Friday, January 9, 2009

September 2005: Probably more about Warehousing and Latin American Cowboys than you would ever want to know!

Venezuela: I was in Venezuela the last week of August, visiting our plant and warehouse in Valencia. Valencia, two hours west of the capital Caracas, is the most pleasant industrial city I have ever been in.

One evening we went to restaurant called Rucio Moro. Rucio Moro is a very good parilla or grill, serving abundant quantities of beef, chicken and fixin’s in a most informal environment with very lively live music. It is more than this however. Rucio Moro is a restaurant chain owned by the renowned Venezuelan singer, Reynaldo Armas. He is the prominent singer of what I will call the Venezuelan cowboy culture: Musica Criolla

Rucio Moro is actually the name Reynaldo’s horse. Rucio means silver-gray. Moro means Moor or, in the case of a horse, white mark on the forehead. Reynaldo loved his horse. He wrote a song about the passing of the horse. It is his most famous song. The theme of the restaurants is the cowboy culture of Venezuela.

Statues and images of the horse are everywhere. The statues are full size replicas of the horse. One is of Rucio Moro standing; another is of the horse rearing up. There are numerous photos of Rucio Moro all over the restaurant. There are photos of Rucio Moro in the stable, in the pasture, running, with Reynaldo standing, and with Reynaldo riding. This guy loved his horse. But these photos were interspersed with action shots of what looked like Venezuelan Rodeos.

Venezuelan Rodeo? I learned that it is not actually a rodeo. The national sport of Venezuela is called Toros Coleados or Bull Tailing. Men, coleadors, on horseback chase a bull with the goal of grasping onto the tail of the bull and then trying to upend the beast. A rider scores a point only if the bull, for just a second, is fully on its back with its legs sticking straight up. It is a tough and dangerous sport. Grabbing a charging bull’s tail is hard enough but then flipping it is even harder. The rider must contort at all kinds of angles in sync with his horse to roll the bull.

It takes a special breed of horse for this kind of task. The horse must be both compact and incredibly strong. The Coleado horses are bred between two species to achieve the desired size and strength. Rucio Moro, I was led to believe, was such a horse. An entry level horse can cost $25,000. Prized horses go for $75,000 or more.

A Coleado is a day long event. Music abounds. Beer and scotch, mostly scotch which is definitely the national drink of Venezuela, flow very freely. Barbecues are fired up and filled with meat. The crowd is clad, well like cowboys, in jeans, big buckled belts, boots, western shirts, and cowboy hats. The stands are intimately close to the action. Every so often, a fan, not thinking clearly, will stagger into harms way trying to get closer to the action or to cheer his favorite Coleador. Riders, friends, or the simple luck of the completely inebriated often save such fans from serious injury.

The music is special as well. The Coleado Music is definitely country. It is also energetic. I even thought of it as Venezuelan Country Western kind of Rap as the singing is often closer to talking than singing. Singers will ad lib in creating a story and often singers will exchange back and forth trying to out ad lib or rap the other.

The instrumentation is standard. The lead instrument is a harp, a small four stringed guitar called a quarto provides the fill and harmony, and the percussion is solely form maracas. Along with a singer, this is the traditional band. Some years ago, with the advent of amplification, an electric bass was added to the mix. I really like this music.

A while back in Florida, some enterprising fellow, probably a Venezuelan, maybe even Reynaldo Armas, staged a Coleado in Tampa. Fifteen hundred people came. Shortly thereafter the Florida legislature deemed this animal cruelty and banned the sport. I cannot imagine this is much fun for the bulls.

Warehousing: Part of my job involves the management of warehouses in Latin America. I do not actually manage the warehouse on a day to day basis. People in our subsidiaries do that. I craft strategy and policy and then work to ensure the strategy is executed and we manage our facilities to our policies. It has been a fun job.

When I first stared, there was no central management of warehousing. Basically, when there is not enough management attention, people and performance tend not to be world class.
Furthermore, we did not put our best people in our warehouses. One of my close friends and esteemed colleagues, Angel in Mexico, always says that, “Warehousing was the waste basket of manufacturing.” When we had a mediocre performer, it was very likely he might get moved to warehousing thinking that “he can’t do any harm there, it is just a warehouse.”

Our warehouses were dimly lit and grungy. Often the spaces were attached to our factories which over the years had expanded by taking over bits and pieces of the warehouse. Thus, many of our warehouse spaces were not uniform but several rectangular spaces connected by corridors. Storage and stock rotation were haphazard. Some sites were kind of neat and others were simply horrible. You get the results you hold people accountable to by strategy, policy and measurements. As we had none of these, you can imagine the performance.

We decided to upgrade. We decided to upgrade our facilities and improve the capabilities of our people. Over the past eight years, every warehouse has been replaced or refurbished to world class standards… well world class standards for our industry. We have provided training and developmental short term assignments and job rotations for our people. We have even hired sharp young people with actual degrees in logistics. In Mexico, Brazil, and Colombia, we have been recognized by large customers like Wal-Mart as being the best amongst our peer companies.

When I travel, I not only visit our facilities but those of current and potential suppliers of warehouse services. We sometimes need space for overflow. At other times, we are looking to outsource our operations to third parties that can reduce our overall costs including inventory.

Brazil: We have a beautiful Mother or Main Warehouse in Sao Paulo. It was built in 1999. Over these six years, our business has grown in terms of volume and the assortment of products we offer. As a result, our Mother Warehouse is too small to handle the surge of business that comes at the end of the month and more so at the end of the quarter.

Do we build a new warehouse? That is certainly an option. I would rather build a warehouse and have everything under one roof. But, there is uncertainty in the amounts of exporting Brazil will do. There is a real possibility that our current Mother Warehouse might be the right size in 2008 or so. Building a huge, two football field sized warehouse violates a basic religious and warehousing tenet: You don’t build a church for Easter Sunday. Plus, building a warehouse is expensive and even if we lease it, the owner would want a 5-10 year commitment to recoup his investment and turn a profit.

Another option is to secure some “overflow” space. This makes me cringe. Not only do we incur more rent, but also increases in freight do to the shuttling product to and from the overflow facility. In logistics, a decent rule of thumb is to minimize the amount of times a case or pallet is loaded and unloaded onto a truck. With the uncertainty of our product portfolio and export strategy, an overflow site gives us flexibility expand or close as needed. We would negotiate the “divorce clause” prudently. Thus we would be free to get out of an overflow facility in six months if we no longer need it or decide to build a new one.

We decided to go with the overflow scenario and re-evaluate the need for a new facility in the 2007 budget.

There are two choices for our overflow warehouse. One is an extremely low cost bare bones facility that we would used just for space; shuttling product to our Mother Warehouse as needed. The other choice is a well run modern facility that meets matches our current standards for warehousing. We would use this facility not as pure overflow but as a productive facility to process orders and ship directly to customers. The pure overflow is cheaper for warehousing but would incur more freight cost. The more modern facility would cost more but the freight would be less. While I was in Brazil in late September, I went to visit both.
We will probably go with the more modern facility. The story here, though, and pardon the long lead in, is about my tour of the bare bones site..

The bare bones place was old, poorly lit, cavernous, and grungy. It reminded me of most of our warehouses of ten years ago. There were four sections each with arched tin roofs that looked like giant Quonset huts. The place was so old that the arched roof support structures in one of the section were made from wood.

The owner had us lead through a small lobby through part of the warehouse to his office. He had a nice roomy office and an out of place marble desk. He did not speak English. As my Portuguese is at best extremely weak, I was subject therefore to relying on my colleague Eduardo to translate.

We took a tour of the facility. I was impressed with two things. First, this was definitely a glimpse into our past. This facility in terms of age and general condition reminded me of the warehouses we had in our network before the modernization. Second, it was decently organized and neat for what it was. All the goods were stored on the floor and pallets were stacked three high. The floor was in good shape and as clean as you could get an old warehouse floor with a broom. We could definitely use this place as an overflow but I would not want to use it for anything more.

When the tour was over, we went back to the owner’s office. He gave me a bottle of Cachaça, the sugar cane liquor that is used to make Caipirinhas, the national drink of Brazil. I thanked him and thought we were done. Not quite.

The owner then pulled out his cell phone, came and stood next to me. This was odd but then I understood when he had a video on the phone display. It was of a horse, his horse. It was a fifteen second clip that I had the pleasure of seeing three times. I mumbled “nice horse” or even “what a nice horse” a few times and even asked, “Isn’t that a Palomino?” once. It was most definitely a Palomino, a golden Palomino.

Then he gave me a video. As he was handing it too me, I assumed it was a video of his facility and his company’s capabilities. I was oddly impressed that he would market such a bare bones operation with a video. I took the video and saw that it was a Roy Rogers movie. Well that explains the Palomino video clip on his phone. The movie was titled and dubbed in Portuguese.

We sat down, had some coffee. I thought we might talk a little warehousing. That was not the case. It was an opportunity for the owner to open his briefcase and proudly show me… more photos of his horse and all kinds of Roy Rogers memorabilia from fan magazines to catalogs. I was starting to get wierded out. But, I can go with the flow. I looked at everything, and feigned interest. I definitely was curious as to this guy’s Roy Rogers and Palomino hobby or obsession and even more curious as to why he was showing it to me. I understood the man wanting to share his hobby and passion with others but I could not stop trying to figure out how he thought this would help secure any business from us. With the face I maintained looking at the Happy Trails collection of stuff, I could have bluffed my way to victory in the World Series of Poker.

I recall saying to Eduardo, “Eduardo come here and have a look, more pictures of his horse.” For the second time in a month, I was thinking and this time expressed to Eduardo, “This guy really loves his horse.”

Finally we got out of there. We got in the car and I turned to Eduardo and asked, “What the hell was that all about?” Eduardo started roaring with laughter and so did I. I had a barrage of questions. Why is he obsessed with his horse? Roy Rogers? Why did he show me all that stuff? Eduardo could not stop laughing.

Finally, Eduardo told me that a week before the owner, knowing I was coming to visit, had asked him, “You know I don’t speak English nor do my people. How will I relate to this executive from New York?” Eduardo told him, “Don’t worry, Gavoor is a good man and will want to see your facility. I will do all the translating.” Then Eduardo related that he paused, thought, and then told the owner, knowing of his love of Roy Rogers, “You know, I have been to Gavoor’s house. It is like a shrine to Roy Rogers.” According to Eduardo, the owners eyes lit up and a smile came to his face.

I was set up. I was set up big time and world class. I expect this from my musician friends. I never expected this from Eduardo. Sure, we are good friends and definitely share some laughs. But, he really truly got me. We could not stop laughing.

Eduardo asked me why I did not take the video. I did not realize it was a gift, I thought he was just showing it to me like the catalogs, magazines, photos and cell phone video. It turns out that the owner actually paid to have this particular movie dubbed in Portuguese and had Trigger actually speak a la Mr. Ed. I was sorry I did not take the video. We laughed more thinking of how we might have offended our host given that he was of the belief that I was a Roy Rogers mega-fan. He had to be puzzled by my less than enthusiastic reaction. If it was not so funny, I would have really been mad at Eduardo.

Because of this, I did a little Roy Rogers web surfing. Here is what I learned:

- Roy Rogers, King of the Cowboys, was born Leonard Franklin Slye on November 5, 1911 in Cincinnati, Ohio. He died on July 6, 1998.

- Trigger, his Golden Palomino, lived from 1932 to July 3, 1965.

- Dale Evans, Queen of the West, was born Lucille Wood Smith on Halloween in 1912. She passed away on February 7, 2001.

- Roy Rogers was married twice. His first wife died in childbirth

- Dale Evans was married four times. Her first was an elopement at the age of 14.

- When Trigger died, Roy had the hide removed and stretched over a plaster likeness. Trigger was then displayed in the Roy Rogers and Dale Evans Museum in California. The museum has been relocated to Branson, MO.

- Dale Evans was a prolific songwriter. She wrote over 200 songs including their theme song “Happy Trails” and the Sunday School staple, “The Bible tells Me So (Jesus loves me yes I know).”

- Most of Roy’s movies were in color when all oaters of the 1930s and 40s were in black and white.

- Their only child died of Down’s Syndrome before the age of two.

- When Trigger died, the butcher that took the hide, John Jones, gound up the meat and sold it to a number of greasy spoon restaurants. He was sentenced to five years in prison for selling adulterated food… yuck!

- Roy and Dale were well known philanthropists advocating for adoption and many children’s charities.

- The Roy Rogers radio show ran eight years. The Roy Rogers Dale Evans TV show ran from 1951 to 1957.

- The both starred in over 30 movies.

Happy Trails to you,
Until we meet again…

No comments:

Post a Comment