Don’t be put off by the confusing headline. “Work funnelling” is the Korean term for the way the country’s chaebols – conglomerates such as Hyundai, Samsung and Hanjin – unfairly contract work to subsidiaries within the same organisation. In this case, it appears that Samsung SDS, the group’s IT services provider, has been awarded the logistics contracts for Samsung’s numerous other arms. Firstly this is a concern for Samsung’s existing logistics providers, but secondly, the experience it gains will be used when bidding for other logistics contracts. Korean 3PLs have begun to complain to the government about unfair competition: “The government keeps saying that it will help support logistics companies, but if it lets one chaebol take care of all the logistics work, there is nowhere for the other companies to go.”
