Total 160 65,833,12510,533,300,0

00

Cost for peeling UP shrimp at SatelliteCost for peeling UP shrimp at Satellite


Operation cost include : Peeling cost , Oil , Ice , Station rental , Labors , Electricity Water

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Satellite Whole Crab Purchasing Strategy Year 2009

Location

Qty. for

Source

Quantity (MT)

Budget 2009

Jan Feb Mar AprMay

Jun Jul Aug Sep OctNov

Dec

Total

For Satellite

500

Vung Tau

5

1 3

3

5

5

6

5

5 4

4

3

52

Ham Tan

15

7

12

15

20

25

33

30

30

25

25

22

257

Phan Thiet

10

3 8

7

15

20

25

25

25

20

20

15

191

Total

30

10

23

25

50

50

64

60

60

49

49

40

500

Strategy success plan1. The price purchasing can compete with high quality market 2. Can pay picking cost about 80,000 - 90,000 vnd / day / person (W/K)3. Open the new source in Central of Vietnam (Nghe An)4. PFIV. Can receive whole crab in case satellite over picking capacity

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Crab semi-cleaningCrab semi-cleaning

Address: Phuoc Lam , Long Dien District , Ba Ria – Vung Tau Qty. of worker: 10 persons

Crab semi-cleaning efficiency: 30 kgs/hr/person

Working hours/day 8 hours/day

Output of whole crab 2.40 MT/day

Budget whole crab 500 MT

Peeling days =500 MT/2.40 MT/day 208 days

Total working day/year: 304 days

Station utilization: 68.4 %

1.Kim Anh station (Satellite)1.Kim Anh station (Satellite)

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Crab pickingCrab picking

Crabmeat from Satellite picking-Lump = 51 MT-WBM = 47 MT-Claw Mix = 23 MT-Red = 13 MT-Total = 134 MT

= 98 MT :Picking at Satellite

= 36 MT :Picking at Outside

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Address:Phuoc Lam , Long Dien District , Ba Ria – Vung Tau Qty. of worker: 57 persons Crab picking efficiency: 1.2

kgs/hr/person Working hours/day 10 hours/day Recovery: 26.5 % Output of crabmeat (Lump / WBM) per day:

0.68 MT/day

Budget (Lump/WBM) quantity for Kim Anh station:

98 MT

Peeling days =98 MT/0.68 MT/day 144 days Total working day/year: 304 days Station utilization: 47.4 %

1.Kim Anh station (Satellite)1.Kim Anh station (Satellite)

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Claw = 23 MT Red = 13 MT

2. Outside2. Outside

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Satellite Crabmeat Purchasing Strategy Year 2009

Location

Qty. for Source

Quantity (MT)

Budget 2009

Jan Feb Mar Apr May Jun Jul Aug Sep Oct NovDec

Total

PFIV. 1,070Vung Tau

42

24

29

54

77

98

119

138

153

161

103

72

1,07

0

Total 42

24

29

54 77 98

119

138

153

161

103

72

1,07

0

Strategy success plan1. The price can competition with high quality market and

competitors => YCC , Trinity , Sotico , etc.2. Can frozen in case over capacity production packing in high

season period3. Purchasing crab meat frozen in case fresh crab meat not enough

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Forecast to freeze crabmeat for stock in high

season 2009Crabmeat August Septemb

erOctober Total

WBM 40 55 20 115

Claw 20 35 10 65

Red / Nieu

5 10 5 20

Total 65 100 35 200In this case => For produce in Q1 ‘2010 => Must to have money

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