Академический Документы
Профессиональный Документы
Культура Документы
ACKNOWLEDGEMENT
The group would like to thank the following for their contributions in the making of this
company study.
To SACDEC (Sibunag Ati Community Development Cooperative) for allowing the group
to study their company and to learn more about actual business operations and processes.
To Mrs. Gemma Chavez Valenzuela for relentlessly giving us the necessary and
To Mr. Manuel Ocampo for giving us an opportunity to discover and experience the
actual world of business through his enormous effort for requiring the group for a company
study.
To the Almighty and Loving Father who bestowed upon the researchers the
And to all the group members, Jiahra Mae D. Maravillas, Jhennilyn J. Arreglado,
Arshie David, Fredrick Valle and Marc Gretel R. Madanguit for their cooperation and
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Introduction
Background
production and even service activities. Operations management involves product and service
design, process selection, selection and management of technology, design of work systems,
location planning, facilities planning, and quality improvement of the organization’s products and
inputs into outputs. Inputs such as capital, labor and information are used to create goods or
services using one or more transformation processes. Best strategies are often required to
continuously satisfy old customers and attract new ones. In the operation of handicrafts, these
activities are very much applied. The customers of which are the retailers of hand woven bags
who sell these products for souvenirs and the like. The important employees are the members
of the cooperative who do the weaving of these handmade bags. Like all other firms, the
handicraft industry has three basic functional areas: finance, marketing and operations.
indigenous people of “Ita” community in Liningwan, Sibunag, Guimaras. It was formed through
the full cooperation of the “Ita” in the area. It is a 2-year old cooperative that aimed not only to
give livelihood to the “Ita” group in the community, but also to nurture their God-given skills,
The cooperative has started with 27 members, but has continually declined today to 16
members with only 6 members who are weaving when supplies are needed by their respective
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
partners. However, the marketing in-charge of the cooperative, Mrs. Gemma Valenzuela, is
conducting regular trainings and workshops to increase the manpower of the cooperative and
gain more income from the products they produce. The management group of the cooperative is
composed of the chief executive officer in the name of Pastor Dennis Bautista with his
associates, Mrs. Gemma Valenzuela (Marketing in-charge), Mrs. Marita Magbanua (Quality
Control), Mrs. Norilyn Bautista (Bookkeeper), Mr. Ode Inagan (Audit Inventory), Lydia Arevalo
Hand-made crafts are undeniably durable products. Capitalizing on the raw materials
used and the manual efforts of the members, the products are surely reliable and long lasting.
These products are what tourists usually buy as souvenir items. In addition, most people also
love and prefer the beauty of hand-made products rather than rubberized or synthetic materials
not only because they are environment–friendly, but because they are also fashionable.
SACDEC does not only want to gain income out of weaving. They also wanted to impart
to the buyers and the rest of the people the value of patriotism and nationalism by buying
products that are made locally to help strengthen our economy and help our fellow countrymen
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
The study intends to determine the manner of the daily operations of the Sibunag Ati
Community Development Cooperative (SACDEC). Eventually, this paper also aims to formulate
and recommend alternatives of action that could possibly help in the improvement of the
• Describe and analyze the current status of the enterprise relating to the:
b. Communications Flow
g. In disposing/segregating wastes
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
• To determine, assess and evaluate the quality control methods it uses for their products;
and
• To determine the efficiency of their operations that could continuously satisfy customers
The study was conducted to help in the improvement of Sibunag Ati Community
Development Cooperative. The results of this study will help the enterprise improve its current
operations. Expectedly, it will widen the firm’s view of the business. Moreover, it is expected that
the strategies the proponents will recommended can solve certain portion of their problems that
will help the management team of the enterprise go further about the business and will have a
The study was conducted at Liningwan, Sibunag, Guimaras on July to September 2009.
It focused on the operations of the enterprise as a whole. The data gathered are all considered
first-hand/primary sources since it was generated from an interaction with the major
respondents of this study. Majority of the information came from Mrs. Gemma Chavez-
Valenzuela, Head of Operations of SACDEC as well as the Marketing in-charge. Other sources
of information include the Taytay sa Kauswagan Inc. (TSKI) and the other members of the
enterprise.
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Methodology
Research Design
The study makes use of the descriptive-analytical technique especially the focus groups
method. Such method is useful in attaining information that is difficult to obtain with other
methods. This method is also used to set in-depth information and reactions to a relatively small
number of topics or questions rather than to get answers to a large number of questions. Here,
participants to encourage an in-depth point of view. The homogeneity helps assure that
individuals will not be afraid about the issues at hand (O’Sullivan and Rassel, 1995).
Guimaras is an island province of the Philippines located in the Western Visayas region.
Among the smallest provinces, its capital is Jordan. The island is located in the Panay Gulf,
between the islands of Panay and Negros. To the northwest is the province of Iloilo and to the
The province is located on the islands of Guimaras and Inampulugan. It was a sub-
province of Iloilo until it was made an independent province on May 22, 1992. Located
southwest of Panay, Guimaras is separated physically from Iloilo by a narrow channel, which
takes about fifteen minutes to cross by pumpboat from the Ortiz landing on Iloilo to Jordan.
There are two other ways to get there, the Parola wharf in Iloilo to the municipality of Jordan.
The Parola wharf is used exclusively whenever the water is rough. There is also a roll on roll off
(RORO) ferry that travels around five times a day and is used by the Iloilo bicycle clubs on
Sunday to travel to Guimaras. Geologists opine that the island formed one landmass with Panay
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Guimaras is also famous for its beaches. Clear blue waters, white sand and marine life
rivals that of Boracay. Commonly visited ones are at Roca Encantada, Alubihod and Puerto del
Mar.
The province is basically agricultural with palay, coconut, mango, vegetables, livestock,
poultry and fishing as major products. Its major industries are tourism, fruit processing, coconut
processing, fish farming, handicrafts making, mining, quarrying and lime production.
Guimaras is well-known for its agricultural crops, particularly mangoes, where some
50,000 of these trees are planted. The Guimaras Island is famous for producing the sweetest
mangoes in the world. Guimaras mangoes are reportedly served at the White House and
Buckingham Palace. Guimaras' largest event of the year is The Manggahan Festival (the
Mango Festival). The varieties of mangoes produced are also best for making dried mangoes,
municipality in the province of Guimaras, Philippines. According to the 2000 census, it has a
population of 20,104 people in 3,843 households, and it has 14 barangays with in the
municipality.
Sampling Design
There is no specific number of sample populations that the proponents required. They
look at the adequacy of the information that the members of the enterprise can supply.
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Data Collection
The respondents of the study included the coop members of the Sibunag Ati Community
Development Cooperative (SACDEC). The choice of the number and type of respondents was
based on the respondents’ ability to provide adequate data and information of every company
that is needed in the study and not necessarily in conformity to a particular sampling technique
The primary data was obtained through an accumulated interaction with the members of
the cooperative. Every time the proponents go to the place, interactions and unstructured
The secondary data that focused on some other details about Guimaras and Sibunag
The data generated from unstructured interviews and conversations were coded,
Descriptive and statistical analysis of primary data was made with the aid of certain statistical
techniques. Descriptive analysis of the data was done using frequency distribution and
percentages.
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Conceptual Framework
Definition of Terms
For the readers to fully understand the study that has been conducted here are some
1. Raw Materials – refer to things that are used to produce the final products of
SACDEC.
2. Buri – are long narrow stripped of palm. Additional accessory in the making of
4. Pandan – Primarily use in the making of shoulder bags and other native
materials.
5. Abaca – one of the raw materials used to make the products; these plants yield
fiber.
6. Dye – the solution or substance that is used to color the outer portion of the
products.
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
7. Water – were dye is soaked to produce the desired color and apply to the final
products.
9. Sewing Machine – the machine used for sewing the zippers and edges as well
10. Cutter – is a sharp materials used to cut the raw materials into strips.
12. Products – the final material that results from weaving the materials.
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Company Profile
History
indigenous people of “Ita” community in Liningwan, Sibunag Guimaras. It was formed through
the full cooperation of the “Ita” in the area. The chief executive officer of the cooperative was
Pastor Dennis Bautista with his associates, Mrs. Gemma Valenzuela (Marketing in-charge),
Mrs. Marita Magbanua (Quality Control), Mrs. Norilyn Bautista (Bookkeeper), Mr. Ode Inagan
(Audit Inventory), Lydia Arevalo (Treasurer) and Mrs. Jenelyn Chavez (Purchaser). The
SACDEC is known to generate income through their native products that were weaved
and made into materials like bags, wallets and purses. It was fully assisted by TSKI (Taytay sa
operation with a capital of Php 7,500.00 in August 15, 2007 with 27 members. This capital was
used to buy the raw materials like buri, pandan, nito and abaca that they need to make the final
products. Materials were purchased from nearby town and to the wild of the said place where it
was abundant except for abaca which was purchased in Janiuay, Iloilo.
For some time now, Trappist which is also located in Guimaras had been SACDEC’s
business partner. Their finished products were delivered to this retail outlet where they are
displayed for final costumers to purchase. They also engage in direct marketing wherein they
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Currently, there are only 16 members left with only six master weavers who make the
products. Since orders are currently increasing in number and they can’t cope with the demand,
they were training additional people to help them with the job. Together with TSKI, Trappist and
other potential investors and customers, SACDEC is likely to reach the national market with
Mission
polling of resources so that everyone’s needs are meet. By using our God given power and
ability to gain wealth, and working with our own hand that is good. That we may have something
to give to those who are in need as faithful steward of the manifold grace to God.
Vision
To see SACDEC members experience prosperity and physically healthy under God’s
sovereignty.
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
1. Skilled Workers – they are masters of their own selves, they are well-rounded and
2. Determined – they see to it that once they are committed to do something, they find
4. Resourceful – they are inventive people. They create products through the use of
materials that are available to them. With the use of this available resources, they
5. Innovative – they are very creative people. Most of the times they create new
products and do not only follow what the market has to offer. They make products to
be demanded by customers.
6. Industrious – they are hard-working people and despite the many obstacles that they
are facing they tirelessly find ways to solve them. When there are product demands,
7. Unique – they are considered as part of the indigenous people in the Philippines thus
contributing to their unique and original Filipino characteristics that they have
8. Environmentalist – they see to it that in everything that they do they do not harm the
environment. They believed that the environment is in one with them. They also
acknowledge the idea that whatever they do it reciprocates with the environment.
9. Morally Upright – they see to it that they do the right things according to norms of
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
10. Law Abiding – they are bounded by the legal principles of the government and they
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Organizational Structure
The type of ownership that is being followed by SACDEC (Sibunag Ati Community
Board of Directors
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
This presents the hierarchical order of the Operations Department of SACDEC (Sibunag
Ati Development Cooperative). Since the organization has not been fully established and some
members of the cooperative are illiterate and unfortunately incapable of holding some important
responsibilities in the organization, Mrs. Gemma Chavez Valenzuela, the Marketing in-charge
also acts as the Operations Manager of the weaving/operations department. Other members
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Flow of Communication
Every time an order is placed, Mrs. Gemma Chavez Valenzuela will inform the
cooperative’s auditor Mr. Audie Enagan or Lydia Arevalo so that they can give appropriate
amount needed to purchase the needed raw materials. Ms. Jenelyn Chavez, the purchaser will
then buy the raw materials like buri, pandan, nito and abaca from their respective suppliers.
During the making of the products, Mrs. Marita Magbanua, the head for quality control
operations checks the product to free it from defects at the same time assure that the quality of
the product will not depreciate as it is transferred from the production site to the final customers.
After the sale of the product, the capital used to make the products was then returned to
the cooperative that have the share of 70% from the revenue. This will be shared by the
members of the organization. The remaining 30% revenue is then given to the people who
weaved the ordered products. This is to ensure that their weavers are continuously motivated
In most occasions, information regarding meetings and other special gatherings are
placed outside the SACDEC’s headquarter near Sibunag Public Market. Since the area is
frequently visited by SACDEC’s members, there are fewer chances that they will not know
about the meeting. Nevertheless, it is the initiative of the members of the organization to inform
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
During the meeting, the members of the organization are updated or informed of the
current situation of the organization. This also serves as their social and interactive gathering to
held to address some important issues and to review the situation of the organization. It is
during this time wherein critical issues and problems regarding the organization are discussed
and if not fully solved will be partially given solution to remedy and minimize existing problems.
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
functioning properly and members are properly taken care of. He oversees possible
problems and remedies them. He calls and initiates meeting. Aside from his
managerial responsibilities, he also acts as agent who sells and promotes products
2. Gemma Chavez Valenzuela – the Marketing In-Charge of the cooperative. Her job
specializes in the marketing of their products. She sees to it that their products will
contacted in cases of orders made by direct costumer, the TSKI or the Trappist.
3. Marita Magbanua – the Quality Control Officer of SACDEC. She sees to it that during
production, the materials used are of good quality so that the final products will not
be affected. Before the product is turned-over to the final costumer or retailer, she
checks on the products’ condition and sees to it that it is properly handled during
4. Jonilyn Chavez – the cooperative’s Bookkeeper. She keeps all of the company’s
records and transactions. She keeps documentations and receipts and in case of
problems and other finance-related issues and concerns, she reports to the auditor.
5. Audie Inagan and Lydia Arevalo – SACDEC’s Audit Inventory Officers. They oversee
the company’s financial stability. They are responsible for keeping the money of the
cooperative. They report to the members everything about the financial standing of
the organization and they see to it that profits are properly distributed among the
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
shareholders of the organization. In cases of new products, they are the persons
product. They make sure that money is available in buying raw materials that are
needed.
6. Jenelyn Chavez – the coop’s purchaser. She makes necessary transactions to the
supplier of their raw materials. She buys the product and negotiates to their supplier
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Financial
The Sibunag Ati Community Development Cooperative for two years of their existence
has been experiencing problems especially in their financial aspect. They are having a hard
time finding enough capital to start a larger production. The Php 7,500.00 starting capital is not
enough to pay for their monthly dues and the legalization process for the registration of their
business to the Department of Trade and Industry. There are also other fees that they have
Human Resource
There were 27 members in the start of the cooperative. But as years passed, this
number has continuously decreased to 16 members in year 2009. Aside from that, they lack
good and efficient weavers who are the business’ primary assets. For years, they have initiated
activities like training of new weavers so that the organization’s business can be sustained. But
because of the lack of motivation of some members of the organization, they were not able to
train enough people who have the potential to make good quality products.
Currently, there are only 6 master weavers who actively participate in the making of the
final product of the organization. But this manpower is not enough to accommodate orders in
Illiteracy is also one of the problems that SACDEC is experiencing. Since some of the
members of the cooperative are unable to read or write or both, they cannot hold key positions
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Operations
SACDEC is not using any advanced equipment or machinery in making their products.
The production process merely depends on the weavers. In cases when the weavers are not
available, production process is always interrupted. Also, they are not using any drying system
which is necessary in the making of the final product and they drying of the raw materials like
nito and buri solely depends on the weather condition. In cases of typhoon and rain, there is a
Time is also one of the concerns of SACDEC. They don’t have fixed time in making of
the product. The weaving of product depends upon the availability of the weavers.
Marketing
Since they have problems in the financial aspect of the business and that the products
that they can actually supply is usually less than the actual demand, they cannot give the
products their retailing outlet, Trappist, needed. Sometimes they have problems in their
production and they are not able to deliver products either to Trappist or TSKI.
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Financial
Proper formula for the costing of the product should be strictly followed by the
organization to meet with the pricing of the industry. Every business transaction should be
properly kept so that they can keep track of the changes in costs and this can aid in their
Human Resource
Since human resource is one of the main concerns of the business, they see to it that
they are able to train and motivate existing members of the organization to weave. This will not
New strategies were initiated by the board of directors and the CEO to motivate the
employees. They emphasized on the individual 30% share in every product sold. As additional
motivation, some of the boards of directors are present during the training and they always uplift
the confidence of their trainees especially those who are easily depressed.
While training some of the members to weave, it is wise to invest some time on
educating some members of the cooperative to read and write. This will help them fully
understand the constitution and by-laws of the organization and with understanding comes
responsibility.
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Operations
SACDEC plans to increase the number of their output by at most 50% per month
considering that in most cases they are not able to meet demands by their customers. By
increasing the number of weavers through training more SACDEC members to weave, they can
increase the number of production at the same time the profit of the organization.
When the business’ profit can sustain the needed expenses of the cooperative, it is
during this time that they will incur additional investment for machineries and equipments which
they can use in the faster production of their product such as drying and cutting equipments.
Also, in the future, it is expected that they can have their own manufacturing factory wherein
they can make products in bulk. Though machines are already present, it is still advisable that
they employ quality control personnel to see to it that the quality of the products made passes
Marketing
They expect to have more retailing outlets wherein they can display their products for the
costumers to see. Since they are presently engaging in direct marketing, it is best that they
continue establish this connection with them and retained their loyal customers.
Someday, they hope in engaging into product exportation when they have constant
production and enough raw materials and equipments to make the product.
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
SYSTEM DOCUMENTATION
Products Manufactured
SACDEC is an outlet of our indigenous brothers and sisters to showcase their talents and
skills in handiworks and weaving. Even before SACDEC has been fully established, the
Liningwan Ati Community in Sibunag has already started weaving as part of their hobby and
recreation which is a good way of socializing among the members of the community and in
It also serves as their primary source of income by creating native products through the
use of available materials like buri and nito. During their free time they spend their time weaving
some products which they can think of like wallet, coin purse and bags. Even though they are
not in the production site, they are still able to do their respective weaving responsibilities since
their product is human labor dependent and does not depend on any machines and equipment.
SACDEC produces high quality buri, nito, pandan and abaca products promoting Sibunag
Ita’s cultural heritage and handicraft traditions. Not only this, the products are durable and earth-
friendly since it does not contain any harmful chemicals that can destroy the environment. Aside
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Figure 1
Major Products
Bags
They are making bags such as shoulder bag, lady’s back pack and the like. Native bags
are already known not only locally but also in the other parts of the world. Even some of the
famous foreign celebrities are using native bags in their films and movies. And the products of
SACDEC have the ability to compete with those branded products. They have several colors of
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
The wallets that they are making are good not only for females but also for males
(unisex). These said wallets can also hold ID’s, cards (ATM, privilege and others), and even
The coin purse also varies in sizes and colors. It depends on the customer’s preferences
Other Products
Other handicrafts that they produce are placemats, hats, cellular phone holders, wine
holders, and bags that can hold big sizes materials. They also produce traveling bags which are
Bags 300.00
180.00
Wallet 130.00
100.00
50.00
Placemat 45.00
30.00
Hat 150.00
Table 1
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Guimaras Map
Figure 2
Panay Map
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Guimaras is an island province of the Philippines located in the Western Visayas region.
Among the smallest provinces, its capital is Jordan. The island is located in the Panay Gulf,
between the islands of Panay and Negros. To the northwest is the province of Iloilo and to the
southeast is Negros Occidental. Guimaras was a sub-province of Iloilo until it was made an
Guimaras Island
Figure 3
Guimaras Map
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Sibunag and San Lorenzo. SACDEC (Sibunag Ati Community Development Cooperative) is
SACDEC was established at Maabay Sibunag Guimaras. Sibunag was created by virtue
of RA 7896, one of the two youngest municipalities in the Province of Guimaras established in
1995. Sibunag was named after its main river; abound with spellbinding folk tales and legends.
Legend also says that Sibunag, son of deity & mortal was stolen when only a baby. He was
cared for and raised by a fairy. His numerous and amazing adventures and romance found
niche within the hearts of the folklore waters. The Municipality of Sibunag is situated southeast
http://guimaras.gov.ph/homepage/sibunag/
Figure 4
Sibunag Map
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
There are two (2) headquarters or production site of SACDEC. One is located in
Liningwan Maabay Sibunag Guimaras near the public market of Sibunag and the other is at the
Chavez compound.
Public Market
SACDEC Headquarter
Cell
Site
Chavez Compound
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Raw materials like buri, nito and pandan used in the making of the final product is
available for purchase in the neighboring towns of Guimaras. Since most of these
aforementioned materials are growing in the wild, SACDEC has the initiative to just pluck them
in places available to save cost. Otherwise they have to purchase them from places where this
are available.
In the case of abaca, the TSKI has to buy them in Janiuay Iloilo and transport them in
Guimaras to SACDEC where they have to repurchase the material and use them for weaving.
Other important materials include thread, clothe, dye and water. Thread, clothe and dye
are often purchase in Guimaras itself and since the water used has no specifications, tap water
The distribution center of Guimaras is at Trappist, Guimaras. They also distribute their
products in nearby towns. Trappist Monastery is located at San Miguel, Jordan Guimaras. Its
gifts shops and stores are located within compound of the monastery. It sells monastic
processed products like mango jams, dried mango, guava jelly, kamyas prune, ginger tea,
homemade cookies, religious souvenir items, products made of coconut shells and other things
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
In cases wherein there are made to order products or special orders, the
cases, the arrangement with regards to the transportation of the product would
place.
Through TSKI
There are also cases wherein TSKI (Taytay sa Kauswagan) would accept
orders directly from customers and forward the request to SACDEC for the
making of the product. In this event, SACDEC will deliver the products to TSKI
Trappist
Trappist is the retail outlet for SACDEC’s products. In this case, delivery
But in the case of abaca which is located at Janiuay Iloilo, TSKI buys the product
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
and the only transportation cost that SACDEC has to incur is the cost from
Production Process
SACDEC uses a combination of batch processing and Just in time system in the
production of their products. Batch processing system means producing large quantity of
products during the production process. It is visibly evident during the peak season for
SACDEC’s products. Since they knew that during summer there are many tourist and
customers, they see to it that months before April and May they have produce a number of
wallets, pouch and bags during the months of January, February and March. They make a
schedule of output that they have to finish for a certain period of time. For the months of
January they have already started making wallets and by the months of February and March
other native products are weaved until they reach the number of target output.
But most of the time, they use Just-in time system due to the lack in their financial
aspect, they make the products as they are demanded by the target market. These are in cases
when special orders are place by some clients. As walk-in customers demand the production of
certain products for that period, they would shift their attention in the making of that product.
One good example is the travelling bag that was ordered last July 2009. A customer from
Manila ordered 50 pieces of travelling bag from the weavers and since there are only six
weavers and they have few time to make the output, they all shift their attention and focus their
attention in producing travelling bags. At most cases, the weavers prefer this kind of scenario
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
because it gives them the assurance that their woven products are sold and that they can earn
profit immediately.
Adding vinegar
and papaya for
Exposing the
bleaching
material under the Washing the
heat of the sun for 1 material with
day water
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Most of the raw materials that are being utilized in the making of several products were
mainly from the Guimaras province. Guimaras being endowed with fertilize and healthy soil is
good for plants to live. It has a tropical climate with dry seasons that made it easier for plants to
grow.
It helps its people to have some of its needed materials in producing their goods and
products. Buri, pandan and nito are some of the naturally given gifts of the land to its people.
Since SACDEC’s products are mainly dependent on these materials, these provides easy
Abaca however is bought in the town of Janiuay Iloilo. TSKI (Taytay sa Kauswagan Inc.) a
micro financed community development institution helps SACDEC obtain these materials
through some of their employees. Ms. Chlowe Inagan, a TSKI representative assigned to assist
SACDEC starting July 4, 2009 is the person responsible to buy the abaca from Iloilo and
Table 2
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
There are no specific suppliers or sellers of the raw materials because just like buri and
pandan they may get it in the wild of Sibunag and also they purchased some of the raw
materials to the “private growers” or private people who planted the said plants and sell it. And
sometimes they buy it in their local market. But the abaca, the TSKI buy it in Janiuay, Iloilo and
bring it to them.
The number/volume required of materials that are being utilized depends on the product
(its size and style). And the following table tells the number of days that will take in making the
products.
1. Wallet 2
2. Envelope 2
3. Bags 2.5
4. Coin purse 2
5. Belts 2
7. Placemat 2
8. Wine bag 2
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
SACDEC sees to it that when it is near peak season, they have already prepared a
number of products that they are going to sell. They have target output even before they started
making the products. Inventories are kept in the headquarters. But most of the time, SACDEC
uses Just-In-Time method in the making of their product. When the orders come, they have to
finish it as soon as the raw material is ready and dry. They do not have to worry of their
inventories (like controlling it) because the number that they will made is slightly the same with
the number that a customer orders. They maintain one product in their store to be a sample
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Utilities
The utilities that SACDEC mostly utilized are oil, water, gas, a small amount of vinegar
and light.
metals.
materials.
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
SACDEC produces bags, mats, wallets manually or through their bare hands. Sewing
machine is the only equipment that they have and they use it for placing zippers and stitches.
They do not have these hi-tech, big and heavy machines / equipments. With the skills of their
hands, they produce good quality products that they can be proud of.
They also have these boxes of different sizes (made of wood) serve as the frame or the
The other things that they use are cutters, scissors, thread, needles.
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
the product.
and weaving.
of the rust to the metals of the sewing machine and the cutter.
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Worker-Machine Chart/Assignment
In using the sewing machine, the only equipment, there is no problem with regards to it
because there are only few who knows how to use it so in assigning the machine to the worker
is not so difficult.
Production Capacity
SACDEC produces made to order products such as bags, pouch, wallets and etc.
However, on these products lines only the wallets has the stable demand every month and
making it their regular production output. SACDEC delivers 5 pairs of wallet to Trappist twice a
month and the remaining output would then be disposed on individual orders. Due to these
concerns, the group decided to measure output on the basis of the number of wallets produced
per month.
o Design Capacity
If there are 6 operating days in a week (26 days in a month) with 4 hour
shift per day, each laborer will be expected to finish 4 wallets per day.
Design Capacity:
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
o Effective Capacity
between his/ her shift. That would make the output down to 3 wallets per day.
Effective capacity:
However, in the actual shifts laborers can only make 2 wallets every 2
days.
Currently SACDEC is composed of six member weavers that are entitled to work on any
time that is convenient to them. Since these members are mostly “mothers” they could only
allocate 4-6 hours a day, 6 days a week for weaving on normal demand. Mothers often weave
from 1 pm to 5 pm when their children are at school and after dinner just before they go to
sleep.
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Weavers produce .5(1/2) wallets per day. Below is SACDEC’s production schedule.
Fridays is market day, considered their time to purchase and process the materials.
Hour
Weaver 1 2 3 4 5
Table 6
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Hour
Weaver 1 2 3 4 5
Table 7
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Efficiency Measures
Capacity Utilization
As the result of the capacity utilization equation above shows, only 13% of the design
capacity was utilized. The low utilization level that they have in their operations is a result of the
unfixed time scheduling for members and undefined target production level per shift. Recall that
on the above article, actual output is only .5 (1/2) wallet per day instead of 4 wallets per day
design capacity.
9” * 8” wallets are made of buri, nito and outlined by cloth. For making 6 wallets
for 2 weeks, the first thing a weaver does is to first process 2 buri leaf packs. As shown
in the diagram 2 on the following page, the buri is first stripped from its leaf pack and
then boiled into a big pot. Stripping the leaves often last for about 20 minutes while
boiling ranges from 10 to 20 minutes. Then a bottle vinegar and papaya leaves are
applied while boiling to bleach the buri. Remove from fire and rinse with cool water then
expose it under heat of the sun for a day. Then soak on a basin of water for one night.
The next day, rinse it till all its liquids are gone, and then dry. After it has been
thoroughly dried, separate the leaves, straighten then strip. This step takes about 30 to
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
45 minutes. The next process would be boiling the buri with dye for about 5 minutes and
then dry. It would then be ready for weaving. Next, weave the buri and nito. Cut the
Weave
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
The current 6 weavers of SACDEC are considered experts of the craft. Due to
this, reject probabilities are very slim from 1 to 2 rejects a month or at zero level. On the
wastage level. Example in single buri pack only three 9” * 8” wallets could be made. And
The materials are therefore not efficiently used in the case of nito since there is
Waste Disposal
The raw materials that are being utilized by the Sibunag Ati Community Development
Cooperative (SACDEC) in the making of their products are identified as biodegradable. Waste
or unusable materials like excess buri, nito, pandan and abaca are either thrown in compost
bins to serve as fertilizers or use as wood-alternative which they use in cooking their food.
Other materials like dye wrappers and the like are thrown in trash cans classified as non-
biodegradable. Also, the used water use to clean and dye the raw materials is use in watering
the plants.
Proper consideration with regards to the environment has been properly considered by
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
In cases wherein the product has slight defects and does not pass quality control,
SACDEC chooses not to sell their products rather buys it at the amount enough to compensate
Disposal System
The excess materials used in the making of the native products made of buri, nito,
pandan and abaca are either thrown in compost bins and use fertilizers or wood-alternative.
Finished Product
Excess Materials
Used
Fertilizer
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Production Cost
Operating Cost
SACDEC rents two stalls on their municipal markets. No transportation costs are
incurred for transferring products to these stalls since the houses of the members are near the
market. For made to order products, freight cost are paid by the clients. SACDEC currently
owns 4 sewing machines used for lining cloth to the wallet. This 2 are granted by Taytay sa
Kauswagan (TSKI) and the other 2 are from DOLE. SACDEC does not have fixed salaries for
the members. When sales are collected 95% of it is divided to the members and 5% of it is left
for the cooperative account. Hence, SACDEC’s monthly operating costs are as follows:
Electricity: P10
Machine maintenance: P 50
o Total Cost
TC = FC + v * Q
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Cost Schedule
Variable Cost
Direct labor per wallet P0
Direct materials
Buri (P10/3 wallets/leaf pack) P 3.33
Nito (45 pcs. * P.75) 33.75
Cloth ( P25 / 14 wallets/cloth) 1.79
Zipper(P 200/100 m / 1 meter/ 4wallets) .50
39.37
Indirect Materials:
Thread (P 65 / 150 wallets) P 0.43
Dye ( 2 leaf pack * P2) 4
Vinegar ( 2 leaf packs * P 10 / bottle) 10
Papaya Leaves 0___
14.43
Variable cost per wallet P 53.80
Fixed cost
Selling Expenses
Rent P240
Electricity 100
P340
Administrative
Maintenance (P150 for 3 months) 50
Total fixed cost P390
= P4586.40
o Percentage Cost
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
52 % of the total cost comes from variable cost. 63 % of the variable cost comes from
purchase of nito. To reduce variable cost the first thing that needs to be corrected is to increase
the efficiency of nito usage. Since in every 9” * 8” wallet, 45 nito stems are utilized.
Contribution Margin
= P390/76.20
= 5 units
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Advantages Disadvantages
Weavers To increase the • Train additional • Rest assured that • Training additional Train
number of trained weavers when they are well- weavers would mean additional
weavers so that they trained, the profit is additional expenses weavers to that
are assured that they for SACDEC alone. for training. they can help
can meet product to the people
demands • They have to around them.
continuously motivate
the trainees.
• Outsource from • They could help other • Each member would
other Ati Ati community gain receive less than the
community profit and have their usual.
livelihood.
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Advantages Disadvantages
Financial/Capital To have additional • Obtain Loan from • More capital will be • They need to comply Knowing that
sources of financial other financial used by the and undergo a long SACDEC
support. institutions. cooperative to process for the produces
generate raw approval of the loan. products that
materials that they are really
need. good, there is
a good
• The cooperative will probability that
have a chance to their loan from
promote their products other
with other institutions. institutions will
be approved.
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Advantages Disadvantages
Equipment To have equipments • Invest in • They can produce • There is a need to Since they
that could help hasten equipments that more products that educate the members don’t have
the production could help improve could comply with the who don’t know how to ample money
process. the production demands of the use the equipment. for the
purchase of
through long-term customers and have
loan more profits. good
equipments, it
• Since it would take could be
one year for the helpful that
company to pay its they obtain
debt then they need these
not have to worry equipments
paying every month. through long-
term loan.
• Obtain equipments • They can obtain the • The cooperative needs
through short-term equipments they to pay for the interest
debt. need outright. of the equipment.
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Advantages Disadvantages
Laws and To comply with the • Cooperate with • They can transact • The possibility that Though it
Regulations Laws impose by the other small scale together and possibly business’ secrecy will would entail
Philippine government business ask for discounts in not be realized. additional cost
to small scale enterprises so that their permits. for SACDEC,
business enterprises. they will have an they should
idea of the cost of • They can build a operate legally
every transaction strong bond within and register
and permit. the industry. their business.
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Advantages Disadvantages
Hours shift To have uniform and • Build/rent a place • When all workers • Fixed cost will be
fixed shifting hours for production. weave in one place increased.
their focus and
productivity can be
increased.
• Retain the old set • Lower fixed cost. • Shifting hours can’t be Since SACDEC
up and weave at regulated. recently has a
home. little financial
• Numerous distractions shortage, it
at home. would be
better to retain
the old set up
for now. But in
the long run, it
is advisable
that they
should have a
more
systematic and
impose
working hours.
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Advantages Disadvantages
Marketing Increase sales • Assign a • Since there would be • Increased
member(s) that someone to administrative cost for
would be in concentrate on this two marketing
charged in looking marketing. Probability officers.
and negotiating for of higher sales would
potential stores that be bigger.
might sell the
product of
SACDEC.
• Connect with other • Since these • Incur commission Connect with
organizations aside organizations were cost. other
from TSKI which already established organizations
can act as a they already have would be
wholesaler or wide connections preferable.
accept an order which can be good Since cost
and pass it to for SACDEC. would be lower
SACDEC. because these
organizations
would only
charge
SACDEC every
time there is
sale.
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Advantages Disadvantages
Daily Production To increase daily • Designate • Production rate will • Probability of Since SACDEC
production rate production quota to be increased. production surplus does not pay
each weavers. would also be by hour, it
increased. would be wiser
to designate
quota per day
instead of
stretching their
daily shift.
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Advantages Disadvantages
Purchasing Minimize purchasing • Assign only one • Purchasing materials • Sales distribution It would be
cost member to on wholesale offers would be altered. Part more
purchase materials more purchasing of the sales would be systematic if
on wholesale and discounts. Thus, allocated for SACDEC would
later distribute it to reducing purchasing purchasing. Hence, just assign a
the members. cost. losses would be more purchasing
absorbed by the officer. This
eliminates
• Purchasing cost will cooperative.
hassles on
not be shouldered by accounting and
the weavers. costing. It
would also be
easier to track
the
cooperatives
financial status.
And lastly,
operations
would be more
stable since
there would be
an assurance
that there will
be enough
money for the
cooperative.
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Advantages Disadvantages
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Appendices
Products
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Documentation
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
Proposed Brochure
Mgt 139 Class of Professor Aileen Dela Cruz
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SACDEC
Sibunag Ati Development Cooperative
Liningwan Maabay Guimaras
References
Interview
Book
Internet Sources
http://www.wikipedia.com
http://guimaras.gov.ph/homepage/sibunag/
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