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Sunday, April 17, 2022

Value adding in the agri sector

Looking forward to the future of business



Zac Sarian on Edna Sanchez dragon frui farm

A classmate was who has a dragon fruit farm was interviewed by a famous chef as he cooked food in her farm using dragon fruit wine.   This classmate discussed what has been taught to her by DA - VALUE ADDING.   Rather than throwing away the fruit when prices descend to the  gutter, she turns the dragon fruit into wine; vinegar and more.

Oftentimew we are are confronted by "awa articles on"rotting vegies:  tomatoes, onions, potatos because of bad transportation and  bad market conditions   Farmers must innovate, think of new things rather than just complaining.   Stocks can be converted into cooked food or preserved meat if there is over production

Value adding

Friday, April 15, 2022

Accelerating creation of wealth by entrepreneurs by creating money

Looking forward to the future of business







It was an advantage that this post did not take up business courses while in the undergrad.  I did not have to be bound by business traditions and practices  It was a clean slate for me when I started wading into the business world

Our foray  into  öur business was a thrift bank.  While my mother spent almost 20 years in the rural banking as a cashier, the putting up of a new bank with existing competition was an entirely a new ball game.  

Aside from the secret of success as hardwork, keeping your word, and knowing your goals, one of the most important secrets that I learned is CREATING YOUR OWN CURRENCY (money)  


1.  In the banking system one thinks that the best way to grow is gather deposit. One thinks that banking is like having a piggy bank that you fill up with deposit.    It does not happen that way.  The best way to grow is to create credit  to lend.   Lending creates money so many times depending on the reserve requirements:    x10 if reserve is 10%   5x if reserve is  20%.   Thus with the rural bank, having P1 million deposit, we would most likely to guess that we will get only a fraction of that deposit.   But we ended with P5 million deposit after one year.   And five years after, we had P100 million.

     from Google

Most of the money in our economy is created by banks, in the form of bank deposits – the numbers that appear in your account. Banks create new money whenever they make loans. 97% of the money in the economy today exists as bank deposits, whilst just 3% is physical cash.

2.  We utilize this powerful tool of capitalism to create wealth from nothing.    The central banks have about P10 b in capital, but becomes a platform to trillion of GDP, loans and currency in circulation

      Central banks create funny money.    When they lend money to banks, (under a rediscount or
      repurchase agreement, they simply Dr. Loans, and Cr.  Bank Deposits to their reserve account
      No money changed hands, no actual money was sourced by the Central Bank

     Thus China CBs were smart.  They created loans from nothing and bought  commodities, oil
     and coal, and or other blue chip companies, and in the process increased Chinas wealth, In the
     country behest loans drained the resources of our Central Bank (case against Marcos)

3.  Firms like the SM group use this seminal idea to speed up their growth.   Its growth being limited
by limited spending power of consumers,  SM embarked on selling POs through agents, dealers who were given 5 to 10% discount for financing the said PO.  They were payable in 2 mos.  POs radically increased sales volume of SM and their affiliates.

They replaced this later on with their purchase of ACME bank (now BDO) which offers more convenient credit cards.

4.  Car companies and dealers cant boost their sales without installment sales, and car loans offered by banks who are cobranding with them

5.  For our business group:

       1.  We created real estate companies partially with equity from the bank (allowed by PD 71 and 72)
          and loans (properly secured)

       2.   We bought properties under contract to sell (with partial  dp)  through the created real estate
          companies

       3.  We created PN via the  Contract to Sell (another money creation)  Had we gone a step further,
          we could have borrowed against these contract to sell.  The sales proceed were deposited with 
          the bank

      4.  Or we required 30% dp, the properties were mortgaged wth the bank for the balance.  (These
        were choice properties located along the highway in front of public market near the church
        The 30% dp and the proceeds of the mortgage were deposited with the bank.  This caused
        ballooning of deposits and assets of the bank, and of the real estate company

6.  That is why, Japan through JICA and US through USAID finance road constructions and other
     worthy projects.   They do not only help develop the markets for their home country products
     but generate entrepreneurship in the donee countries.  When there is entrepreneurship, ,there is
     progress.

7.  That is why we also established lending investor company  (to lend to our market) and foundation to
      emulate this business model of Western Countries.  They worked.   




Thursday, April 7, 2022

Lack of storage facilities and logistics cause of problem in onion production a business opportunity

Looking forward to the future of business

A ranking regional officer of a government department was being interviewed this morning regarding the onion smuggling and status of onion production in an island province.  Again the imbalance in production and marketing, logistics resulting in destruction of  the produce.

The cause was in 40 years the same:   incomplete logistics and lack of storage facilities.  

This is seen as opportunity to put up storage facilities so that the farmers can wait for the best prices   The  officer of the said office must be trained to 1. To think outside of the box of the agriculture  things, 2.  To grab resources that are beyond the scope of govt budget  3.  To enlist the assistance of private sector

So maybe we can help the govt solve the perennial problem?



Substistence farming vs entrepreneurship

Looking forward to the future of business

In the course of teaching entrepreneurship at GSB, one of the projects of the students is to bring in entrepreneurs the group knows.  Brining in the entrepreneurs get the the group an A and I am sure the students this post and the students learn a plenty.

One of them was Dr. Tito Contado, from Los Banos owner of the a nutrition supplement. (President Pilnoni)     He is now deceased.  Pilnoni

One of the things he mentioned was that he was a FAO consultant for several decades and got numerous assignments around world.  His concern was agriculture.

He however regretted the  assignment because he promoted subsistence farming which  hardly raised the standard living of the farmer.


  The farmer produced only one product mostly for his and family needs, and he had to go to the marketplace to buy his other need.  However if they taught entrepreneurship, the farmers group and the farmers would be encouraged to 1.   market more products   2.  Process some of their products,   3.  Produce handicrafts, 4.  Rationalize marketing, procurement, and common facilities.


   



Contribution of this post to entrepreneurship development in the country

Looking forward to the future of business



href="https://www.slideshare.net/profjorge_entrep/prof-jorge-entrep-teaching-entrepreneurship">https://www.slideshare.net/profjorge_entrep/prof-jorge-entrep-teaching-entrepreneurship

One can see a surge of many start ups and new businesses format in the country    we deliver, fintech, food stall, coffee shops, snack bar, glamping, camping, bike tours destination 

Many have been agile and flexible.   The number of new enterprises is not known,   This does not include many form of scammers and crimes:   investment scarms, romance scams, selling scams which are nothing more than illegal way of raising funds for their needs.   Scammers are more numerous than ever. There is a surge in the number of Doctors Hospital which saw private sector improving health services (which was normally the responsibility of the govt)

There are many factors contributing to this:   like efforts of DTI to promote entrepreneurship, Go Negosyo which is now Cabinet post,  franchising, many new business consultants.

But this post is happy to have been part of this movement:

1.  Teaching entrepreneurship in a grad school of business for 13 years (despite other opportunities to build business)

2.  Striving to have business branches to be a success and be a model for service and excellent operations

3.  Posting ppt at Linked in (about 50 of them for free)  I noted and  it was admitted by a professor that
he based his lecture on business admin on these ppts.  The views on this ppt at Linked in (Slideshare)
have thousands of view from here and abroad.  Some of the ppts have nothing similar in the net.  

These are my attempts to make a dent in the universe

                                           With Prof Larry Farrel, former Pres of Problem Solving Co (KT)
                                                      Intl Expert on Entrepreneurship








Three masteries needed for business success

Looking forward to the future of business

Many are led to believe that to succeed in business, you need:

1.  Plenty of funds -  plenty of capital, borrowed capital, 
2.  Plenty of luck - feng sui, blessing from Patron saints, amulets, your lucky day or year
3.  Hustle

Indeed that seems to be the common knowledge and tactic.  Just this morning at the pan de sal store, there were talks about an altitude challenged businessman who tried to build 2 more restaurants in the town. (He has a big restaurant along the highway).  But the two - one in the poblacion, one in noted subdivision did not survive long)

Indeed the grad schools were right  You need three masteries:

1. Mastery of self
2.  Mastery of the opportunities
3.  Mastery of the enterprise

Mastery of Self     Not all can be entrepreneurs.   If all were, then there would be no buyers.   Only 2% can be entrepreneurs.  And even then, not all are born. but are to be shaped by education and more long long years of experience  Many lack the courage and leadership and determination to pursue a business concept or plan.  You many have wrong reading of opportunity But you persist and are determined you  may succeed.  You may not succeed if you are busy with Jaycees, with Rotary or Lions.   Your energy is not focussed and is dissipated.

Determination and persistence alone are omnipotent.   Parrots Ray Kroc  (Michael Eaton) of McDonalds Says Calvin Coolidge

Mastery of opportunities.  You must learn to trust marketers, product researchers and yes surveys.  If you can not afford it, do a due diligence which can take the form of Focus Discussion Groups (prospective customers) who could advise you on the feasibility of the venture.   You may propose to enter into restaurant business You only have 3 tables but break even is for 6 tables  (You only have customers during lunch and dinner.  The computation changes if you have take out or delivery services)

Mastery of the enterprise.  This is continuous and never ends.  When you wake up in the morning you think of nothing except the improvements you can introduce into the business and or the problems that you need to solve, and a long term solution to eliminate or mininize the problem.  When you stop doing
this the business stops and collapses.



3 important formula for business success for start ups

Looking forward to the future of business

In the Philippine business news, many stories of business successes were discussed like Angel Burger, Don Benitos etc.  And common among the  formula were:

1.  Focus emphasis on customers.  Customers come first.  Design your product and processes around the customer

2. Be outstanding and unique:   in your product offering, site ambience being the best;

3.  Innovation.  The owner, the entrepreneur continuously provide customer wants and needs better than competitor.  Daily Always

Other variants are:  good processes, strict financial planning and control.  But common to all are the three



Sunday, March 13, 2022

Making an Eastern Samar town productive

Looking forward to the future of business

The post was able to watch this afternoon the story of Dolores Eastern Samar and how its energetic and imaginative mayor was able to raise the productivity and progress of the town.  He invited investors and made the ease of doing business easy.   He had the Christmas village program and  encouraged the sale of local products and delicacies.   

The town is bustling with economic activity . We see this success story in many parts of the Philippines.  The local execs of the LGU should be congratulated. And these initiatives must continue

This place used to be sites of NPA activities









Raising minimum wage

Looking forward to the future of business

With the following price pressures:   weekly price increase of prices of fuel, increase in price of basic goods, (also due to Ukraine war) the pressure on is for petition for wage increase with some of quarters requesting  for as much as P200.00/day increase

Defnitely, the bulk of businesses are at a quandry as to where they can get this or source this amount.  A P200 per day increase would amount to P4,000 per month or P48,000 a year.   If you have  `50 employees that would be a about P2,400,000 and their margins would be wiped out.

Only exporters, MNCs, the 5% of the total employers would be able to afford this.   This is a difficult decision making.   

Saturday, March 5, 2022

Changing fortunes with the decline in covid 19 cases

Looking forward to the future of business

While we welcome the reduction (only 3 digits yesterday) in number of covid 19 cases, this is ominous for companies engaged in health care and services    hospitals, medical suppliers of equipment PPE vaccines, test kits, medicines and the like

Face to face business will prosper this can mean reduction in volume of couriers and other facilitators of on online business. Some may even go out of business just like the pandemic closing many face to face business..  The pandemic has been particularly hard on airlines, tourism, bus and transportation, schools which are mostly face  to face.    Many schools just to retain their faculty have to obtain huge loans to continue paying for their salaries,

All ready fast food and airlines have recovered and away from bankruptcy .  But a cruise ship sailed its last.





Prayers to those who can make it, and kudos who will survive.