1. Coco Coir and the Business of Empowerment
by Maitet Diokno-Pascual Pilipinas Ecofiber Corporation
Presented at the FSSI Forum on Social Enterprises in the Coco Coir Industry, SM Megamall, Pasig, Metro Manila, 28 November 2011

2. Pilipinas Ecofiber is …
Engaged in the extraction of fiber & peat from coconut husks, and the processing of fiber into high quality stitched & woven coir products for sale in the Philippines and abroad.
Organized to link input providers, small producers & processors, with traders & distributors of various coir products, and to coordinate the activities of the former in order to meet the requirements of final users.
A business system which selects coir products and the appropriate technology with an effective organization of all actors in order to access the market in a financially, environmentally and socially sustainable manner
Coconut
husks
Coco fiber
& cocopeat
Coir ropes
&
mats
Geonets,
plant liners,
trays, etc.
Final
sale
Traders, direct buyers
Husk
collectors
(small biz)‏
Rural workers
Rural coops
Small biz
Plant workers
Twining agents
Weavers &
Edgers
Associat’ns

3. Plant Workers (3) Weavers & 130 twining households in Bicol
Our network
Husk
collectors
(small biz, 3 persons)‏
Rural workers (21)
Rural coops (3)
Small biz (1)
Plant workers (10)
Twining agents (7)
Plant Workers (3) Weavers &
Edgers
Associations (2)
130 twining households in Bicol
1 association with 24 members, another group with 26 members, all in Bicol
Estimated members in all
About 50 coconut farmers in Quezon

4. Pilipinas Ecofiber’s basic functions
Specific
Inputs
Production
Transformation
Trade
Final Sale
Extract fiber & dust from
husks;
Purchase fiber
from other producers
Purchase
coconut
husks;
Fabricate & maintain
equipment
Stitch fiber into mats, liners, etc.;
Outsource twining of ropes & weaving of nets;
Control quality;
Finish, bale & pack;
Coordinate these
Transport
Distribute
Sell

5. Pilipinas Ecofiber’s bottom lines
Economic and financial viability + Environmental sustainability + Social Equity = The business of empowerment

6. Some caveats
While Pilipinas Ecofiber has been in existence for more than 30 years, it has only been since when FSSI acquired it that the company adopted a triple bottom line approach to business.
Managing the ownership transition itself a challenge
Not easy to transform a company that was run largely as a single proprietorship
Getting everyone on board who has long been used to the ways of the old man and his managers is a challenge
Workers/contractors want/need steady income and work, who cares about triple bottom lines
Ways of the past needed to be addressed and changed

7. Where people matter Knowledge and crafts Hard work and discipline
Handed down from generation to generation
Acquired through time spent in the business
Through practice of skills and profession
Through research and development
Shared among industry players here and abroad
Learned from buyers
Hard work and discipline
To maintain quality
To deliver required volume of work on time
Creation of value
With the right mix of machine, craftsmanship & imagination

8. In brief Without people the company doesn’t matter
Without profit the company can’t help others
Pilipinas Ecofiber is moving towards making itself a company that helps communities grow through environment friendly processes as an integral part of its profit earning business.
We are in the business of empowerment.

9. Where we come in
Provide a structure within which to put all these talents together to produce high quality coir products
Market
Equipment
Working capital
Logistical support
Provide a business organization to develop implement and monitor a viable business plan
Institute a working relationship that is mutually beneficial and empowering
On the basis of mutual respect and fairness
At the same time, provide mechanisms and incentives to instill business acumen and raise stakeholder claim in the company

10. Our humble contribution
Try and provide a steady source of employment and income for workers, small producers, small businesses
Needs strong and sustained market base
Thereby providing a steady stream of much needed cash to communities and enterprises
As long as we pay on time and without unnecessary delay
Women in rural areas included
Constantly finding ways to raise productivity and improve efficiency, thereby raising the income earning capacity of all in the supply chain
While maintaining market competitiveness
Add to knowledge and skills base, discipline, as well as business acumen

11. Viability track record & progress

12. ‘Typical’ Supply Chain
Husk Suppliers
Other Deco Plants
PEC Deco Plant
Fiber Export Market
Peat Markets
PEC Bicol Plant
PEC Stitching
Plant
Local bedmakers,
bioeng'g contractors
US/Korea buyers
Twining
Coops
Weavers
Associations
Local/foreign buyers of coco nets
Foreign/local buyers of coco ropes

13. Social Enterprise Chain
Husk Suppliers
Other Deco Plants
PEC Deco Plant
Fiber Export Market
Peat Markets
PEC Bicol Plant
PEC Stitching
Plant
Local bedmakers,
bioeng'g contractors
US/Korea buyers
Twining
Coops
Weavers
Associa-tions
Local/foreign buyers of coco nets
Foreign/local buyers of coco ropes
$$$ Export
Infra / ecosystems dev’t:
Cost-effective interventions
Environment- friendly
Indirect livelihood generation:
3 husk suppliers (About 50 coconut farmers)
3-4 other deco plants
200 families of twiners, weavers & edgers
Economic/Social
Husk waste utilization
Environmental
Support to local enterprises
Environment-friendly
Organic fertilizer for horti- & agriculture
$$$/ ¥¥¥

14. How value is shared

15. How value is shared

16. Social Equity 5-Year Plan

17. Challenge: Sustaining the Chain
Pilipinas Ecofiber depends on many small businesses: husk suppliers, small coir producers, rural workers, twining households, weaving associations
Sustaining this chain is a challenge
We need a broadened market base and steady inflow of orders to ensure steady work and income
Financial resources throughout the chain must be strengthened
Ideally to shift from hand to mouth existence to some level of savings to support the times when orders are weak
Pilipinas Ecofiber, while its own cash position is challenged from time to time, is conscious of the need to remit payments in a timely manner
Protecting value at the lowest end of the chain
Not participating in a race to the bottom
Finding ways to improve productivity and efficiency

18. What if …
DPWH / PNoy Government were to make good on its commitment to procure 2 million sq m of coco nets?
major MAJOR contribution to rural employment: rope twining and weaving of nets, not to mention fiber production
support to SME sector and coconut sector
support to social enterprises
primary producers, POs, coops & microfinance
Appropriate gov’t support to coir R&D leads to commercial utilization of peat and other coco-fiber products?
WOW! Small farmers can think big with just one hectare of land
More eco-friendly industrial & commercial horizons (architecture, engineering, apparel, houseware, etc.)

19. Very clearly
Support to SEs like the coco coir subsector is one sustainable poverty reduction intervention that goes much further than the Conditional Cash Transfer (CCT)

21. Maraming salamat po!