Bicolano magic in a can - Planters Development Bank

A Plantersbank publication
sme
.COMmunity .PHilippines
v 0 l 3 i s s u e 5 2 0 0 8
MOONDISH
Bicolano
magic
in a can
JUN AND ANNA MANRIQUE BRING
OVERSEAS FILIPINOS CLOSER TO HOME
• KEMWERKE:
Where chemistry works wonders
• Strategic planning for tough times
• Hiring tactics for SMEs

sun
cellular

FROM THE PUBLISHER’S DESK /
STAFFBOX
SME PRODUCTS
FOR THE WORLD
FLYING OVER our islands, from Luzon to the Visayas, down to Mindanao, our
natural resources can be clearly seen – the blue vastness of our seas and
the lush verdure of our plains and mountains, coconut trees making up the
most visible foliage. The coconut palm, Cocos nucifera, is one of the most useful
blessings bestowed on the Filipino people, and it has generated many a job for
locals, especially in the rural areas.
This SME.Community.Philippines issue takes a look at two SME companies
which have made a business of selling coconut-based products in the export
market. Our cover story features Moondish Foods Corporation, which manufactures
and sells canned laing, taro and coconut based product, to overseas Filipinos.
Kemwerke, Inc. supplies coconut alkyd and polyol resins to Netherlands-based
AkzoNobel, the largest global paints and coatings company. Moondish owners Jun
and Ana Manrique and Kemwerke founder Luis G. Fernando share with readers
the secrets to their companies’ successes.
New York based sales training professional Adrian Miller enlightens us on the
value of professional customer service, and she proceeds to tell us about turning
a one-time customer into a long-term client. Marketing expert Herbert Sancianco
exhorts us to ‘Be prepared!’ with strategic business planning, especially in these
times of financial uncertainty. Franchising guru Armando Bartolome paints us
a rosy picture of the future of franchise businesses, which expects another
tremendous growth spurt this year. Romanian entrepreneur Cristian Dorobantescu
writes about how SMEs can hire good, quality people for their companies.
Technology writer Edong Mendoza briefs us about the benefits of a good
timekeeping system for business. The section on entrepreneur tips gives us a
very useful list of environmentally-friendly things to do, plus some tips on how
to get an appointment, especially useful for doing cold calls. Our book review
section features an overview of Josiah Go’s ‘Fundamentals of Marketing in the
Philippine Setting.’
As we move towards the last months of the year, the inspiring stories and
useful information in the magazine are our way of thanking you for being our
partners in supporting SMEs. We hope that you will enjoy reading this issue and
may it give you a fresh perspective in doing business.
1
VOL. NO. 03 / ISSUE NO. 05

FEATURES
CONTENTS
COV ER
S TORY 8MOONDISH:
CANNED LAING FOR THE WORLD
D E PARTMENTS
4
16
12
23
HOTLINE
ENTREP RENEUR TIP S
EASY THINGS YOU CAN
DO FOR A HEALTHY PLANET
SME FOCUS
KEMWERKE, INC:
FINDING THE RIGHT MIX
OF BUSINESS AND CHEMISTRY
TECHNOLOGY
TIME CHECK TECH
24
BOOK REVIEW
JOSIAH GO: FUNDAMENTALS
OF MARKETING IN THE
PHILIPPINE SETTING
COLUMNS
6
FRA NCHISING
FRANCHISING FIRMS DOING BRISK BUSINESS
15
GLOBA L VIEW
10 HINTS TO ‘CATCH’ THE RIGHT EMPLOYEES
by Cristian Dorobantescu
17
S A LES TRA INING
A PRIMER ON PROVIDING
PROFESSIONAL CUSTOMER SERVICE
by Adrian Miller
Biometric
Timekeeping
SME FOCUS
KEMWERKE, INC:
FINDING THE RIGHT MIX
OF BUSINESS AND CHEMISTRY
18
20
M A RKETING
STRATEGIC PLANNING
FOR BUSINESS SURVIVAL
by Herbert Sancianco
MONEY M A TTERS
MAKING SENSE OF THE U.S. FINANCIAL CRISIS
by Francisco Colayco
3VOL. NO. 03 / ISSUE NO. 05

HOTLINE
Plantersbank
bags top SME
finance awards
Plantersbank, the country’s lead bank
for small and medium enterprises
(SMEs) added two more trophies to
its roster of honors during separate
ceremonies recognizing the country’s
top development finance partners.
Plantersbank was named the Best
Countryside Loan Fund Partner and
Balikat ng Bayan Best Participating
Financial Institution by the state-run
Land Bank of the Philippines and Social
Security System (SSS), respectively.
The Land Bank and the SSS cited
Plantersbank for significant contribution
in volume and loan quality to SMEs
under the wholesale financing programs
managed by both institutions.
Plantersbank is stepping up its
lending to the SME sector, especially
in the countryside where it hopes such
Outstanding SME bank, partner in countryside development. Plantersbank president Maria Flordelis F. Aguenza
(right) receives Best Countryside Loan Fund Partner award from Land Bank chairman Gary Teves and World Bank
country director Bert Hoffman during the 2008 Countryside Loan Fund Awarding Ceremony in Manila.
efforts will stimulate more economic
activity and improve incomes.
Plantersbank also received this year’s
Kabalikat ng Micro and SMEs during the
2008 SBCorp Bank Excellence Awards
for outstanding contribution under the
financing and guarantee programs of
the Small Business Corporation, the
government agency for promoting SME
development.
Antipolo Branch unveils new office
4
SME.COMmunity.PHilippines
Plantersbank unveiled its new Antipolo
Branch at a new and spacious location in
the heart of Antipolo City.
The branch is now located at EMS
Building on the corner of M.L. Quezon
and Dimailig Streets, a short walk from
its original site and the Shrine of Our
Lady of Good Voyage.
The new Antipolo Branch office
sports the trademark green, red and white
corporate livery using cutting-edge, low
energy LED technology for illumination in
place of regular lamps. The branch sign
represents Plantersbank’s commitment
to energy-saving alternatives and
minimizing its carbon footprint.
Branch manager Maria Cecilia C.
Oxales said Plantersbank Antipolo is
honored to serve the rapidly growing
Small and Medium Enterprise (SME)
Entrepreneurs Jovito Gatlabayan (left) and
Felicidad Contrevida cut the ceremonial ribbon
at the official opening of the new Plantersbank
Antipolo Branch office. With them are
Plantersbank president Maria Flordelis F.
Aguenza (second from left) and Antipolo Branch
manager Maria Cecilia C. Oxales.
community of the city. In line with its
mission, Plantersbank provides a wide
range of financial products, loans,
management solutions and business
services to boost SME productivity and
competitiveness.

SME Speaker Series
South Luzon leg draws
huge turnout
Renowned business guru and life coach Francis J. Kong received
a rousing welcome from entrepreneurs during his visit
to Calamba City in Laguna, courtesy of the Plantersbank SME
Speakers Series on October 15.
Mr. Kong was invited to lecture on the theme “Leading
through Difficult Times” to 200 guests at the “by-invitation
only” event held in RSM Seafood Garden. Organizers said the
huge turn-out in Calamba is a repeat of earlier Plantersbank
engagements in Cebu City, Metro Manila and Pampanga that
also featured Mr. Kong.
Plantersbank chairman Ambassador Jesus P. Tambunting
said the SME Speakers Series “aims to inform and enrich the
perspective of Filipino entrepreneurs who are trying to make
sense of the rapidly shifting and, at times, uncertain business
environment.”
Ambassador Tambunting added that the Series hopes
“to promote ideas and practices for achieving better levels of
productivity, profitability and competitiveness within the SME
Community.”
The SME Speakers Series is being presented in partnership
with Globe Business. Mr. Kong is scheduled to lecture in
Davao City in early November.
Life coach Francis J. Kong has been touring the country’s SME lecture circuit
with Plantersbank to inspire entrepreneurs and fortify them for sharp shifts in
the economic landscape.
Photo shows part of the huge turnout in Calamba. Many participants
traveled from all over Calabarzon region to attend the much-awaited,
by-invitation event.
Bulacan salutes
Plantersbank pro-SME role
Members of the Bulacan business
community, government officials and
SME advocates saluted Plantersbank’s
role in promoting development in this
province during the recent GoNegosyo
roadshow in Malolos City.
The Bulacan Chamber of Commerce
and Industry and GoNegosyo Caravan
organizers named Plantersbank among
Bulacan’s most inspiring homegrown
companies, citing its contribution to the
emergence of a thriving SME community
in the province.
Plantersbank traces its roots to
Bulacan where, 36 years ago, the bank
started lending to small farmers and
home-based businesses.
5
VOL. NO. 03 / ISSUE NO. 05

FRANCHISING FIRMS
DOING BRISK BUSINESS
6
SME.COMmunity.PHilippines
Not content with making
more money this year than
last year, the association of
local franchisors is working
to further continue growing its members’
sales next year by encouraging them to
open more stores or branches. Last year,
their store revenues already grew by 29
percent to P13.8 billion from P10.7 billion
in 2006. This translates to a daily sale of
about P37.8 million.
In a recent press briefing, the
Association of Filipino Franchisers, Inc.
(AFFI) said the group would target a
revenue growth of another 25 percent
to 30 percent for this year.
This would be achieved “by
encouraging more [AFFI] members to
open more stores and more branches,”
said Armando O. Bartolome, AFFI
member and president of consulting
firm GMB Franchise Developers.
AFFI’s 80 members also sustained
24,039 jobs last year, in a total of 4,046
branches nationwide. About 1,416
or 35 percent of these branches are
company-owned while 2,630 or 65
percent are entirely franchised.
“Each AFFI member company has
been in the business for an average
of 15 years. They have achieved a
‘high’ 98.6 percent rate of success or
profitability,” Bartolome also said.
AFFI president Rommel Juan
of Binalot Fiesta Foods noted the
advantage of buying a local franchise,
instead of a foreign one. “When you’re
a foreign franchisor, you’re watching
two things: your business cycle and
the currency exchange. With a local
franchise, you concentrate on your core
business,” Juan said.
Richard Sanz, AFFI public relations
officer, pointed out that “franchising
is one way of cutting short the
entrepreneurial process since investors
would buy an established business.”
He said franchising would also
help the government’s micro, small and
medium enterprises (MSME) agenda,
which would solve unemployment by
encouraging over 800,000 MSMEs
nationwide to hire two additional
workers every year.
This program will almost cover the estimated
1.8 million new workers that enter
the labor force every year, Sanz said.
At the forefront of the financial
support for the SMEs is Small Business
Corporation, formerly the Small Business
Guarantee and Finance Corporation
(SBCorp). It has three SME “target
sectors”: pre-bankable firms, or startups
who cannot get a loan from banks;
near-bankable firms or those who can
obtain a bank loan but will have to shell
collateral; and bankable firms who are
seen as having no problems securing
credit.
“SBCorp provides direct lending to
pre-bankable firms and credit guarantee
covers for near-bankable firms. For
bankable firms, we provide funding to
banks to reduce the rates of mediumto-long-term
financing. We have also
recently introduced risk-based lending
as a product offering,” says SBCorp
chairman Virgilio R. Angelo.
“As a matter of fact, we have lent a
total of P13.7 Billion to some 7,082 SME
borrowers since 2004. We aim to help
the 743,628 micro, 60,785 small and
2,922 medium entrepreneurs in our
country today. They are the backbone
of our economy as they employ about
69.9 percent of the country’s labor
force,” Angelo adds.
In most cases, franchisers agree
to give up to a 50 percent corporate
guarantee to franchise buyers, he said.
SBCorp however requires franchisers to
have an operating manual, three years
of franchise experiences and three
profitable franchises.
“As a safeguard, we do not
encourage people to do business with
new franchises that do not have an
established track record yet,” Angelo
concluded.

FRANCHISING
U.S. “Entrepreneurship” program
hosts Filipino SME advocates
The US Department of State recently
hosted five women entrepreneurs
from the Philippines for a three-week
visit with North American counterparts
under the International Visitor
Leadership Program.
The exchange program on the
theme “Women and Entrepreneurship”
brought the delegation to various cities
in the United States for meetings with
Chambers of Commerce, the Small
Business Administration, women’s
organizations and entrepreneurship
schools. The delegation represented
the Philippines’ major island groups and
various women and trade organizations.
Plantersbank chairman and chief executive
officer Ambassador Jesus P. Tambunting
lauded the Association of Filipino
Franchisers, Inc. (AFFI) for taking the
lead in professionalizing local franchise
practice in his key note at the opening of
the three-day 7th Filipino Franchise Show
at the World Trade Center in Pasay City
held recently . Ambassador Tambunting
L-R: Gianida Lumanggal of North Cotabato, Chit
Juan of Manila, Rima Hassan of Basilan, Dina
Rodriguez from Manila and Rose Nepomuceno of
Aklan.
Economic contribution of franchising lauded
added that Plantersbank is taking new
initiatives to boost the performance of
the country’s SME sector.
Shown giving a thumbs-up to SME
driven opportunities at the Franchise
Show opening are Ambassador Jesus
P. Tambunting (fourth from left), with
(from left) AFFI board member Estrelita
Montanido of Chicharific, AFFI chairman
emeritus Teresita L. Ngan
Tian of Lots’ A Pizza, entrepreneur
Mark Villar,
Ms. Earth-Philippines
2008 Cathy Untalan,
AFFI president Rommel
T. Juan of Binalot Fiesta
Foods, Trade and Industry
Undersecretary Merly
Cruz and AFFI vice president
Kamela C. Seen of
Plato Wraps.
Franchising guru
unveils ‘Overview’
According to the local franchise group
Association of Filipino Franchisers Inc.,
franchise business models have a nine-in-
10 chance of success compared to start-up
businesses which have an 85 percent failure
rate.
With more Filipinos looking to entrepreneurship
as an alternative to corporate
careers or work overseas, the publication
of “Overview of Franchising” by Philippine
franchising guru Armando ‘Butz’
Bartolome is a welcome contribution to the
limited literature available about the homegrown
franchising scene.
Based on internationally accepted
principles of the industry and drawn from
Mr. Bartolome’s 30-year track record in this
field, this is a book that will interest franchise
owners, budding entrepreneurs, investors
and business students alike.
By veering from one-sided presentations
on the topic, the volume allows the
reader to develop a better appreciation of
the business from the perspective of franchisors
and franchisees.
“Overview of Franchising”, which
comes with a free copy of Franchise Listings
DVD, is the newest addition to the author’s
advocacy of responsible franchising as a
sustainable route to growth and success.
“I am hopeful that this book will allow
people to derive immeasurable benefits
from franchising,” Bartolome said recently.
“These advantages are realities worldwide
and they are there for the taking.”
7
VOL. NO. 03 / ISSUE NO. 05

COVER STORY
8
SME.COMmunity.PHilippines
Ana and Jun Manrique

Moondish:
CANNED LAING
for the WORLD
BY TICHOT SAN PABLO AND NED LIUAG
More than one in ten Filipinos
live and work outside the
Philippines; as of last count,
it was estimated that there
are over 9 million Filipinos overseas.
These are our modern heroes, representing
a huge slice of the population, and
bringing home an even bigger chunk of
the country’s financial earnings.
What do all overseas Filipinos have in
common? For sure, they are all homesick.
They miss their families, their hometowns,
their friends, the Filipino way of
life, and of course, Filipino food!
For Rufino ‘Jun’ Manrique and wife
Ana, the way to keeping the islands close
to many a nostalgic Filipino’s heart is a
can of laing with the Moondish brand.
Jun and Ana are pioneers in the
production of canned laing—taro (gabi)
leaves and stalks cooked in coconut
cream, seasoned with ginger, chili
and other spices—and their company
Moondish, Inc. has been supplying
Filipinos overseas with the traditional
dish for almost a decade.
Bicolano Magic in a Can
To the imaginative consumer, the magical
flavor of the Moondish brand is believed
to derive from the marriage of moonlit
volcanic soil and the rains of the Pacific
monsoon that sweeps across the Bicol region.
It is there that Ana traces her roots
and where the choice ingredients that go
into every Moondish can—the coconut
and taro—are grown and harvested by
hard-working villagers.
Like many idealistic members of their
generation, Jun and Ana spent 10 years
doing their share to accelerate change as
community organizers among the rural
poor. As their family responsibilities
increased, the couple realized that they
could still make a difference in society
through the medium of entrepreneurship.
Working from home in Moonwalk
Village in Las Piñas, the couple’s
first venture was called Moonbake
Breadhouse. With their background in
commercial bakery management, the
couple did brisk business supplying
chocolate crinkles and baked goodies to
schools and stores around Metro Manila
and in nearby provinces.
But its success was cut short by
the Asian financial crunch of 1997.
Skyrocketing flour and sugar prices
prompted Jun and Ana to scout for more
profitable alternatives. For a time, the
business shifted to banana chip and
buko pandan production, but that pursuit
proved neither exciting nor satisfying for
the couple.
In their search for a new product, Jun
and Ana chanced upon an innovative
idea at the Food and Nutrition Research
Institute in Taguig, where more than
90 food technologies are lined up for
the commercial mainstream. “New
technology and product ideas exist out
there waiting for the entrepreneur to put
THE MANRIQUE’S REALIZED THEY COULD
MAKE A DIFFERENCE IN SOCIETY THROUGH
THE MEDIUM OF ENTREPRENEURSHIP.
9
VOL. NO. 03 / ISSUE NO. 05

Jun and Ana Manrique with their eldest child, Julia.
them to use,” Jun explains. “Fortunately,
Ana and I were in the right place at the
right time.”
So, in 1999, Jun and Ana put up
Moondish Foods Corporation, an experimental
venture with equipment leased
from the Department of Science and
Technology (DOST) through its “technology
business incubation” arrangement.
A few months after the experimental
plant started operations, Jun and Ana put
the new product on display at the Asian
Ethnic Food Festival where its close-tohome
cooked goodness instantly caught
the interest of the market.
By the time the company participated
in the National Food Trade Fair in 2000,
Moondish laing had already found its
way into supermarket shelves and the
first orders started coming in from buyers
abroad.
“Lakasan lang ng loob,” says Jun, of
the daring decision to accept the first
bulk order for canned laing. This proved
to be the necessary push that set their
company on the road to further growth.
with the state-owned Philippine Export
Import Credit Agency enabled business
to take its tentative step in the export
market.
In 2001, with the rise in demand,
Moondish sought out Plantersbank to
provide the custom-fit financing for the
expansion of their canning operations.
From the initial output of a few dozen cans
a day, the company now offers variants of
canned laing, along with products such
as Bicol Express (an exotic mixture of
chili, bits of meat and spices simmered
in coconut cream), pinakbet, puso ng
saging (banana blossom), and other tasty
vegetable dishes.
“We believe in taking calculated
business risks and practicing handson
management,” says Ana, who is
responsible for the company’s day-to-day
operations. “If you want to succeed in
business, you can’t afford to stop learning
and innovating.”
Today, seven in 10 Moondish cans
produced at the Taguig plant find their
way onto shelves serving the Filipino
diaspora in Canada, United States,
Western Europe, Middle East, Guam and
Japan.
The Manriques say the challenge
is to expand the market outside the
Filipino diaspora. Meantime, the more
adventurous European food-lovers are
slowly developing a taste for the coconut
cream-based vegetable dish.
The Manriques are especially proud
that the Moondish brand is synonymous
with a convenient, all natural, high fiber
food product that contains no artificial
preservatives and has a guaranteed long
10
SME.COMmunity.PHilippines
For the Global Filipino
Supported by the DOST-affiliated
Technology Applications and Promotions
Institute, the Manriques set about
building their 1,000-square meter production
facility in the sprawling FTI complex
in Taguig City. A credit line negotiated

shelf life. Moondish passes the rigorous
standards of the United States Food and
Drug Administration (USFDA) and is also
certified ‘halal’ by the Islamic Dawah
Council of the Philippines consistent with
the Muslim dietary regulations.
As a company with a social conscience,
Moondish takes pride in generating
export revenues for the economy and
jobs in local industry, as well as helping
to spark economic activity in the
countryside through the steady demand
for raw materials for Moondish laing and
other canned traditional delights.
Moondish Foods Corporation
71-B KKK Bonded Warehouse
DBP Avenue, FTI Complex
1630 Taguig City, Philippines
Contact No: (632) 839 2057
Fax No: (632) 839 2057
Email: moondishfoodsproducts@yahoo.com
Website: www.moondishfoods.com
Out
of the
C an:
MISSION
We are dedicated to satisfy our customers by
producing quality Filipino foods environmentalfriendly
technologies.
We are committed to be socially responsible
for providing employment and livelihood
opportunities to people to help alleviate poverty.
We endeavor to bring out healthy food products
made of natural ingredients taken from indigenous
crops.
We adhere to the principles of fair trade and equal
opportunity for all gender in the workplace.
VISION
Moondish Foods Corporation envisions to create
value to vegetable dishes and other indigenous
products for local market, and create a niche in
the international scene by bridging our Filipino
exotic blend to Asia and the rest of the world based
on convenience, wellness and affordability, which
only Moondish product can offer.
Find your niche. Create value for customers with
unique products.
Keep your focus. Know your trade.
Be prepared to take calculated business risks.
Pursue excellence. Invest in quality.
Practice hands-on management.
Develop your eye for detail and master every facet
of the business.
Invest in self-education. Don’t stop learning.
Support your trade association and join industry
fairs and events.
Make the workplace a happy place.
Practice clean production. Protect the environment.
Love what you do.

KEMWERKE, INC:
Finding
the Right Mix
of Business
and Chemistry
BY VERONICA VELARDE PULUMBARIT
12
SME.COMmunity.PHilippines
A
Filipino chemical
company, Kemwerke
Incorporated, is
proving that business
and chemistry can mix,
especially if stirred in with the
right entrepreneurial attitude
of passion, perseverance, and
honesty.
Luis G. Fernando, president
and managing director
of Kemwerke, says “You
need to have passion in your
work, products, and services.”
Without passion, it will be difficult
for entrepreneurs to sustain
their businesses, he says.
Passion is exactly what
Fernando has for his company
and its products, mainly coco
alkyd and polyol resins. Unlike
conventional petroleum-based
resins, Kemwerke’s products
are derived from environmental-friendly
and renewable
coconut. These coco-based
specialty chemicals are exported
to 29 countries.
Fernando, a chemist, says
that developing coco-based
resins will help boost the
Philippines’ competitive advantage
as the world’s largest
coconut oil exporter. The
country produces about 950
million metric tons of coconut
oil per day, representing 70
percent of the world demand.
“In our country, the
coconut is both abundant
and indigenous,” he says.
The tropical climate of the
Philippines makes it possible to
grow coconut on a commercial
scale almost anywhere.
Around 3.2 million hectares
of farmland are devoted to
growing the crop and 1.6
million Filipinos depend on it
for their livelihood, so a welldeveloped
coconut industry
will have immense social
impact on the quality of life
in many impoverished rural
communities.
Wonder Product
Kemwerke’s main products,
the short oil coconut alkyd
and polyol resins, are used as
coatings that provide brilliance,
gloss, and durability to different
materials: metal, plastic,
paper, wood, and ceramics. Its
applications include car bodies,
ship hulls, soda cans, packaging,
furniture, wall boards
and floor tiles.
Kemwerke also manufactures
polyester, aluminum
paste, ester gum and other
products for the paint, ink,
and adhesive industries. Up
to 97 percent of Kemwerke’s
products are exported overseas.
Its biggest client to date
is Akzo Nobel Extrusion Coatings,
the world’s largest paint
and chemical company.
Fernando says Kemwerke
was previously known as Philippine
Pigment Incorporated
(PPI). About 50 years ago, he
started his career as a research
chemist at PPI. Eventually, he
moved up the corporate ladder
until he became its president.
In 1983, Fernando and his
business partners bought PPI
and formed a new company,

SME FOCUS
Kemwerke. “I never expected
in my dreams that I would one
day own the company I work
for,” he says.
He admits that going
into the chemical business
is not easy. The industry is
capital-intensive and highly
competitive. “To be profitable,
you need a lot of capital,”
Fernando explains.
For its operation, chemical
plants need a large tract of
land, raw materials, industrial
pipe systems, reactors, storage
units, heavy equipment,
transport systems, and others.
Fernando adds that
competition in the global
market is very stiff. Most of
their competitors abroad are
bigger, established companies
that are able to offer highly
competitive prices and terms
for products.
Kemwerke is dwarfed by
its German counterpart, which
is 50 times larger but still
classed as a small and medium
enterprise. While Kemwerke
might only be a microenterprise
by European standards,
Fernando says the company
has distinct advantages over
competitors abroad. Kemwerke
easily obtains its main raw
material, coconut oil, from its
local suppliers in Laguna and
Zamboanga.
Most of its competitors
abroad also source their supply
of coconut oil from the Philippines.
So, foreign companies
pay more for the same raw material
because of freight costs
and trading charges.
Another edge Kemwerke
enjoys over its foreign competitors
is that the company gets
the freshest supply of coconut
oil delivered to them on the
same day it was processed.
Fernando explains that
the shipping of coconut oil to
foreign companies takes about
33 to 50 days. Over time, the
product becomes discolored.
Produced from fresh coconut
oil, Kemwerke can boast of the
clarity of its products while
those of its competitors are
marked by a yellowish tint.
Big Challenges
Kemwerke bolstered the
country’s chemical industry
when it became the first alkyd
resin manufacturing plant
in the Philippines to bear the
ISO-certified seal of Quality
Management Systems from the
United Kingdom Accreditation
Ser vice in 2000. Kemwerke and
its 20-member team of production
and technical personnel
have consistently maintained
a record of high manufacturing,
safety and environmental
standards over the years.
Fernando laments that
despite the excellent quality
of their products, the biggest
challenges that remain are
product promotion and market
development.
Citing his experiences
in trade fairs in Asia, the
United States, and Europe,
I NEVER EXPECTED IN MY DREAMS
THAT I WOULD ONE DAY OWN THE COMPANY
I WORK FOR.”
Fernando said he always
had to work harder to prove
to international buyers that
a small Philippine company
like Kemwerke is capable of
producing unique, world-class
chemical products.
One particular experience
involving a German businessman
stands out. The executive
belittled Kemwerke’s product
line to the point of questioning
the “sort of chemistry that the
Philippines is capable of producing.”
Unperturbed, Fernando
patiently explained Kemwerke’s
operations to the German and
eventually won him as one of
the company’s clients.
Global Competition
Fernando compares the
competition in the world
market to the Olympics. He
says the global competition is
at a totally different level from
local competition.
“To be globally competitive,
you must have superior
quality, best price, and excellent
service,” he explains.
In the world market,
the foremost issue is the
quality of the product. He
advises exporters to obtain
globally recognized proof of
13
VOL. NO. 03 / ISSUE NO. 05

TO BE GLOBALLY COMPETITIVE,
YOU MUST HAVE SUPERIOR QUALITY,
BEST PRICE, AND EXCELLENT SERVICE
14
SME.COMmunity.PHilippines
excellence for their products,
such as an ISO certification in
manufacturing, or the HACCP
seal among food processors.
He adds that exporters
have to determine the most
competitive price for their
products. In the global market,
while returns may be higher
because of demand volume,
a company can easily lose a
lucrative contract by quoting
a price that is just a few cents
higher than its competitors.
To maintain a good and
lasting relationship with
their clients, exporters have
to provide excellent service,
he says. International buyers
will continue to do business
with a company that is proven
to be reliable, honest and
dependable.
Fernando also advises
his fellow entrepreneurs to
visit different countries and
explore the different business
opportunities available
to their company. To keep
abreast with developments in
the chemical industry, he has
been attending trade fairs and
conventions over the years.
Even now, he continues to
join seminars concerned with
exporting and doing business
globally. “I might pick up an
interesting theory that I can
put into practice later on,” he
says.
Fernando says the biggest
lesson he learned from
doing business globally is
the importance of trust. He
says international business
partners and clients have to
learn to trust one another and
work for mutual benefit.
Best Chemist
For his inventions, Fernando
received the 2007 Best Chemist
award from his alma mater,
the University of Santo Tomas
(UST), where he graduated in
1957.
He encourages young
people today to also consider
degrees in science aside from
law or medicine or information
technology. He feels the future
holds a lot for scientists and inventors
as well.
For him, science has been
very rewarding. He has led a
very interesting life, thanks
to his work as a chemist.
In fact, immediately after
graduating from UST where
one of his subjects was forensic
chemistry, he even had a brief
stint working as a crime scene
investigator for the National
Bureau of Investigation (NBI).
Fernando transferred to
PPI (Kemwerke today) because
he was interested in applied
chemistry. At age 27, his work
had already enabled him to
travel around the world.
Currently, Kemwerke has
two plant sites, the main office
in Pasay City and a new one
being built in Muntinlupa City.
The company plans to sell the
Pasay property and mobilize
additional capital to back its
expansion program.
Fernando remains optimistic
that Filipino companies
like Kemwerke will excel in
the global market because Filipinos
are hard-working, smart,
creative, and faithful people.
Today, at age 72, he isn’t
about to set aside his work
nor his advocacy of building
the country’s industrial base
through SMEs. He wants to go
on moving forward and keep
taking risks. “Without risk,
there is no success. It has to be
a calculated risk. If you never
take a risk, you’ll never move
forward,” he says. In that we
certainly can agree.
Luis G. Fernando
Kemwerke, Inc.
233-A C. De Guzman St., Malibay,
Pasay City, Philippines
Website: www.kemwerke.com
Email : info@kemwerke.com
Tel. No. (63 2) 853 4100

GLOBAL VIEW
10 Hints to ‘Catch’
the Right Employees
It’s really hard to get the right employees
if you are a small company. Therefore
a Small Business has to prepare and
more efforts in getting the employees
that are needed. First of all, we have only few
sources of man power:
Getting the right employees
for your small business
Chance to have an important
role and a word to say. Sometimes when
companies, they might feel they need a little
space for creativity and to prove themselves.
Get yourself prepared. Be
great idea its hard to get yourself heard, or
the curriculum vitae, google the person, try
Chances are that if you need quality and
colleagues as well.
performance you’ll have to go for the already
Be prepared to offer a payment
guy is a hippie or a yuppie you can adjust your
that is a little better at least.
way to go. You will need to compete with other
companies or sometimes corporations for the
you offer.
same people and you are most of the time
Sell your idea.
Use your customers.
in a disadvantaged position. So if you need
you have some interesting names, mention
people, you don’t just need resumes and wait
2 years
to sell yourself to the prospective employee.
Entrepreneur/manager
charisma. Sometimes you don’t have so
do
customers and opportunities—everything to
Confidence and stability.
get attention, commitment and interest—just
your charisma could increase your chances.
Capitalists. Because when prospective
Office space. Clearly your office
home office. You don’t want your potential
So what’s in the back of people’s
mind when they send their resumé
to your small business?
Photo from dreamstime.com
conditions and a pleasant environment.
Get dressed properly.
pajamas.
Think about the hidden
benefits you could offer without much
expense.
CRISTIAN DOROBANTESCU
is a part time entrepreneur
based in Bucharest, Romania.
He enjoys writing about
real life Entrepreneurship
experiences, small businesses
and knowledge resources
for any entrepreneur wanna
be. Besides blogging,
Cristian Dorobantescu is
an International Sales professional, dealing with
business development, affiliate marketing, online
sale and distribution for software products. He
is also a partner of the In PRogress Media Shop
and PR Agency. Read more articles by Cristian
Dorobantescu at: www.entrepreneur-interviews.com
15
VOL. NO. 03 / ISSUE NO. 05

TOOLKIT
16
SME.COMmunity.PHilippines
1
TRAVEL
2
PATRONIZE
3
SEE
4
SWITCH
5
UNPLUG
EASY
THINGS
YOU CAN
DO FOR A
HEALTHY
PLANET:
LIGHT. Walk or bike instead of driving a car if you need
to go someplace nearby. Cars and trucks run on fossil fuels,
which release carbon dioxide into the atmosphere. For every
kilometer you walk, bike or commute on public transport credit
yourself with 2 kilograms of carbon emission reduction. Two
kilos of carbon saved is also equal to saving one liter of gasoline.
PUBLIC TRANSPORTATION. Taking the
bus or the light rail saves at least 863 liters of gasoline
and cuts back over 1.5 tons of carbon dioxide emissions
a year.
THE LIGHT. Use compact fluorescent light bulbs.
These energy-efficient bulbs help fight climate change
because they reduce the amount of fossil fuels that
utilities burn. You will eliminate 230 kilos of carbon for
each incandescent bulb that you replace with a compact
fluorescent, over the life of the bulb. This is equal to
saving 98 liters of gasoline. The new cutting edge LED
lamps will even create a bigger impact when they enter
the market.
OFF YOUR COMPUTER MONITOR
WHEN NOT IN USE. Doing this saves power and
removes about 45 kilos of carbon dioxide from the
atmosphere yearly.
ALL UNUSED APPLIANCES. Any
appliance that is in standby mode is still consuming
energy.
One of the things many sales people dread is doing cold calls.
Try these tips to overcome your fears.
DO THE RESEARCH. Show prospects you’re interested
in their business by reading up on their background. Mention
an article that you just read that might be related to his or
her business. Doing this is a sure way to get your appointment
rate up.
WARM UP TO YOUR PROSPECT. Before doing a cold
call, send your prospect an inexpensive but unique item. It
can be a magazine clipping about the prospect’s business or
industry. How about a bright, well-made piece of origami with
6Products made from recycled paper, glass, metal
and plastic reduce carbon emissions because
they use less energy to manufacture than
products made from completely new materials.
For instance, you’ll save 4 kilos of carbon for
every 20 glass bottles that you recycle. Recycling
paper also saves trees and lets them continue to
reduce climate change naturally as they remain
in the forest, where they remove carbon from
the atmosphere. One kilo of paper recycled cuts
back 4 kilos of carbon dioxide emissions, equal to
saving 2 liters of gasoline or to planting 44 trees.
RECYCLE AND USE RECYCLED PRODUCTS.
7INFLATE YOUR TIRES. If you own a car, it will get
better gas mileage when the tires are fully inflated,
so it will burn less gas and emit less carbon. Check
your automobile monthly to ensure that the tires are
fully inflated. Follow this tip and save over 600 kilos
of carbon dioxide for every 16,000 kilometers you
drive.
8PLANT NATIVE TREES. Trees absorb carbon
dioxide from the air and use it as their energy
source, producing oxygen for us to breathe. A tree
that shades a house can reduce the energy required
to run the air conditioner and save an additional
400 to 4,000 kilos of carbon over its lifetime. Trees
also improve both aesthetic and property value.
Just remember to position the tree a manageable
distance from structures, utility lines and drains.
9DEMAND RENEWABLE ENERGY. If your
utility offers renewable energy, buy it. If
not, send them a message asking for clean
energy.
LIGHTER-WEIGHT AND UNCOLORED
PAPER WHENEVER POSSIBLE. Lighter-weight
paper uses less fiber, saves on mail costs, and often
10USE
costs less. Avoid neon (ultrabrite) paper, which is
laden with toxic heavy metals and makes this paper
difficult to recycle. Use pastel colored paper instead.
Photo from dreamstime.com
GETTING AN APPOINTM ENT
your business card? When you make your call, your prospect
most likely will say “Oh yeah, you’re the one who sent me
that…” It gets you remembered and makes you immediately
stand out from the crowd.
BE SPECIFIC WHEN ASKING FOR AN APPOINT-
MENT. Instead of saying, “would there be a chance to meet
with you sometime next week?”, be more specific. Say, “Is
Tuesday next week at 10:30 a.m. a good time to meet?”
RESPECT YOUR PROSPECT’S TIME. Get straight to the
point and say “All I’m asking for is 10 minutes of your time.”
This show’s you value that person’s time.

SALES TRAINING
A Primer on Providing Professional
Customer Service
In an increasingly competitive
market, the difference between
you and your competitors
often boils down to one crucial
factor—customer service. The reality is
that it has been proven time and time
again that a company’s success often
hinges on how customers view the
service provided. While it’s certainly
helpful to utilize technology to increase
customer loyalty, oftentimes it’s the
basic customer service 101 that makes
all the difference in the world when it
comes to turning a one-time customer
into a long-term client.
YOU ARE HOW YOU SOUND
It’s a given that using a negative voice
and tone with a customer is an absolute
no-no. However, there is frequently an
overall acceptance for an unenthused,
neutral voice. Call it what you like—blah,
bored, tired, or detached. Customers will
perceive a monotone voice as negative
and unhelpful. Paying attention to voice,
tone, sounding positive, energetic, and
consistently upbeat should be right at
the top of the list of ways to improve
your customer service.
THE DELIGHT IS IN THE DETAILS
Your customer service team needs to
be able to manage the basics of their
jobs, and customers expect that. But,
what makes the difference between soso
service and helpfulness that keeps
customers returning is paying close
attention to details. Following through,
keeping promises, and going that extra
mile for a customer is the key to loyalty.
Customers will always appreciate that
personal touch that makes them feel
appreciated and special.
YOU SAID WHAT?
With more and more communication
taking place online, often delivered in
bullets or short quips, it seems that
many have forgotten the benefits of
courteous dialogue. “Please,” “thank
you,” and “How may I help you?” are
far too frequently forgotten. By focusing
on using those tried and true words of
good customer service, you can go a
long way towards differentiating yourself
from a pack of poor communicators.
FRANKLY MY DEAR,
I DON’T GIVE A DAMN!
We’ve all had the experience of being
circulated around a complex phone
system, trying to reach a customer
service representative—punching
buttons, being redirected, then placed
on hold, and finally hung up on.
What’s the message that a company
projects with this lack of respect for
their customers’ time? A message of
indifference; and it’s a surefire way
to make your customers run straight
towards a competitor who can manage
to pick up their phones. While this is
one example of a lack of concern for
customers, there are countless other
ways that companies show they just
don’t care. The bottom line here - it
behooves every company to review
their entire customer service process to
seek out those deficiencies that create
challenges for their customers.
COMFORTABLY NUMB
Your market is continuously changing,
and so are the needs of your customers.
This requires a customer service team
to be adaptable and flexible. For this
reason, watching out for signs of
complacency and an inability to make
improvements is crucial and must be
corrected before your competitors
surpass you with more innovative
ways to better provide service to your
customers.
It’s easy to go after the quick fix,
particularly when it comes to customer
service. You can certainly improve the
efficiency of a team with a new phone
system or software program, but it won’t
necessarily improve quality. At the end
of the day, successful customer service
still boils down to people working with
people. Treat your customers the way
you want to be treated, and you will
be rewarded with the loyalty of your
customers.
Based in New York, Adrian
Miller is the president
of Adrian Miller Direct
Marketing, a sales training
and consulting company that
provides customized, resultsdriven
training programs
to companies worldwide.
AMDM’s programs focus on
the techniques and skills needed
for building new business and retaining existing business,
resulting in increased ‘ROA’ (Return on attention). She can
be reached at amiller@adrianmiller.com.
17
VOL. NO. 03 / ISSUE NO. 05

STRATEGIC PLANNING
for BUSINESS SURVIVAL
We are again facing serious
challenges as a result
of the recent corporate
failures to hit Wall Street,
the financial center of the world. Meanwhile,
local economists and policy-makers say the
Philippines will not be seriously affected by
the crash of Fannie Mae, Freddie Mac, AIG,
Lehman Brothers, Morgan Stanley, and other
financial brands yet to make headline news.
With collective exposure of the local
financial community that is supposed to
be only one percent of the liquidity base,
spokesmen say there is no problem.
Hopefully, this isn’t just a PR spin that could
unravel over the next 18 months or so.
In any event, it remains vital for the local
business community, particularly Small and
Medium Entrepreneurs (SMEs) to heed
the Scout motto “Be Prepared!” Like ship
captains who should pay close attention to
weather reports and sea charts, it is prudent
for SMEs to plan their course well ahead and
consider the best options to avoid or to ride
out the effects of a threatening economic
storm.
Even before the first squall hits, some
SMEs should be working to improve their
seaworthiness this early by cutting back on
costs or being more cost efficient. By getting
rid of excess baggage and patching the leaks
early, these companies can raise themselves
high above the waterline, just enough to
allow them to perform slightly above breakeven
during the distressed period.
Sacrifices come at a steep price and
entrepreneurs must be ready to keep
their hands steady on the helm. Staffing,
advertising, utilities, representation and
travel may be the areas first to be hit by any
budget cuts. Certain management privileges
and employee productivity incentives might
have to be reduced to generate the savings
needed to tide the company over.
Before strong medicine or more
draconian measures need to be prescribed,
SMEs must without delay conduct a review
of their business operations and financial
health, also known as a strategic planning
exercise.
Strategic planning is a process that
evaluates present and future operating
conditions that may harm the ability of the
company to move forward. In the exercise,
the company’s historical performance
comes under review in order to appreciate
how it arrived at its current market position.
Similar to a war game exercise, all possible
business scenarios are simulated and
various game plans are developed in
addressing the possible issues. Done right,
a strategic planning activity will enable SME
management to identify and anticipate
actual and potential threats, make critical
decisions and take the necessary actions for
business survival.
18
SME.COMmunity.PHilippines
THE BASIC PROCESS
Assess Business Performance
Go back at least 2 years. Establish where
the company succeeded or experienced
operational difficulty in meeting its income
and profit goals. Create an operations and
performance matrix for each key functional
department – Finance, Human Resources,
Sales, Marketing and Production to
establish their SWOT (strength, weakness,
opportunities and threat) factors. Then
create an overall organization matrix that
cites each department’s place within the
quadrant.
In the case of the sales and marketing
functions, latest consumer and trade market
surveys should be one of the key reference
points in finding out brand health. If there
isn’t any formal data available, there should
be a strong effort to organize it.

MARKETING
Photo from dreamstime.com
Draw the Conclusion
From the data matrix, management can now
determine its operational strengths and
weakness as well as the negative or positive
impact of these factors on profitability and
the commercial viability of the business.
Management can now establish what
factors will affect its ability to move forward
effectively and efficiently.
Set the Goals
Where there are issues, there should be
solutions. For each concern, determine
the objectives for improvement. From
quantifiable data, select the minimum
benchmark. For example, if there is poor
productivity, “better” productivity should be
set at a numbered goal, whether you are
looking at 60 labor minutes per finished
item, 1000 liters of used coconut oil
processed per day, P45,000 in donut sales
per week or zero accident per building site.
State the Strategies
Strategies are the actions steps or the
activities that achieve the goals that are
being set. Many however have the tendency
to mix up a goal statement with a strategy
statement. Each functional department
should develop a strategy statement as it for
example improves on its productivity output
while decreasing its operating cost.
Departments with a high head count
normally equates to a higher cost over
others that are either understaffed or have
the right number of people delivering the
functional tasks required of them.
If a department has too many personnel
doing less work, the goal statement would,
for example be, “to decrease the operating
cost without reducing its functional
effectiveness in the organization.” A strategy
is to review the task load of the department
relative to its staff count and re-align the
task load to the suitable headcount. Excess
personnel shall be transferred to other
understaffed departments, and service
retrenchment shall be applied for staff who
will not be absorbed.
Determine the Risks
Before formalizing the strategy, consider the
risk factors that may go along with it. What
could go wrong? Will a cost cutting strategy
that desires to protect the bottom line be
an exercise of being ‘penny-wise and pound
foolish’? State the possible risks for the
record so that if management agrees to the
proposed strategy, it is aware of its possible
failure points.
The media and trade marketing
budgets are often the first to be slashed
when profitability is threatened. If the
company’s fast moving and highly profitable
products are competing in a marketingdriven
environment, cutting down on media
spending or trade marketing support is not a
good idea. The ill-supported brand will see
weakening demand as its target market’s
purchase attention will be grabbed by more
visible rivals.
Measure the Results
There should be a KPI (Key Performance
Indicator) or a KRA (Key Results Area) that
serves as the grading criteria for the success
or failure of the strategies that are associated
with the goal statements.
Management uses these barometers
in evaluating the team’s performance—
department head and staff which will impact
on their salaries and upward promotion.
The shareholders likewise uses these same
grading criteria in determining the company’s
business health so that they can make the
right decisions in further supporting the
company, or creating its exit strategy.
At the end of the day, the exercise will
have its golden value in preparing for the
worst and hoping for the best, or forging
more aggressively forward if the economic
challenges will not be clear hindrances at all.
Herbert M. Sancianco has over 20
years of experience in advertising,
marketing and sales operations.
He owns and manages Market
Bridges, Phils. Inc., a full
marketing services company,
with offices at 11-0 Burgundy
Corporate Plaza, 252 Sen. Gil
Puyat Avenue, Makati City.
The author can be reached at
mbpidmbc@i-manila.com.ph or
at Tel: (63-2) 886-4122 to 23.
19
VOL. NO. 03 / ISSUE NO. 05

Making Sense
of the U.S. Financial Crisis
20
SME.COMmunity.PHilippines
What funded
Sub-Prime Lending?
Subprime lending was developed in
the late 1990s in the United States and
became popular in the past five years.
Subprime lending simply means lending
to people who have questionable capability
to repay the loan. Banks, generally,
lend to prime clients or those who have
a good credit rating. A good credit rating
is earned by showing the capacity to pay
back loans, no history of late or non-payments,
acceptable property for mortgage
etc. Those who do not pass the bank
checklist are below prime or “subprime”.
In any transaction, the higher the risk,
the higher the rate. Subprime loans carry
very high risks for the lender and thus,
have very high interest rates.
Photo from dreamstime.com
The subprime market was an opportunity
for financial institutions to generate
more profit by developing securities
(tradable investment instruments) related
to subprime loans. With aggressive global
investment banking, these investment
instruments with high returns reached
financial markets all over the world and
were snapped up by all kinds of funds.
As demand increased, the U.S. financial
institutions granted more and more Subprime
loans.
Over the past 10 years, the world
saw massive inflow of capital to the U.S.
Savings from Asia and Europe were seeking
investment venues to fund their social
overhead and sustain positive economic
growth. Only the U.S. had the capacity to
absorb these funds. Housing-related investment
instruments, subprime lending
included, offered a unique opportunity to
the entire world.
Meanwhile, the culture of credit
spending was pushing the American
public to consume more. With credit
cards, liberal consumption and now liberal
housing loans, America increased its
importation thus sending its dollars to
China, Europe and Asia. Awash with U.S.
dollars, these countries were snapping up
U.S. Treasury Bills and Bonds and mortgage
notes. It was and continues to be a
vicious cycle.
On the other hand, the U.S. housing
sector, was going wild. Lenders having
cheap funds from the world gave out
loans right and left mostly based on perceived
increasing value of houses. Mortgage
brokers wanting to earn more commissions
pushed borrowers to cash in on
their “home equities” or to borrow more
using their now higher valued homes as
collateral. With additional loans, they
could fund everything from consumer
goods such as toys, plasma TVs (from
China and Asia), cars, vacations, second
and even third homes. Freddie Mac and
Fannie Mae, two Government Supported
Enterprises (GSEs) accelerated its massive
purchases of mortgage papers from
U.S. domestic lenders and issuances of
credit guarantees to U.S. as well as global
investors.
Investment Bankers
and Insurers became more
creative to fuel more credit.
More money was made available as investment
bankers and insurers became
even more creative issuing asset-backed
securities and forms of complicated debt
instruments. They are not restricted by
strict capital requirements as commercial
and savings banks. They bundled individual
mortgage notes valued based on the
increasing housing prices and sold them
off to domestic and foreign investors as
high yielding instruments. These are the
securities referred to as Collateralized
Debt Obligations (CDOs) and Collateralized
Loan Obligations (CLOs) and other
similar structured products.
No real attention was given to the
fact that a good number of these mortgages
were loans given to borrowers
with no real capacity to pay. The commission-driven
mortgage brokers aggressively
sought out borrowers and arranged
housing loans with banks. Banks were
eager to lend since they could sell these
same mortgages to Freddie Mac and Fannie
Mae very quickly. There was just too

MONEY MATTERS
much money available and too much
money to be made in giving out housing
loans.
These CDOs and CLOs became even
more saleable when Wall Street players
included something like an insurance
policy in the package (Credit Default
Swap or CDS). With the insurance guarantee,
rating agencies (like Standard and
Poors, and others) gave AAA ratings to
these structured products. Thus, even
top banks like UBS, and Citicorp invested
substantial amounts. Eventually, Citicorp
and UBS covered their huge losses of
$62Billion and $42Billion with new capital
right away. Latest information from
the IMF is that subprime losses of banks
have reached over $500Billion.
More and more investment instruments
based on the value of other assets
or financial instruments called Derivatives,
took over the financial markets providing
instant margins to traders, brokers, investment
bankers and insurers. These Wall
Street operations were producing sustained
profits out of buy and sell transactions
of CDOs and the growing liabilities
were not reflected in formal records (kept
off-books). All eyes were on the margins
and profits as if there were no real risks
and as if the increasing price of housing
which was the fundamental basis for the
asset value would never stop. The fact is,
it did.
In summary…
1. What funded Subprime? Too much
capital from foreign investors looking
for yields higher than what their own
countries could offer.
2. Where did these funds come from?
In the case of China and Asia, their
exports to the U.S. mostly made up of
consumer goods. In the case of the
Middle East, oil proceeds from global
energy imports.
3. How did Subprime get to grow to such
high levels?
a. Wall street’s creativity in developing
securities without adequate
regulation;
b. the failure of the established rating
agencies to properly assess
the true credit risks and;
c. the unmitigated insurance cover
(CDS) on payment defaults sold
over-the-counter. Neither the Insurance
nor Securities Regulators
regulated them.
The U.S. Credit Crisis
in Perspective
Here are a few statistics cited from the
presentation of Mr. Helmut Schnabel,
Chairman of the International Association
of Financial Executives Institutes (IAFEI)
in its summit on September 5, 2008.
1. Total Subprime mortgage loans in U.S.
in 2007 was $1.2 Trillion.
2. Total private mortgage loans in U.S.
today is about $12 Trillion
3. Total non-mortgage debt of private
households (i.e. credit card, auto
loans and other consumer credits) is
$2.5 Trillion
4. Total U.S. private household debt is
thus $14.5 Trillion
5. Net worth of private households in
U.S. in 2007 (i.e. their total assets
less their total debt) amounts to $58
Trillion.
6. Private household assets to their total
debt ratio is a healthy 5:1
7. Actual losses of banks and intermediaries
from Subprime loans are in
the magnitude of $512 Billion. This
represents approximately 3.5% of private
debt and less than 1% of private
household net worth.
8. In the last two weeks, new capital infusion
of almost $400 Billion was raised
to offset the above losses of the affected
financial institutions.
These numbers indicate that it is
more fear and panic that is causing the
present credit and thus liquidity crisis
to further drive financial markets down.
More than anything, it is clear that the
U.S. consumer and the economy remain
viable and nowhere near being in the
brink of collapse.
In the Philippines, we have the opportunity
to turn this global crisis to grow
our economy in our own way.
FRANCISCO J. COLAYCO is
an entrepreneur, a venture
developer and financial
advisor. He is the Chairman
of the Colayco Foundation
for Education (CFE) and
the Author of Bestsellers:
Wealth Within Your Reach
(2004 Book of the Year for
Business and Economics,
National Book Awards), Making Your Money
Work (Nominated for 2005 Book of the Year for
Business and Economics, National Book Awards),
Pera Palaguin Workbook and Money for Kids.
The books are available at National Bookstore,
Power Books and other bookstores. CFE conducts
talks, seminars, and workshops. Learn more about
our advocacy at www.colaycofoundation.com,
email info colaycofoundation.com, via SMS 0917-
8537333 or through 637-3741.
21
VOL. NO. 03 / ISSUE NO. 05

CONNECTIVITY
Globe Business Entrepreneurs’ Night:
A TOAST TO SUCCESS
The country’s top small and medium
entrepreneurs took time, off from their
very busy schedule to attend Globe’s
appreciation night at the Blue Leaf
Events Pavilion in Fort Bonifacio Global City, Taguig
held recently.
Guests consisting of Globe’s top small and
medium enterprise (SME) clients were invited to
a feast in honor of the Filipino business spirit. The
whole affair was a tribute to the successes of Globe
Plantersbank Chairman and CEO Ambassador
Jesus Tambunting as Keynote Speaker.
in improving their business,” she said.
Lead by Masigasig host, Jolina Magdangal, entrepreneurs
and VIP clients like Jeffrey Rogrador of
JPOI Jeans, Ric Mactal of Heaven’s Cure, Emmanuel
“Blyke” Dimatulac of Creamline, Mitch Gomez
of GM Bank and Rural Bankers Association of the
Philippines (RBAP), Rommel Juan of Binalot and
President of the Association of Filipino Franchisers,
Inc. (AFFI), Glen Yu of Seaoil, Ado Yap of Plantersbank
and business partners from the Department
of Trade and Industry (DTI) graced the affair.
Jolina Magdangal poses with Gil Genio, Head of
Globe Business and Maridol Ylanan, Corporate
and SME Segments Head, Globe Business
Business’ SME subscribers. It was highlighted by a
special dinner prepared by no less than the Woman
Entrepreneur of the Year and special Globe Masigasig
awardee (in Ernst & Young 2008 Entrepreneur
of the Year Awards), restaurateur and chef
Margarita Fores of the Cibo chain of restaurants.
The event was made even more memorable
as celebrated entrepreneurs led by Fores shared
their victories and how Globe Business helped in
the growth of their business via a special video pre-
success stories with the help and support of Globe
Business.” Fores added.
Keynote speaker, Planters Development Bank
(Plantersbank) Chairman and CEO, Ambassador Jesus
Tambunting, gave a stirring narration on how he
led Plantersbank into becoming one of the top 20
banking institutions in the country and one of the
key proponents of SME development. “Proof of this
is the numerous awards and citations from government,
multi-lateral and guarantee institutions, and
international organizations the bank received for
excellence in SME finance,” he revealed.
AFFI members toasts with Globe Business’s
Maridol Ylanan (sixth from left), Jojo Catalan,
Globe Business Product Marketing Head; Bards
Montanido, president of Chicharific by J.E.E.
Lapids; Teresita Ngan Tian, president of Lots’A
Pizza; Alain Sebastian, Globe Business Segment
Marketing Manager; Rommel Juan, president of
Binalot Fiesta Foods Inc.; Maridol Ylanan; Richard
Sanz, president of Tea Square and Bibingkinitan;
and Wool Reyes, general manager of Royal
Carribean Finest Jamaican Patties.
Globe gave away raffle prizes especially selected
to pamper its hardworking subscribers such as
gift certificates for spas and fine-dining restaurants,
free hotel accommodations, and the much-awaited
iPhone 3G Globe mobile phone.
From left, Tomas Gomez IV, president of GM
Bank, Michelle Perlas, Globe Business Segment
Marketing Manager, Vincent Mendoza of Filipino
Saver’s Bank, and John Owens, Chief of Party,
USAID-MABS.
22
SME.COMmunity.PHilippines
Masigasig Awardee Margarita Fores (3rd from left)
together with Maridol Ylanan, Cristina Araneta-
Ferreira, operations manager of Cibo and Gil
Genio.
sentation. Fores even mentioned her dependence
on Globe for her communication needs. “I’m trying
to imagine what business would be like without
my Globe phone and I don’t think it would be the
same,” she said.
“So again, I salute you my fellow entrepreneurs
and I salute you as you continue to build your own
According to Globe Business Head Gil Genio,
the affair was a chance for Globe to recognize and
value its loyal customers. It also served as a way to
foster fellowship between Globe Business and its
SME clients and other strategic partners.
“Globe Business wants to keep its customers
its topmost priority. This appreciation night is a celebration
of the hardworking entrepreneurs of the
country… a chance to let them spend some quality
time away from work,” Genio added.
This was confirmed by Maridol Ylanan, Globe
Business Corporate & Segments Head. “This is our
chance to meet with and talk to our customers. It
also gives us an opportunity to inform them of our
other products and services that they may also use
VIP client Emmanuel “Blyke” Dimatulac of
Creamline (second from left) together with
Andy Carandang, Globe Business Territory Sales
Manager, Ronnie Roldan, Globe Business Sales
Head and Dennis Marquez of Globe Business
Territory Sales Head.

TECHNOLOGY
BY EDONG MENDOZA
There are a million reasons why
businesses—whether large or
small—need to keep employee
work hours in check. The most
obvious reason of course is to ensure
individual attendance records are consistent
during office hours.
In the most part of the 20th century,
timekeeping methods were fully
manual or semi-automated to an extent.
Bundy clocks and time cards were
the most popular means of tabulating a
worker’s “ins and outs”. All one had to
do was pop in a card into a clock and
presto – instant attendance record. But
the bundy clock system was, for lack of
a better word, primitive and it had a lot
of loopholes. Oftentimes, an employee
could simply ask a co-worker to punch
in/out for him just to avoid performance
demerits or salary deductions. Worse off,
if an employee was in cahoots with the
timekeeping officer, he or she could even
get away with murder, so to speak.
With the widespread introduction
of computers in the mid-‘90s, timekeeping
took on a more modern and familiar
face. Magnetic cards that you can swipe
or flash on a sensor became the most
popular means of logging in. Big corporations
even had the money to set up a
computerized infrastructure to track an
employee within its premises solely by
detecting where the ID was last used.
Again however, this is still prone to fraud
as anyone – even a total – stranger could
use a stolen or borrowed ID to punch in
and even gain access to various parts of
an office. And as mentioned, only big corporations
at the time could afford to set
up such a pricey system of computers.
Enter the Philippines’ internet age
a.k.a. the broadband boom of the early
21st century. The many changes in computer
use and the public acceptance of
the internet have opened doors to employers
(even the smaller ones) that no
one even dreamed of a decade ago.
Today, Biometric devices are a common
sight in many offices. Biometrics in
simple terms means analyzing a part of
your body.
The most common device thus far
is the finger scanner. It looks just like an
ordinary card-swipe module except that
is uses a scanner to recognize an individual’s
fingerprint. Given the very nature
of fingerprint patterns, this is in theory a
fraud-proof and accurate system. Technically,
the only way anyone can bypass the
system is to try to copy someone’s fingerprint
using specialized forensic equipment
and techniques or by other means
that are too morbid to mention here.
The increased connectivity with the
internet and intra-office networks also
takes this system of timekeeping a step
higher. By utilizing the power of the web,
transactions can now be conducted online
simply by logging on to a website.
Officers will be alerted via email if an employee
is requesting for an approval and
conversely, the employee will be notified
if the transaction has been approved.
It’s fast, it’s hassle free, and it eliminates
confusion since the transaction no longer
involves a middle man.
Before, transactions had to be done
manually in the office in the presence of
managers and timekeeping officers. More
people involved means more chances
for things to get lost in translation. There
have been many cases when employees—through
no fault of their own—had
to accept unnecessary salary deductions
because of unapproved official business
(OB) and overtime (OT).
With this new and innovative system,
employers are now also given instant
feedback of employee attendance.
By observing the collected data, managers
can optimize or customize company
work hours depending on how they see
fit. Say for example if a work shift of 9am
to 5pm results in frequent tardiness,
managers have the option to adopt a later
shift that maintains the same or better
level of productivity.
With all the benefits of this new system
however, we should remember that
this is just a tool and will not guarantee
sweeping changes in the workforce without
the participation of the employees.
Increased productivity and security still
rely on how the system is implemented
and how well its purpose is understood
by employees on all levels.
Photo from dreamstime.com
23
VOL. NO. 03 / ISSUE NO. 05

BOOK REVIEW
JOSIAH GO:
FUNDAMENTALS OF MARKETING
IN THE PHILIPPINE SETTING
BY JOEL SALUD
24
SME.COMmunity.PHilippines
There is a level of expertise in Josiah
Go’s Fundamentals of Marketing in
the Philippine Setting that practically
and fundamentally sets it a number
of notches above the average marketing book
written and published outside the country.
Firstly, as most marketers in the Philippines
will agree, it is a book whose time has come.
Much of what has been deemed today as the
best resource materials on marketing and product
communications are foreign—mostly American
and British—and dons advice that works
only on a very limited scope, particularly, that
of their specific countries and region.
They use demographic profiles long and
far removed from the local market, hence much
of it may prove ineffectual in the Philippines.
That’s why it is interesting to note that most
of these foreign marketing books provide only
generalizations and overviews on the marketing
thrust of very specific products. Marketers
are fully aware that although these books serve
a certain amount of purpose, it is far and away
indifferent to the necessary particulars needed
to make a successful marketing campaign in
the Philippine setting.
Go’s book, on the other hand, dares to
venture into more specifics and splashes his
propositions with domestic color.
Secondly, the knack for detail of author
Josiah Go borders on the impressive. He quotes
from a wide array of sources and provides a
working history for each product’s coming of
age in the market. Whichever angle one wants
to view it, Go opens the door for the reader to
see clearly through a microscope, so to speak,
and challenges potential marketers—seasoned or
otherwise—to base his decisions on a number
of facts. Go tackles misconceptions as well as
threats, branding as a product strategy, how to
manage product lines, distribution, brand and
institutional advertising, and a host of other significant
topics. By and large, it is a book that is
as serious as the Bible, and undoubtedly, no less
inspiring to marketers as he underscores in every
page more than a bilateral preview of possible
strategies.
Go manages in this volume to look at every
slant and perspective with eyes for detail and
a generous dash of product history and working
philosophy. From listing big-name brands to
smaller, less recognizable products in the market,
he plots a blueprint of how these products
were marketed complete with their initial failures
and successes. The updated research alone in
this book is an amazing account of the Philippine
marketing field, its creases and “fox holes”, all the
while painting a bigger picture of the professional
landscape for all marketers to appreciate.
In his section that deals with psychographic
segmentation, Go unleashes a witty discussion
on what should be considered as a reliable market
profile. His variables range from social issues
to personal interests, each delineation providing
a more specific division of the profile. On social
issues, he divides them into religion, politics,
work, drugs, women’s rights and sex—quite a
brave slice of the commonplace buyer. This is
how he ensures the broadest coverage, so he explains
in his book. Then he cuts them down into
even smaller segments that disclose personal or
group character.
He also includes a more contemporary topic
in marketing—Green Marketing—where environmental
concerns are woven into the very fabric
of product development. Go explains: “Marketers
should take a proactive role and assume
responsibility for their products and packages
after use, i.e. recycling/reuse, and disposal…
This kind of thinking is patterned after the total
quality movement (TQM) where the basic tenet
is that quality is doing the right thing, the
right way, doing it right the first time, on time,
and all the time… An ecological misstep can
mean customer disapproval and even boycotts,
government fines, massive clean up costs, and
wasted time and effort.” Believe it or not, it’s a
bold and new concept much in the same token
as the discovery of the New World.
The section on price adjustments gives
the reader easy understanding of the factors
that dictate fluctuations in product costs. In
fact, Go makes a daring statement on the nature
of a price rollback in this book. Contrary
to general public perception that a rollback is
actually a sign that the economy is doing pretty
well, for Josiah Go, price reduction “is perceived
as a sign that something is wrong and needs
correcting.” In this day and age of sporadic price
hikes and weekly rollbacks, the insight into what
influences prices is a must-have.
All in all, the book serves as an inspiration
to marketers as the philosophies and strategic
thrusts of more than a hundred big-name companies
operating in the Philippines are explained
in this volume.
Josiah Go’s Fundamentals of Marketing in
the Philippines Setting, an integration of his first
three books, is endorsed by the Philippine Marketing
Association and the Association of Marketing
Educators. The book is now available at your
favorite bookstores.