CITY OF GENERAL SANTOS: BUSINESS PLAN ON THE

PROCESSING AND MARKETING OF COCO SYRUP

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 CITY OF GENERAL SANTOS: BUSINESS PLAN ON THE
PROCESSING AND MARKETING OF COCO SYRUP
TABLE OF CONTENTS  Page

 LIST OF TABLES
 LIST OF FIGURES
 COVER PAGE
 SUMMARY OF INVESTMENT REQUIREMENT AND SOURCES OF
FUNDS
 FUND SOURCES AND ALLOTMENT
 EXECUTIVE SUMMARY 11
 Section I: DESCRIPTION OF BUSINESS ENTERPRISE 16-31
 A. Opportunities for the Enterprise and its Products 16
 B. Business Overview 25
 C. Product and Services 29
 Section II: MARKET ANALYSIS 31-37
 A. Market Characteristics 31
 B. Target Customer Profile 36
 C. Supply and Demand Analysis 37
 Section III: COMPETITORS’ ASSESSMENT 37-41
 A. Current Market Share 37
 B Relationship with Customer 38
 C. Price, Distribution, product and Service Feature 40
 D. Financial Strength 40
 E Length of Time in Business 41
 Section IV: MARKETING PLAN 41-46
 A. The Product 41
 B. Pricing Strategies 43
 C. Place of Product Distribution 44
 D. Promotion 46
 Section V: OPERATIONAL PLAN 47-57
 A. Ownership and Management 47
 B. Resources and Production 51
 C. Facilities and Equipment 55
 D. Operation 57
 E. Compliance to Local and National Regulations 57
 Section VI: SOCIAL AND ENVIRONMENTAL SAFEGUARD 58-68

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 CITY OF GENERAL SANTOS: BUSINESS PLAN ON THE
PROCESSING AND MARKETING OF COCO SYRUP
 A. Social Safeguard Aspect 58
 B. Environmental Safeguard Aspect 64
 C. Social and Environmental Impact 68
 Section VII: FINANCIAL PLAN 68-79
 A. Sources and Application of Funds 68
Investment Requirement by Component and by
 B. 69
Source
 C. Recording System 70
 D. Financial Forecast/Projections 70
 E. 10 Year Projected Cash Flow Statement 72
 F. 10 Year Projected Income Statement 73
 G 10 Year Projected Balance Sheet 75
 H Financial Analysis 76
 I Break Even Analysis 78
 J Sensitivity Analysis 79
 Section VIII: ECONOMIC ANALYSIS 80
 Section IX: SUSTAINABILITY MECHANISM 81
LIST OF TABLES

No. Title Page

1 Top 5 Coconut Producing Countries 17
2 Coconut and Cocal Area in Sarangani and Gen. Santos City, 2015 21
3 Gen. Santos Coconut Statistics, 2015 21
4 2012 Coconut Statistic of Region XII 32
5 Competitors Market Share 38
6 List of Buyers of Coco syrup 39
7 Nutritional Comparison of popular sweeteners 42
8 Staffing qualification and responsibilities 50
9 Detailed Process flow with staff responsible 53
10 Facilities and Equipment needed for the operation 56
11 Fund Sources and Allotment 68
12 Investment Requirement by component and by Fund Source 69
13 Financial Assumptions 70
14 10 Year projected Cash Flow Statement 72
15 10 Year Projected Income Statement 73
16 10 Year Projected Balance Sheet 75

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 CITY OF GENERAL SANTOS: BUSINESS PLAN ON THE
PROCESSING AND MARKETING OF COCO SYRUP
No. Title Page
17 Payback Period 77
18 Break even Analysis 78
19 Sensitivity Analysis 79
20 Income Comparison with and without PPRDP 80
21 Increase of Jobs generated by the enterprise 81

LIST OF FIGURES

No. Title

1 Philippine Coconut Industry 18

2 Philippine Coconut Production, 2010 to 2014 18
3 Coconut Non-Traditional Export 20
4 Production Process Flow 27
5 Comparative Analysis of Coco Sugar and Brown Sugar 30
6 Top 3 Producers of coconut 33
7 Distribution of Coconut Sap sugar in Export Market 34
8 Market share of Coco sugar per Region 35
9 Top 10 Countries with Coconut areas harvested 36
10 Association Organizational Structure based on DOLE Registration 48
11 Projected Operational Structure 49
12 Production Process Flow 53
13 Production to Marketing Operation 57

Enterprise General Profile

 
Subproject Title PROCESSING AND MARKETING OF COCO SYRUP

Subproject ID No.

Location Purok Pao-pao, Barangay Sinawal, General Santos City

Lead Proponent

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 CITY OF GENERAL SANTOS: BUSINESS PLAN ON THE
PROCESSING AND MARKETING OF COCO SYRUP
SINAWAL SMALL FARMERS’ ASSOCIATION
Group
Cluster Members None
Financial Modality
Based on the Amount Micro Enterprise – Php 3,037,000.00
of Subproject
Type of PG
Undertaking Start-up
Nature of Expansion/
Upgrading (for SPs Not Applicable
under the expansion/
upgrading Category)
Commodity/ Coco Syrup
Product/ Service
Volume of Existing : Currently, coco Syrup is produced and sold on a household and
Production individual basis; not as an association

Target Volume:
Year Target Production (in Kgs)
1 681,333.33
2 715,400.00
3 751,170.00
4 1,577,457.00
5 1,656,329.85
6 1,739,146.34
7 1,826,103.66
8 2,088,714.03
9 2,209,585.43
10 2,430,543.97

Target Market/s Indicate name of buyer, volume to be sold (existing and/or target
volume) and arrangements
Frequen
Target Existing Target Vol Payment Marketing
cy of
Buyer Vol Sold Sold Terms Arrangements
Delivery
Suchero Not
30 tons/mo Weekly Cash Yes
(TCGI) applicable

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 CITY OF GENERAL SANTOS: BUSINESS PLAN ON THE
PROCESSING AND MARKETING OF COCO SYRUP
Total PG Equity
Investment Cost/ Detailed LP GOP LGU
Cash Kind
Amount of the Items
Business Plan Enterprise
1,517,400.00 505,800.00 505,800.00 508,000.00
Operation
Civil
Not applicable
Works
Total
Investmen Php 3,037,000.00
t Cost
Support to The Processing and Marketing of Coco Syrup Subproject is one of the
Commodity Value segments within the value chain for coco sugar. The coco syrup is an
Chain Upgrading intermediate product derived from coco sap. The coco syrup will further
be processed into coco sugar.

Coconut is the top priority commodity of the City of General Santos. The
processing and marketing of coco syrup is one of the alternative business
opportunities aside from copra making that our coconut farmers can take
advantage of.
Brief Description of The proposed subproject entitled “Processing and Marketing of Coco
the Subproject Syrup” will be undertaken by the Sinawal Small Farmers’ Association.
The members of the association will be tapping the sap of the coconut
trees and process it into coco syrup. The coco syrup produce will be
consolidated and delivered to the identified buyers on a weekly basis.
Identified buyers such as Suchero in Tupi, South Cotabato, Free Foods in
Davao City and Gees Organics in General Santos City are those that are
producing coco syrup and other syrup-based products.
Enterprise or General Objective:
Subproject Objectives The subproject aims to improve quality of life of the members’ coconut
farmers who are engaged into coco syrup production, especially the
Indigenous Peoples in the communities covered by the proposed project,
by increasing their income from their coconut farms.

Specifically, this project aims to achieve the following:

1. Household income will increase by more or less 94% (from Php
58,377.78 to Php 1,013,392.10) as a result of changing the means
of livelihood from the production of conventional copra to the
production of coco syrup.
2. Five percent (5%) increase in value of annual marketed output as
a result of the increase in the productivity of the coconuts
3. There will be a 100% increase in hectarage covered by the project
in year 3 onwards (from 40 hectares to 80 hectares). There will be
eighty four (84) direct beneficiaries which is consist of farmers,
tappers and syrup makers that will be covered by this project. In

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 CITY OF GENERAL SANTOS: BUSINESS PLAN ON THE
PROCESSING AND MARKETING OF COCO SYRUP
addition, there will be 34 women who will also benefit from the
proposed enterprise.
New Ways of Doing At present, the members of the Sinawal Small Farmers’ Association are
Things/ Innovations producing coco syrup on a household or individual basis. However, these
are in small quantities. Hence, there is a need to consolidate their
produce, through which the the association will be the one to market
their product in bulk. This is to be able to generate more volume of their
product which could facilitate bargaining for higher prices and at the
same time be able for the members to forge relationships with the buyers
Socio-Economic PG
Beneficiari
Benefits Cluster IP Non-IP Total
es
Member
A. No of Direct Male Female Male Female
Individual Individual 28 56 - - 84
Beneficiaries Household - - -
(Specify Non-PG
Cluster
number per
Member
PG) Individual
Household - - -
Total 28 56 84

Job Generation Incremental Full time/

Job Title Existing New Jobs
Jobs Part time
160 tappers in Part time
160 tappers the 1-2 years
Tappers and additional 160
160 tappers
onwards
On Part time
Syrup
individual/hou 160 160
Makers/Cooks
sehold basis
Driver None 1 1 Full time
Helper/Laborers None As necessary Part time
General Manager None 1 1 Full time
Operations Full time
None 1 1
Manager
Cashier None 1 1 Full time
Total 324 324
Investment Cost per Php 37,011.90
Beneficiary
Target Increase In Without PRDP With PRDP
Farmers Income Annual Production of
Annual Production of Coco syrup
Conventional Copra
(1 hectare)
(1 hectare)

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 CITY OF GENERAL SANTOS: BUSINESS PLAN ON THE
PROCESSING AND MARKETING OF COCO SYRUP
Liters of
Nuts/ Annual Kilos of Annual
Kilos of Coco
year Income Coco Income
Copra Syrup/
(Gross) Sugar (Gross)
year

7,100.00 1,577.78 58,377.78 13,625.45 11,922.26 1,013,392.10

Footnote:
*13,625.45 Liters of Coco syrup – Annual Target volume coco syrup
*11,922.26 Kilos of coco sugar – Annual target volume syrup converted into sugar
* Annual Gross income = Annual Target Kilos of coco sugar multiply by PhP 85.00/ kilo
Financial Analysis Existing Net Income (Baseline): N/A
Projected Average Net Income: 45,339,880.02
Net Income of the
Enterprise:
FIRR: 552% Payback Period: 2.25 months
Financial Ratios:
ROI: 1502% Benefit-Cost Ratio: 1.69

NPV: Php185,919,113.22
Break-even Analysis
(for each product):
Volume: 14,423.17 Price: Php39.55/kg Sales: 109,720,832.24
Technical Support Indicate agencies that will provide technical support/ assistance, nature
Services of assistance, costs involved and arrangements
Nature of Technical
Agency Estimated Cost Source of Funding
Assistance
Department of Preparation of c/o RPCO/PSO DA-PRDP
Agriculture necessary
documents before,
during and after
project
implementation

Monitoring and
evaluation
Phil. Coconut Production c/o PCA regular
Authority (PCA) technologies programs
Local Government Selection process c/oCity
of General Santos Preparation of Agriculturist Office
necessary regular programs
documents for
before, during and
after project
implementation

Monitoring and
evaluation

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 CITY OF GENERAL SANTOS: BUSINESS PLAN ON THE
PROCESSING AND MARKETING OF COCO SYRUP
Target Start Date: (target date for the first NOL2)
Duration of Project
Implementation Target Completion Date: (target date of inspection and acceptance)

Subproject Summary Data/Monitoring Sheet (This summary should show that indicators
would be useful in measuring the impact of the subproject or PRDP interventions. The impact
should indicate the Project Development Objectives and the subproject specific objectives)
Parameters Baselin Year1 Year Year Year Year Year Year Year Year Year
e 2 3 4 5 6 7 8 9 10
Farmers
Income
HH Income
Marketable
Surplus
Income of
Enterprise
No. of
Women
engaged
Employment
Generated
Coop or
Asso.
Membership
Indicate
other SP
indicators

Project Cost
FUND SOURCES AND ALLOTMENT
COMPONENT and ALLOTMENT AMOUNT, Php
I-REAP (Enterprise Development)  
(60%) Loan Proceeds (WB) 1,517,400.00
(20%) Government of the Philippines (DA) 505,800.00
(20%) City Government of General Santos 505,800.00
(At least 20%) Proponent Group (SSFA) 508,000.00
Sub-Total (I-REAP) 3,037,000.00
Total Project Cost 3,037,000.00

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CITY OF GENERAL SANTOS: BUSINESS PLAN ON THE
PROCESSING AND MARKETING OF COCO SYRUP

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Total Project Cost

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 EXECUTIVE SUMMARY

Rationale

Coconut production is one of the main sources of livelihood of the people in the
countryside. There are 3.5 million coconut farmers all over the country and 25 million or
28% of Filipinos are directly or indirectly dependent on the industry.

The industry constitutes one of the four major sectors of Philippine agriculture,
aside from rice, corn and sugar. In fact, it is a dominant sector of the Philippine agriculture.
The country has the world’s widest geographical area planted to coconut. Specifically, of
the 12 million hectares of farmlands, 3.1M hectare is devoted to coconut and 68 out of 79
provinces are coconut areas.

In terms of production, about 85% is exported in the form of copra, coconut oil and
desiccated coconut. The industry is among the top 5 net foreign exchange earners, average
of US $760M per year. It has an annual average of 5.97% contribution to GVA and 1.14%
to GNP.

In the Regional level, SOCCSKSARGEN Region (Region XII) is among the top eight
coconut producing regions in the Philippines. It shares 6.3 % of the total land area planted
to coconut at 224,700 hectares with a growth rate of 2.3 % for the 5-year period, 2008-
2012. General Santos City is one of the coconut-producing cities of the region. Based from
the statistics of the Philippine Coconut Authority, the city has a total cocal area of 10,606
hectares which translates to 65,165,510 in terms of nut production. There are at least 2,574
farmers who are depending on coconut as their main source of livelihood.

Coconut has been tagged as the “tree of life”. The nut itself has numerous uses. One
of which is processing it into copra. Aside from copra, the nuts can also be processed into
other high value products. These include the following: coco flour, coco fiber, coco coir
dust or coco peat, activated carbon, coconut shell flour, ccoconut sap, coco syrup, coco
sugar, coco shell, coco water, desiccated coconut and virgin coconut oil (VCO).

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 It can be noted that coconut oil and desiccated coconut are some of the biggest
exports of the Philippines among all the agricultural products. Also, non-traditional
coconut–based export products such as coco sugar, coco water, coco coir and others are
also gaining prominence in the international markets, hence, expected demand to rise in
the coming years.

The increasing domestic and export demand of non-traditional coconut-based

products such as coco sugar presents a promising business opportunity for the farmers and
the small to medium enterprises who are involved in the various segments along the value
chain of the coconut sap sugar industry. The increase in demand could be related to the
high prevalence of diabetics and the growing interest of health enthusiasts locally and
worldwide.

Based on the City Commodity Investment Plan (CCIP) of General Santos City,
coconut is the first priority commodity of the city given the number of hectares planted
(10,243.71 hectares as of 2015) and the number of farmers (2,574 farmers) who are
dependent on coconut production as their main source of livelihood. Also, considering the
fact that the dynamic business activities of the city provides a lot of opportunities for
farmers and other stakeholders to be involved in the business segments along the value
chain of coconut.

With the above opportunities, coconut farmers in the city can now have the option
not to sell nuts or copra but focus instead in harvesting coco sap, process it into coco syrup
which can further be processed into coco sugar and other syrup-based food products. This
emerging trend can provide farmers not only with daily income but also offer a more
profitable coconut venture.

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The Business Enterprise

The proposed business enterprise will be having two (2) major components: (1)
coco syrup processing and (2) marketing of coco syrup.

The general objective of the business enterprise is to improve quality of life of the
members’ coconut farmers who are engaged into coco syrup production, especially the
Indigenous Peoples in the communities covered by the proposed project, by increasing
their income from their coconut farms.

Specifically, this project aims to achieve the following:

1. Household income will increase by more or less 94% (from Php58,377.78 to
Php1,013,392.10) as a result of changing the means of livelihood from the
production of conventional copra to the production of coco syrup.
2. Five percent (5%) increase in value of annual marketed output as a result of the
increase in the productivity of the coconuts
3. There will be a 100% increase in hectarage covered by the project in year 3
onwards (from 40 hectares to 80 hectares). There will be eighty four (84) direct
beneficiaries which is consist of farmers, tappers and syrup makers that will be
covered by this project. In addition, there will be 34 women who will also benefit
from the proposed enterprise.

The business enterprise will be managed by the Proponent Group, Sinawal Small
Farmers’ Association and will be the consolidator of coco syrup while clusters of individual
farmers will be the ones who will process the fresh coco nut toddy into coco syrup.

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The Products to be Produced

The product to be produced by the proposed business enterprise will be the Coco
Syrup.
Coco syrup is made from the coco sap which contains 80% water. The sap
undergoes a natural process of evaporation until it becomes a “toddy” or syrup-like
substance. One hundred percent (100%) of the farmers produce is marketed as coco syrup.
Production of coco syrup has been the main source of income of the farmers in the
area. With additional utensils that will be provided by the proposed project, more volume
and improved quality of coco syrup produce is expected.

Marketing Strategies

The Sinawal Small Farmers’ Association shall establish partnership with the
institutional buyers, processors and exporters to strengthen and ensure stable market for
their product. Since members of the association were already engaged in the production of
coco syrup on an individual/household level, current marketing agreements had been done
individually. With this, a new marketing agreement will be crafted between the association
and its identified buyer which is Suchero (TCGI) located at Tupi, South Cotabato.

Financial Analysis

The proposed project requires a capitalization of Php 3,037,000.00. The proposed

enterprise shows a positive cash flow. The Income Statement also shows positive net
return for the next 10 years of operation. As indicated above, net income is increasing on a
yearly basis as evidence by an increasing ROI. The proposed enterprise can generate an
average Net Income of Php 45,339,880.02. Average ROI is 1502% and average BCR is 1.69.
This means that for every one peso investment, there is a net return of 0.69 centavos. This
indicates high degree of profitability of proposed enterprise.

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 The Balance Sheet shows an increasing assets and net worth. In fact, the proposed
project will not incur liabilities, hence, can be considered as liquid and solvent.

The result of an investment analysis shows an NPV of Php 185,916,403.09 and an

IRR of 552%. By concept, a business will be considered as profitable if the NPV is positive
and more than its investment cost. This is satisfied by the NPV value which
Php185,916,403.09 for the next 10 years of operation which is very much higher than the
investment cost of Php 3,037,000.00. In addition, the IRR is 552%. As a rule, IRR value
should be greater than the interest rate/lending rate. The result shows higher profitability
since the IRR is 552% which is very much higher than the interest rate of 15%. Hence, the
proposed enterprise is very profitable.

In addition, the payback period is also used to gauge how long the investment will
be recovered. It is measured in the number of years. Based on the result, the proposed
enterprise will be able to recover the investment in 2.25 months. This is a good indication
since the investment can be recovered in a very short period of time. As a rule, investments
with shorter payback periods are more attractive to investors.

Break even analysis is the calculation of margin of safety the proposed project based
on the potential revenues and expected associated costs. This determines the level of sales
needed to cover the total fixed costs. Based on the results, the proposed project has an
average break-even volume of 14,100.52 kgs of coco sugar for the next 10 years of its
operations. On the other hand, the average break-even sales is at Php 1,371,277.71 for the
next 10 years.

Sensitivity analysis is a method used in determining the effect of a certain

dependent variable if there are changes in values of independent variables. In this
subproject, this tool is used to measure the effects on the Net Present Value, Internal Rate
of Return, Benefit-Cost Ratio and Return on Owner’s Investment if there will be increases
and decreases in both the revenues and costs associated with the processing and marketing
of coco syrup. Based on the results, the proposed subproject will still be earning profits

16 | P a g e
even if there are possible decreases in revenues and increases in costs for the next 10 years
of its operation.

I. DESCRIPTION OF THE BUSINESS ENTERPRISE

1. Opportunity for the Enterprise and its Products

The coconut tree or the ‘Tree of Life’ is one of the most versatile trees in the world
because of its many uses. It is also considered as one of the most important crops in the
country for its contribution in income of the farmers and for its foreign exchange earnings.
Coconut industry is one of the top industries in the world. In 2010, Brazil was the top
producer of coconut but as the year progresses the production of coconut products in Asia
has been patronized more for its quality.

According to the Food and Agriculture Organization of the United Nations (FAOStat),
Indonesia is the top producing country of coconut with 19,102,130 tons in 2014, followed
by the Philippines with 14,696,280 tons, India with 11,078,873 tons, Brazil with 2,919,110
tons and Sri Lanka with 2,181,000 tons. Production of India, Indonesia and the Philippines
contributes about 89% of the total world production of coconut products.

Table 1: Top 5 Coconut Producing Countries

  Coconut Production 2014

Country % of World Total
(metric tons)
1 Indonesia 19,102,130 mt 35.80%

2 Philippines 14,696,280 mt 30.00%

3 India 11,078,873 mt 23.30%

4 Brazil 2,890,286 mt 5.66%

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 5 Sri Lanka 2,513,000 mt 4.90%

Traditional coconut production of the Philippines is the main export product of

coconut. These are copra meal and coconut oil which contributes about 1.5% of GNP. It
employs, directly or indirectly, some 20 million people (about one-third of the population)
and earns more than US$510 Million annually.

The Philippines is one of the world's largest producers of coconut products.

According to the latest data from the Philippine Coconut Authority, about twenty-six
percent (26%) of cultivated land were planted with coconut trees and it is estimated that
between twenty-five percent (25%) and thirty-three percent (33%) of the population was
at least partly dependent on coconuts for their livelihood or about three million five
hundred thousand (3.5 Million) Filipino Farmers with twenty five million (25 Million)
Filipinos who are directly and indirectly employed by the sector. Figure 1 below reflects
the Philippine Coconut Industry Performance in 2010-2014.

Figure 1: Philippine Coconut Industry Performance (2010-2014)

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 Coconut Production (2010-2014)
18
16 15.54
15.21 15.24 15.35 15.21
14.7
14
12
10 Copra (Million MT)

8 Nut Equivalent (Billion)

6
4
3.03 2.55 2.51 2.76 2.61
2 2.19
0
2010 2011 2012 2013 2014 Average

Figure 2: Philippine Coconut Production 2010 to 2014

In the year 2010 to 2014, the Philippine coconut production has been somewhat
stable but it is noticeable that production for the 2014 was the lowest as shown in Figure 2

19 | P a g e
above. This was because of the typhoons that struck the country and the pest that
damaged the vast coconut areas especially in Luzon and Visayas.
Even with the challenges that the Philippine coconut industry is experiencing, the
production of coconut in Region XII were still stable since the provinces in the region does
not severely affected by this phenomenon. In 2012, Region XII has a total cocal area of
224,700 hectares where the city contributes about 9,014.50 hectares or 4.01%.
In 2015, General Santos City cocal area has increase from 9,014.5 hectares to
10,243.71 hectares. It has a total coconut trees of 1,024,371 where 729,174 trees are
productive, 188,650 are considered senile and 106, 547 trees are still in vegetative stage. It
has an assumption annual production of 65,165,510 nuts or is equivalent to 14,481.22 tons
of copra.

As mentioned above, coconut has been tagged as the “tree of life”. The different
parts of coconuts have various uses and benefits. The coco nuts itself has numerous uses.
One of which is processing it into copra. Aside from copra, the nuts can also be processed
into other high value products. These include the following: coco flour, coco fiber, coco
coir dust or coco peat, activated carbon, coconut shell flour, coconut sap, coco syrup, coco
sugar, coco shell, coco water, desiccated coconut and virgin coconut oil (VCO). These non-
traditional coconut–based export products are also gaining prominence in the international
markets, hence, expected demand to rise in the coming years (see Figure 3)

Figure 3: Non-traditional Exports

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 In the regional level, SOCCSKSARGEN Region (Region XII) is among the top eight
coconut producing regions in the Philippines. It shares 6.3 % of the total land area planted
to coconut at 224,700 hectares with a growth rate of 2.3 % for the 5-year period, 2008-
2012. According to the latest data from the Philippine Coconut Authority, General Santos
City has a total cocal area of 10, 243.71 hectares or 19.10% of the total land area of the city.
Even though General Santos City is considered as a highly urbanized city still produced
around 14, 460.24 Metric tons of copra based on the 2015 data of the Philippine Coconut
Authority.

Out of twenty-six (26) barangays in the city, twenty (20) barangays are engaged in
coconut productions which are mostly agricultural barangays. The city still has a potential
area of 2,503 hectares for coconut production. The top 3 barangays who have the largest
cocal areas are Barangay Conel with 2,638.60 hectares; followed by Brgy. Tinagacan with
1,411.41 hectares, and Brgy. Sinawal with 1,252.78 hectares. Since the urban barangays do
not have a compact area, coconuts are planted in the backyard of individual households
which are spread throughout the urban barangays. Table 3 shows the City’s coconut
statistics as of 2015.

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Table 3: Coconut and Cocal Areas in Sarangani and General Santos City, 2015.

No. of Trees
Municipality/ Total Land Total Cocal
Non- Total
City Area (ha) Area (ha) Bearing Senile
Bearing
Sar-Gen Total 455,184.90 111,733.22 6,402,297 3,105,139 1,665,885 11,173,321

Alabel 51,098.27 8,916.66 385,847 93,351 412,468 891,666

1,759,55 1,746,72
Glan 69,760.00 36,166.54 110,370 3,616,653
9 4
Kaimba 41,828.00 11,177.33 481,044 322,876 313,813 1,117,733

Maasim 54,338.00 12,168.50 687,940 302,699 226,211 1,216,850

Maitum 32,435.00 6,920.04 307,466 272,828 111,710 692,004

1,571,56
Malapatan 62,456.00 18,043.33 167,000 65,764 1,804,333
9
Malungon 89,663.63 8,097.11 479,698 11,011 319,002 809,711

Gen. Santos City 53,606.00 10,243.71 729,174 188,650 106,547 1,024,371

Table 4 : GSC Coconut Statistics 2015

No. of Trees Total Production
Land Cocal Potential
Copra
Barangay Area Area Non- No. of Areas
Bearing Senile Total (MT)/
(Has) (Has) Bearing Nuts/ Year (Has)
Year
Apopong 1,976.93 36.07 3,000 - 607 3,607 213,000 47.33 92.00
Baluan 1,163.54 351.20 24,096 10,327 697 35,120 2,444,069 543.13 54.00
Batomelong 1,261.75 569.82 32,284 21,523 3,175 56,982 3,820,322 848.96 59.00
Buayan 528.44 24.19 1,719 700 - 2,419 171,749 38.17 25.00
Bula 323.18 7.50 170 100 480 750 19,170 4.26 15.00
Calumpang 989.92 - - - - - - - -
City Heights 492.63 11.89 689 - 500 1,189 48,919 10.87 23.00
263,86
Conel 5,640.81 2,638.60 198,395 50,000 15,465 17,636,056 3,919.12 264.00
0
Dad. East 71.48 - - - - - - -
Dad. North 91.89 - - - - - - -
Dad. South 80.60 - - - - - - -
Dad. West 80.46 - - - - - - -
Fatima 1,842.59 - - - - - - -
100,15
Katangawan 1,976.35 1,001.59 67,756 30,000 2,403 6,940,676 1,524.37 92.00
9
Labangal 1,504.62 42.34 1,034 1,700 1,500 4,234 194,114 43.14 70.00
Lagao 1,413.36 223.41 16,925 5,000 416 22,341 1,556,682 345.93 66.00

22 | P a g e
Ligaya 637.71 359.33 26,729 8,000 1,204 35,933 2,465,759 547.95 30.00
Mabuhay 4,046.03 165.02 10,328 800 5,374 16,502 790,088 175.58 189.00
Olympog 1,764.25 709.29 46,837 12,000 12,092 70,929 4,177,436 928.32 82.00
San Isidro 1,444.60 96.17 7,393 2,000 224 9,617 666,875 148.19 67.00
San Jose 6,701.25 845.93 46,704 2,500 35,389 84,593 3,493,463 776.33 313.00
Siguil/Bawing 2,408.55 123.55 8,055 4,000 300 12,355 855,900 190.20 113.00
125,27
Sinawal 6,339.20 1,252.78 110,440 1,000 13,838 7,912,266 1,758.28 296.00
8
Tambler 6,009.09 105.89 6,580 2,000 2,009 10,589 609,206 135.38 281.00
141,14
Tinagacan 2,288.77 1,411.41 100,266 36,000 4,875 9,674,902 2,149.98 107.00
1
Upper Labay 2,528.00 267.73 19,773 1,000 6,000 26,773 1,474,859 327.75 118.00

In General Santos City, coco nuts are utilized in so many ways. Some of these nuts
are harvested as buko which is being supplied in the Public Market and other food
establishments in the city. Other farmers prefer not to harvest the nuts, instead, coconut
trees are utilized for coco toddy or coco sap production. However, the bulk of the produce
are processed into conventional copra. In addition, a lot of farmers are already aware
about the new trends in the market for coco nuts, that is, selling these nuts as whole nuts
which are further processed into several products such as coconut oil, desiccated coconut,
coco sap, and so many others.

The vast coconut production areas in the city call for the formulation of
interventions that would address and support various stakeholders at the different
segments of the value chain of coconut. Hence, the city is proposing for the engagement of a
qualified proponent group to engage in the processing and marketing of coco syrup.

Processing and Marketing of Coco Syrup

Members of the Sinawal Small Farmers’ Association have been engaged in the
processing and marketing of coco syrup on individual/household level in the past 3-5 years
already. They have seen this opportunity as an alternative livelihood to copra production.
As a proponent group, they would like to elevate their production operation to a higher

23 | P a g e
level. They are proposing to undertake the processing operation as a group to generate
more volume in order to capture a bigger market share.

The utilization of coconut trees for coco sap production to be processed into coco
syrup, which is further processed into coco sugar is an alternative livelihood for coconut
growers in the city. Consolidation of coco syrup of the Association will provide
opportunities for these farmers to market their product in bulk which could command
higher prices and other price incentives/premiums of their product due to the elimination
of middlemen in the marketing channel. In addition, it will facilitate farmers’ participation
from the production, processing, and marketing segments of the value chain.

The proposed enterprise can dispose its products in the local markets as seen below:

a. Suchero (The Churner Group, Inc.)

Suchero (TCGI) has been one of the trusted buyers of some member of the
association. Its processing plant is located at Brgy. Palian, Tupi, South Cotabato.
According to Suchero the capacity of their plant is 30 tons per month or they process
one thousand (1,000) kilos of coco sugar per day. They also have acquired some of their
coconut farmers with Organic Certification issued by a third party certifying body.

b. Free Foods

Free Foods is also one of the buyers of the members of the association. Their
plant is located at Toril, Davao City. Currently, we have no record of the plant’s capacity
to produced coco sugar, however, the members who are allocate their coco syrup
produce to Free Foods has a weekly target volume of 1,000 kilos per week. Since the
plant is located in Davao, the company picks-up the coco syrup from General Santos to
Davao.

c. GEES Organics

24 | P a g e
 GEES Organics is owned by Ms. Elvira Silva, former staff of PCA who taught the
members of the association and the community in the barangay to produce and process
coco sugar. The company is located at Prk. Pao-pao, Brgy. Sinawal where the association
is also located. The plant can process up to 25, 000 kilos of coco sugar monthly. Some of
the members of the association or their family also work in the plant as syrup makers,
tappers, packers or cleaners.

d. Local buyers

Coco syrup produced by the individual members are delivered to its identified
buyers, however, based on the quality standards set by the buyers, not all of the coco
syrup delivered are accepted. The rejected produced are considered “Class C” which is
not an export quality. These are then returned to the members of the association. The
“Class C” products are determined when the syrup cooked into coco sugar produces big
lumps. Nonetheless, the rejected products are still accepted in the local market. Local
buyers also patronize the Class C coco sugar since it sold in a much lesser price
compared to the Class A coco sugar.

Some members of the association have already existing contracts with the above
buyers. Members of the association with lower produce delivered their coco syrup to
members with more produce, so they can “ride-on” to the delivery. As of the moment,
the association and Suchero or the Churner Groups has already drafted a
partnership/supply contract. In the case of the other buyers, contract agreements are
yet to be crafted between the association and the company. Furthermore, the individual
members and the officers of the association headed by its president had also signed an
individual farmer’s commitment which laid down the agreements and obligation of
both the association and the individual farmer members.

There are also some producers of coco syrup such as Donnabelle Coconut Sugar
and Syrup located in Bansalan, Davao del Sur. The company is owned by Lao Integrated
Farms, Inc. which exports their products to the United States, Australia and some part
of Europe. Aroman Women’s Natural Food Producers Multipurpose Cooperative,

25 | P a g e
 located at Aroman, Carmen, North Cotabato are also producing coco sugar and other
coconut products.

Lao Integrated Farms, Inc., has an existing contract with some of the farmers
near Bansalan. This is to make sure that their current market demand especially their
export market demand will be met. On the other hand, it is unknown if the company
and Aroman Women’s Natural Food Producers Multipurpose Cooperative are sourcing
out their coco syrup on other areas aside from the coco syrup producers or farmers
near their area.

2. Business Overview

The Sinawal Small Farmers’ Association is newly-organized and registered as a

formal association. However, the members have long been grouped/organized informally
in the Barangay. Also, the members have long been engaged in the production of coco sap
and processing of coco syrup on an individual/household basis. In fact, the members have
existing contracts with the buyers of coco syrup in Barangay Sinawal of this city, Tupi in
South Cotabato and in Davao City.

The present funding opportunity has provided an avenue to the association to level
up its operation by engaging the business not as an individual but as a group. This is to
expand more production areas to be covered by the proposed project which in a way,
benefit more coconut farmers and other stakeholders in the industry such as the tappers,
syrup makers and other people in the community.

a. Processing of Coco Syrup

26 | P a g e
 The Sinawal Small Farmers’ Association is into processing of coco syrup since 2012.
Members of the association and other people of the community were trained by the
Philippine Coconut Authority staff on how the to process coco syrup and also how to
further process it into coco sugar. In fact, Ms. Elvira Silva, owner of GESS Organics, was one
of the PCA staff that trained the community in processing coco syrup and coco sugar to
provide them as an alternative source of livelihood. This through the PCA program KAANIB
or the Kasaganahan Sa Niyugan ay Kaunlaran ng Bayan which aims to promote coconut-
based farming system as a lucrative agribusiness venture which the community became
beneficiaries.

b. Marketing of Coco Syrup

Marketing for coco syrup is not a problem since demand for the product is relatively
high. That being said, the produce of the individual members of the association actually
cannot supply the demand of its market. One reason behind this is because not all members
of the association are engaged in coco syrup production. Some still choose production of
conventional copra since this is not labor intensive compared to production of coco syrup.

With this, the members of the association agreed to enroll a total of forty (40)
hectares of coconut trees for the production of the coco syrup for this proposed project.
Approximately, there are one hundred coconut trees in a hectare with 10x10 spacing. It is
expected that four thousand coconut trees will be tapped and used in the production of
coco syrup in the first three years of operation.

Specifically, the members of the association have a total coconut tree inventory of
11,330 trees which is equivalent to 113.30 hectares of land. However, the members has
only allocated a total of 80 hectares or is equivalent to 8,000 coconut trees where 40
hectares or 4,000 trees are currently being tapped and the additional 40 hectares or 4000
trees will be tapped on the fourth year of operation of the enterprise as previously
mentioned.

27 | P a g e
 As a matter of fact, the association and the individual members signed an
agreement which commits the individual farmer members to deliver all their produced
coco syrup to the association. In terms of the marketing agreement between the association
and the buyers, the Churner Groups or the Suchero and the association has also already
drafted a partnership/supply agreement. Based on the agreement, Suchero will be the
exclusive buyer of the syrup produced by the Association.

Processing of coco syrup will be done by the farmers and they will deliver it to the
makeshift warehouse of the association. To make sure that the coco syrup is of good
quality, cooking of coco sugar will be done for sampling purposes. The hauler truck to be
purchased will be used for the delivery of product considering that the association is
located on the upland barangay of the City. Delivery will be done on a weekly basis.

Below is the schematic diagram in the processing and marketing of coco syrup:

Figure 4: Process Flow of Coco Syrup Production

Collection of coco sap from the tree – every 6 hours (tappers)

Cooking of coco sap into coco syrup – 110 degree Celsius at lower
fire (tappers), this should be done after harvesting

Delivery of coco syrup to the association (tappers/owners) - once a

week

Consolidation of coco syrup (Association) upon receipt from the

members

Consolidated coco syrup will be delivered to the target customers

(Association) - once a week

As of the moment the association has an existing forty (40) hectares planted with
productive coconut trees which is around four thousand coconut trees. These trees are
being tapped and are the source of coconut sap, these are then processed into coco syrup or
coco sugar. Fortunately, individual members of the association also have another forty

28 | P a g e
(40) hectares planted with coconut which also have additional four thousand trees. The
members agreed to include this as potential expansion area and will be productive in the
next three (3) years of enterprise operation. Hence, there will be a total of eight thousand
coconut trees to be tapped after the first three years of operation of the enterprise.

A coconut tree can produce as low as 47 liters of coco sap and as high as 100 liters
per day. Assuming a hectare of coconut can produce 224 liters of sap per day it is expected
that in a year it can produce 13,626.67 liters of coco syrup which is equivalent to 11,923.33
kilograms of coco sugar. Based on the current buying price coco sugar which is Php. 85.00
per kilogram, a hectare can generate up to Php. 1,013,483.33 gross income.

Although, coco syrup is the final product of the Association, it is being paid based on
the volume of the coco sugar that will be derived from the coco syrup delivered.

With favorable weather condition and based on the association’s production of

coconut sap, it is expected that from year one to year three of the enterprise operation, 5%
of the beneficiaries’ income will increase. On year four, since it is expected that the 40
hectares expansion area will be productive, it will have a 25% increase in farmer’s income.
For year five to year seven, 5% increase in income will be expected; this is because the
newly productive coconut is still not producing much compared to the much older coconut
trees. For year eight to year ten, 10% increase in income will be expected. As the coconut
trees got older the production of coconut sap also increases, hence, increase in income is
probable.

It is also likely that job generation will increase especially on year four of the
enterprise operation due to the production of the additional 40 hectares as mentioned
earlier. Basically, in a hectare there are four (4) tappers assigned in the area. Most of the
time, the tappers are the ones who also do the cooking or the processing of the coco sap
into coco syrup by open pan evaporation cooking. Sometime the tapper’s wife will do the
cooking of the coconut sap into syrup while their husband rests. With that being said, the
enterprise will need to double its number of workers when the potential area will start to
produce.

29 | P a g e
 According to Asian Journal (SF January 30, 2015 SF Magazine pg.2), as the demand for
alternative source of low glycemic index food products increases due to high incidence of
diabetes especially abroad and also in the local scene, it is also expected that demands for
coconut sugar based products will also increase and since coco syrup is the main raw
ingredients of these products, it is projected that demand for this will also rise.

3. Products and Services

The product to be produced by the proposed business enterprise will be the Coco
Syrup.
Coco syrup is made from the coco sap which contains 80% water. The sap undergoes a
natural process of evaporation until it becomes a “toddy” or syrup-like substance. One
hundred percentage (100%) of the farmers produce is marketed as coco syrup.
The main product produced by coco syrup is coco sugar. Based on the test done by the
Food and Nutrition Research Institute and Department of Science and Technology of the
Philippines in 2007 revealed that coco sugar has low glycemic index (GI) of 35 and coco
syrup with 39 compared to that of cane sugar’s GI of 50. The GI is a ranking system for
carbohydrates based on the immediate effect on blood glucose levels. Low GI food is good
for proper of diabetes mellitus, reducing bad cholesterol, and for weight maintenance.
Comparative chemical analysis shown in the table below also revealed that coco sugar
contains higher amounts of nutrients such as nitrogen, phosphorous, potassium,
magnesium, chloride, zinc and iron compared to brown cane sugar. To top the export
market however, there is a need to secure organic certification for the products.

Figure: 5 Comparative Analysis of Coco sugar and Brown Sugar

30 | P a g e
 The major component of coconut sugar is sucrose (70-79%) followed by glucose
and fructose (3-9%) each.  Minor variations will occur, due to differences in primary
processing, raw material source, tree age and variety of coconut.

Coconut palm nectar has a nutritional content far richer than all other commercially
available sweeteners. It is especially high in Potassium, Magnesium, Zinc and Iron (similar
to coconut water) and is a natural source of the vitamins B1, B2, B3, B6 and C.  It’s also very
rich in other minerals and enzymes which aid in the slow absorption into the bloodstream.

Glycemic Index takes into account the quality of the carbohydrate in a food and
ignores its quantity.  A glycemic index value therefore tells us only how rapidly a particular
carbohydrate turns into sugar.  It doesn’t tell how much of that carbohydrate is in a serving
of a particular food.  Both the things are important to understand a food’s effect on blood
sugar. While Glycemic load is used to consider the quality and the quantity of carbohydrate
content of the foods.

31 | P a g e
 Foods that have a low glycemic index invariably have a low glycemic load, while foods
with an intermediate or high glycemic index range from very low to very high glycemic
load.  Therefore, you can reduce the glycemic load of your diet by limiting foods that have
both a high glycemic index and high carbohydrate content. Basically glycemic index is
considered low if it is equal to or lesser than 55. While it is considered moderate or
medium if its GI is equal to 56 up to 69. But if the GI is equal to 70 or more it is considered
as high.
Production of coco syrup has been the main source of income of the farmers in the area.
With additional utensils that will be provided by the proposed project, more volume and
improved quality of coco syrup produce is expected.

Role of the Enterprise in the Value Chain Upgrading

The Processing and Marketing of Coco Syrup Subproject is one of the segments
within the value chain for coco sugar. The coco syrup is an intermediate product derived
from coco sap. The coco syrup will further be processed into coco sugar.

Coco syrup can be processed into coco sugar and other coco syrup-based food
products which have high potential both in the local and international markets.

Coconut is the top priority commodity of the City of General Santos. The processing
and marketing of coco syrup is one of the alternative business opportunities aside from
copra making that our coconut farmers can take advantage of in the City of General Santos.

II. MARKET ANALYSIS

1. Market Characteristics

The Philippines is one of the world's largest producers of coconut products. About
twenty-five percent (25%) of cultivated land were planted with coconut trees and it is
estimated that between twenty-five percent (25%) and thirty-three percent (33%) of the
population was at least partly dependent on coconuts for their livelihood.

32 | P a g e
 General Santos City accounts for 4.43 % of the Region’s coconut production. Table 1
reflects the 2012 coconut statistics of Region XII in which General Santos City has coconut
area of 9,042.23 hectares. The bearing trees of 794,811 toiled by 1,086 farmers produce an
annual nut production of 56,431,568 translated into 14,107.89 metric tons in copra terms.
Table 2 presents the PCA data for the Total Land Area and Cocal Area of Sarangani Province
and General Santos City for 2013 of which 9,530.32 ha. of coconut area comes from General
Santos City with 850,234 bearing trees.

Table 4: 2012 Coconut Statistics of Region XII

Trends and outlook

In terms of Global production the top three producers of coco nuts from 2010 to
2014 are Indonesia with an average of 18,460,426.00 tons, Philippines with 15,333,351.60

33 | P a g e
tons and India with 10,937,774.60 tons. The coconut industry is the highest net foreign
exchange earner of agricultural exports in the Philippines, accounting for about 1.5%
of GNP. It employs, directly or indirectly, some 20 million people (about one-third of the
population) and earns more than US$510m annually.

Figure 6 : Top 3 Producers of Coconuts (Tons)

Top 3 Producers of Coconut (Tons)

25,000,000.00

20,000,000.00
India
15,000,000.00 Indonesia
Philippines
10,000,000.00

5,000,000.00

-
2010 2011 2012 2013 2014






34 | P a g e
 Based on the data presented during the Philippine Coconut Authority Roadmap of
2012 at Davao City, the leading coconut sap sugar exporter nations are the Philippines with
52% or equal to 220 metric tons, Indonesia with 24%, Thailand, United States of America,
Australia and Singapore. Figure 7 shows the distribution of coconut sap sugar in the export
market.

Coconut shares 21% of our total annual export earnings being our premier
agricultural dollar-earning export industry. Coco sugar, the processed product of coco
syrup is considered as one of the product that has potential as product winner terms of
export earnings. In 2012 the country’s export for coco sap sugar has a global export share
of 52% which is about 220 metric tons followed by Indonesia with 24 %.

Export market for coco sap sugar are usually supplied in the United States, Canada,
Norway, France, Australia, New Zealand, South Korea and Japan to name a few. About 80%
of the country’s coconut produced while the remaining 20% is locally consumed.

Figure 7: Distribution of Coconut Sap sugar in the export market.

Singapore
USA Australia 3%
5% 3%
Thailand
13%
Philippines
52%

Indonesia
24%

35 | P a g e
 Among the top 6 producers of coco sap sugar in the world, Philippines have fourteen
(14) manufacturers, five (5) traders and one (1) distributor. Indonesia has four (4)
manufacturers and five (5) traders, while Thailand has five (5) manufacturers. On the other
hand, Australia and Singapore have both one (1) distributor, while the United States has
two (2) distributors.

In Mindanao, there are 9 exporters of coco sugar. Linabo Agrarian Multipurpose

Cooperative, located in Nortthern Mindanao, who exports to Japan and some parts of
Europe. They supplies United Kingdom with 5 metric tons of coco sugar per month. In
Davao region, there are four (4) companies, namely: Hijo Resources Corporation who
exports to Australia and to United States; Healthy Sweets who exports to Estonia and
Japan; Lao Integrated Farms who sells coco syrup to United States; and St.
Jude/Compostela who is having an ongoing negotiation with buyers in Japan. TreeLife Coco
Sugar is located in SOCSKSARGEN, they are exporting coco sugar in Holland, United
Kingdom, Australia and New Zealand. The Churner Group Incorporated, also located in
SOCSKSARGEN, sells their products to United States and some parts of Europe. While there
are two companies located in CARAGA, the Buena Palma Corporation who is currently
negotiating with Japanese buyers and the Celebes Corporation who exports in Europe and
United States.

According to the Philippine Coconut Authority, the Philippines have a total of 3.502
Million hectares of land planted with coconut in 2013 which is equivalent to 26% of the
total agricultural land. Out of the 81 provinces, 68 of these are coconut areas with 1,195
coconut municipalities.

Approximately, the country has about 330 million bearing coconut trees which
produces an average of 15.207 billion nuts annually. The average production of nuts per
tree in the country annually is about 44 nuts.

According to statistics, 48% of the total area planted with coconut is in Mindanao
which is equivalent to 1,595,120 hectares. Nuts produced of the said area in Mindanao are
about 56% of the country’s total production or about 8.1 Million Tons annually.

36 | P a g e
 With the increasing domestic and export demand, the coconut sap sugar industry
presents a promising business opportunity for the farmers and the small to medium
enterprises. The increase in demand could be related to the high prevalence of diabetics
and the growing interest of health enthusiasts locally and worldwide. In 2012, about eighty
six percent (86%) of coco sugar producers in the Philippines come from Mindanao.
Northern Mindanao contributes 32% of the total national production or is accounted as the
highest production share of 108 metric tons followed by SOCCSKASARGEN and Davao
Region. Figure 8 shows the market share of Philippine regions that produces coconut sap
sugar.

Figure 8: Market share of Philippine regions that produces coconut sap sugar.

Coconut Sap Sugar Producers in the Country per Region

Region VI Region IX
Bicol 3% 3%
5%
Region IV A Region XII
3% 21%
Region IV B
3%

Davao Region
19%
Region X
32%

CARAGA
11%

37 | P a g e
2. Target Customer Profile
Philippines is among the top producers of coconut in the world. In fact,
according to the data generated by the Food and Agriculture Organization of the
United Nations Statistics, that in 2012 the Philippines ranked number one in terms
of land area with 3,573,806 hectares followed by Indonesia with 3 million and India
with 2.1 million. Figure 9 shows the top 10 countries in the world with coconut
harvested area from 2011 to 2013.

Figure 9. Top 10 countries with coconut areas harvested .

38 | P a g e
 However, in terms of production, Indonesia is the top coconut producing country
with 18M metric tons while the Philippines only ranks second with 15,862,386 million
metric tons. India is the third largest coconut producer with 10,560,000 million metric
tons.

Coconut shares 21% of our total annual export earnings being our premier
agricultural dollar-earning export industry. Coco sugar, the processed product of coco
syrup is considered as one of the product that has potential as product winner terms of
export earnings. In 2012 the country’s export for coco sap sugar has a global export share
of 52% which is about 220 metric tons followed by Indonesia with 24 %.

Export market for coco sap sugar are usually supplied in the United States, Canada,
Norway, France, Australia, New Zealand, South Korea and Japan to name a few. About 80%
of the country’s coconut produced while the remaining 20% is locally consumed.

3. Supply and Demand Analysis

39 | P a g e
 Currently, members of the association are delivering their produce to their
individual buyers but members have already enrolled forty (40) hectares coconut for the
proposed enterprise. Based on their currently production, an average of 83 liters of coco
syrup can be produced in one (1) hectare of coconut which could produce an average of 20
kilos coco sugar. If the association will be managing the 40 hectares coconut land, it is
assumed that 3,345.2 liters of coco syrup or 800 kilos of coco sugar will be produced daily.

Presently, Suchero and Free foods each have a target volume form the individual
members is 1,000 liters of coco sugar per week. While GEES Organics, does not have a
target volume demand for the association. However, during one of the consultation
meeting, representative from Suchero mentioned that they are willing to accept or buy
more volume of coco syrup since they are not only producing coco sugar but also some
other products which uses coco syrup as the raw material such as coco honey and coco jam
to mention a few.

III. COMPETITOR ASSESSMENT

1. Current Market Share

There is no known competitor or supplier of coco syrup in the area since most of
them are actually small. For instance, there are coco syrup producers in Brgy. Upper Labay
with only around 50 to 100 trees are tapped. According to them they deliver their
produced to GEES Organics, however there supply is not stable or they do not deliver on
regular basis. They are also paid in cash by the buyers with the same buying price of Php
85.00 per kilo of coco sugar. This is because, coco syrup producers are being paid not on
the volume of coco syrup delivered but on the volume of coco sugar derived from the coco
syrup.
Base on the current volume demand of the Suchero to association, its monthly
market share is thirty three percent (33%). However, the association has no data as to the
actual market share based on the total demand of coco syrup of Free Foods as well as the
total market share of GEES Organics.

40 | P a g e
 It is known for the fact that Region XII is the second producer of coco sugar in the
country. With this, alternative market will not be a problem since export and local demand
for coco sugar are increasing. Also, GEES Organics has a plant capacity of twenty five tons
(25T) per month. The company is currently constructing another plant for expansion. This
will serve as alternative market since the members of the association has no existing
contract with the said company.
Like the individual members of the Sinawal Small Farmers Association, other
suppliers of Suchero also delivered their coco syrup directly to the processing plant. Other
suppliers are also paid on cash on delivery basis with Php 85.00 per kilo for the first 500
kilos. However, we do not have data on the volume of coco syrup being delivered to
Suchero by other suppliers since they are usually individual farmers in the neighboring
areas such as Tupi, Polomolok, Tampakan and Koronadal City.
In the part of Suchero, to ensure stable supply of coco syrup, they have suppliers
who delivered their product regularly which we could consider as “suki” like in the case of
the members of the SSFA.

Table 5. Competitors’ market share

Competitors Buying Price % Share of market Relationship with Average volume

(PhP) customers procured per month

Individual P 85.00/ kilo of No data Direct No data

Farmers coco sugar

2. Relationship with Customers

Forging a marketing agreement or contract is important in the proposed enterprise
to ensure market of the product. As of the moment the association itself has already crafted
a marketing agreement with the Churner Groups or the Suchero, this is to ensure, on one-
way or another, the sustainability of the project. However, with regards to the other buyers
forging of marketing agreements are still on process. Based on the initial talk with the

41 | P a g e
buyers, they are more than willing to forge a marketing contract to the association to
ensure supply of coco syrup.
On the part of the SSFA, to ensure the stable supply of coco syrup to their buyers,
they also forged a commitment agreement between the association and its individual
members who have an existing coconut to be tapped, where the members have agreed to
delivered all their coco syrup to the association.

Table 6. List of Buyers of Coco Syrup

SSFA List of Buyers of Coco Syrup

Behaviors Suchero GEES Organics Free Foods

Geographical Export & Local Export & Local Export & Local
Market

Geographical Tupi, So. Cot Sinawal, GSC Toril, DVO

Location

Channel Direct Direct Direct

Payment COD COD COD

Quality Sampling Sampling Sampling

requirement

Purchase P85.00, based on P85.00, based on P85.00, based on current

behavior current market price current market price market price

Operation Delivered (Weekly) Delivered Pick-up (if land is

company rented)
(Weekly)

3. Price, Distribution, Product/Service Features

Buying price for coco syrup is based on the recovery rate of coco sugar. Usually four
(4) liters of coco syrup produces one (1) kilo of coco sugar. The current market price is

42 | P a g e
₱85.00 per kilo of coco sugar but as the volume of coco sugar increases, the price per
kilogram also increases as reflected in the partnership/supply agreement, to wit:

Kgs of sugar (derived from coco syrup) Price/kg

0-500 85.00
501-1500 85.00 for the ist 500 kgs and 90.00 in excess
of 500 kgs
1501 and up 85.00 for the ist 500 kgs, 90.00 in excess of
500 kgs up 1000kgs and 95.00 in excess of
1500 kgs

The association is paid by the buyers immediately upon delivery. The coco syrup
will be delivered weekly. Truck requested by the association will be used for this purpose.

4. Financial Strength/Cost Position

Locally, there is no known organized group who are producing coco syrup in the
city other than the Sinawal Small Farmers’ Association. The members of the association
have their individual marketing agreements with Suchero and Free Foods especially the
members who have bigger production. Those farmer-members who have smaller
production delivered their produced to GEES Organics which is operating in the locality.
However, these individual contracts will cease once the newly-crafted contract
between the association an Suchero will commence. Hence, members of the association
will not be marketing their products on an individual basis but as an association.
The existing market of the association is accepting coco syrup from various
sources within Region 11 and Region 12. But according to one of the representative of
Suchero, they prefer the coco syrup produced by the Sinawal Small Farmers’
Association because of the quality coco sap sugar it produces.
Since the members of Sinawal Small Farmers’ Association have been in the
business of producing coco syrup in the past 3-5 years already, it is assumed that

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 already knew the ins and outs of the business specifically the financial aspect. It is also
assumed that they have enough capital to finance the farm and processing activities.

5. Length of Time in Business

As individual farmers, the members started coco syrup production 3-5 years ago,
but they are registered as an association on the first quarter of 2016. The members of the
association play a vital part in the production of coco syrup for members are composed of
tappers, syrup makers, farmers and land owners.

With their experience, it is assumed that already knew the ins and outs of the
business.

IV. MARKETING PLAN

1. Product

Coco syrup is the product form derived from cooking the fresh coco toddy in a low
fire or by simply removing its moisture content, this process is called the traditional
method or the open pan evaporation. It must be noted that once the coco toddy is collected,
it has to be processed as soon as possible to avoid fermentation. The evaporating process
itself needs to be precisely controlled to avoid caramel formation.

Compared with the common cane sugar, the production process of coconut syrup is
more minimally processed. Also, coco syrup processing is free from bleaching agent and
preservatives. The liquid is so thick that almost no microorganisms could be live there.
Many coconut by-products are produced using coco syrup as its main ingredient such as
coco sugar, coco honey, coco jam and many more.

44 | P a g e
 There are at least two reasons why coco syrup or coco sugar is a good replacement
to common sugar. First, it low glycemix index and its nutrient content. The glycemic index
is a numerical value to represent how fast a certain carbohydrates turns into sugar.

Based on the study by Dr. Trinidad P. Trinadad, Scientist II of the Department of

Science and Technology, coco syrup has a glycemic index of 39 which is considered low.
Although coco syrup has a low glycemic index, once processed into coco sugar its glycemic
index could still be lower up to 35.

Coco syrup is also very nutritious for it contains vitamin B complex, vitamin C,
amino acids as well as minerals. Compared to some sweeteners coco syrup has much
nutrients compared to other sweeteners making it more nutritious.

According to a study conducted by the University of Sydney in Australia showed that

consuming low glycemic index food will help us avoiding chronic diseases, such as type-2-
diabetes. Coco Syrup/Sugar is also good for people with obesity. Besides its health benefits
coco syrup/sugar has a delicious unique caramel taste that can enhance the flavour of
drinks or foods.

Table 7. Nutritional comparison of popular sweeteners.

Macro-nutrients Coconut Agave Honey Maple Brown Refined,

(mg / 100gm) Palm Syrup Syrup Sugar White
Sugar Sugar
Nitrogen (N) 202 NA NA NA 10 0
Phosphorus (P) 79 7 4 2 3 0
Potassium  (K) 1,030 1 52 234 65 2.5
Calcium (Ca) 8 1.5 6 67 24 6
Magnesium (Mg) 29 1 2 14 7 1
Sodium (Na) 45 1 4 9 2 1
Chloride (Cl) 470 NA NA NA 16 10
Sulfur (S) 26 NA NA NA 13 2
Boron (B) 0.6 NA NA NA 0
Zinc (Zn) 2 0.2 0.2 4.2 .2 0.1
Manganese (Mn) 0.1 0.1 0.1 3.3 .2 0
Iron (Fe) 2 1 0.4 1.2 1.26 0.1
Copper (Cu) 0.23 0.1 0 0.1 0 0

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Thiamine 0.41 0 0 0 0 0
Vitamin C 23.4 0.5 0.5 0 0 0

Provision of additional utensils and materials needed for the production of coco
syrup will surely help the association since representative from Suchero already said that
they prefer the coco syrup produced by the association for its quality. To ensure quality of
produced, sample cooking of coco sugar will be done to every stock delivered.

The target volume of production once the enterprise will be operational will be an
average of 56,777.77 kilos of coco syrup or is equivalent of 681,333.33 per annum for the
40 hectares coconut that will be tapped. Since the additional expansion area will be
productive on the third year of the enterprise operation, it is expected that production will
increase to 131,454.75 kilos monthly or up to 1,577,457 kilos per year.

Technicians and representatives of the buyers also visit the coconut farms of the
members to monitor and the area. This will also ensure the buyers that the coconut trees
are of good health and can produce premium quality coco sugar.

As specified in the Partnership/Supply Agreement, coco syrup produced must be

packed in food-grade containers with led and proper label. These containers can be
sourced-out from the company itself.

The product should also conform to the following physical characteristics:

Parameters Quality Characteristics

Color Light yellow/cream to dark brown
Odor Sweet scent; pleasant nutty aroma
Taste Sweet
Others Free from filth and other extraneous
matters

2. Pricing strategies

The association is being paid not on the volume of coco syrup delivered but on the
volume of coco sugar derived from the coco syrup. The current market price is ₱85.00 per

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kilo of coco sugar but as the volume of coco sugar increases, the price per kilogram also
increases as reflected in the partnership/supply agreement, to wit:

Kilograms of Coco sugar Price/kg

(derived from coco syrup)
0 kgs- 500 kgs Php 85.00
501 kgs- 1,500 kgs Php 85.00 for the 1st 500 kilograms and Php
90.00 in excess of 500 kilograms
1,501 kgs and up Php 85.00 for the 1st 500 kilograms, Php
90.00 in excess of 500 kilograms up 1,500
kilograms and Php 95.00 in excess of 1,500
kilograms

Buyers pay their supplier on a cash-to-cash basis immediately upon delivery.

As mentioned above, price for coco syrup increases as the volume supply also
increases, this will be the pricing strategy of the association. With forty hectares (40)
coconut farm, the association projected to produce eight hundred kilos (800) of coco sugar
daily which surpasses their current supply to the market as individual producers. Bigger
volume of production as a result of their consolidation strategy will enable the Association
to be in a better position to negotiate for higher prices with the buyers. And since coco
syrup is the raw materials of many products which are sold locally and some are exported,
demand for it will eventually increase in the years to come. Hence, it is expected that prices
will also follow an upward trend.

3. Place /Channel of Distribution

The proposed enterprise will disposed its products Suchero or The Churner Group,
Incorporated (TCGI). It will be the exclusive buyer of the product as provided in the
Marketing Agreement.

Suchero is owned by The Churner Group. The company started in 2005 when three
of the major stocksholders’ paths crossed while they were involved in the production of

47 | P a g e
their own brands of Virgin Coconut Oil. They decided to put their resources, expertise and
strengths together, and with their passion to provide healthier alternatives for the
Filipinos, and the world, led to the birth of an all-natural low GI sweetener.

Suchero was established in May 2008, when the Churner Group started to be
involved in the production, packaging, distribution, marketing and sales of coco sugar.
Suchero’s principal office is at Richville Corporate Tower located at Madrigal Business
Park, Muntinlupa City.

The company also put consideration on the Research, Development and Quality
Control. The company is very meticulous from the selection of coconut trees until the final
packaging of the product to make sure that they could deliver 100% all natural sweetener
that will meet the highest international standards.

Suchero has been one of the trusted buyers of some member of the association. Its
plant is located at Brgy. Palian, Tupi, South Cotabato. The company buys the raw coco
syrup from its supplier and the payment for it will be based depending on the voume of
coco sugar from coco syrup.

According to the representative of Suchero, the capacity of their plant is thirty (30)
tons per month or they process one thousand (1,000) kilos of coco sugar per day. They also
have acquired some of their coconut farmers with Organic Certification issued by a third
party certifying body.

Portion of the Suchero’s produce are being sold to the international market, but
currently we do not have data on the exact volume of products sold locally and exported.

One (1) unit delivery truck will be procured to facilitate hauling and delivery of the
coco syrup to the identified buyer.

4. Promotion

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 The association has no special promotion for their product, but they have developed
good relationship with their buyers. They also make sure that their product is of good
quality and are delivered on time. As evidence of a good supplier-buyer relationship,
buyers have secured certificates for the coconut farms to be certified “organic” issued by a
third party certifying body. Organic certification is a form of promotion of the product the
Association is producing.

V. OPERATIONAL PLAN

1. Ownership & Management

Ownership

The business enterprise will be owned and managed by the Sinawal Small Farmers’
Association, which is the lead proponent of the enterprise. The SSFA has 84 members
which include farmers, tappers and laborers. They have a total land area of eighty (80)
hectares devoted to coco syrup production where forty (40) hectares 50% are
productive. The remaining forty (40) hectares are allocated for the expansion which is
due to produce coco sap within the next 2 to 5 years.

The SSFA was only registered as an association last February 2016. However, its
members have already been engaged into coco sugar processing since 2012. Individual
members of the association have been marketing their products to their individual
identified buyers. But since individual member cannot ask for assistance to institutions
that could help them develop further their product such as the Department of
Agriculture, they have decided to form an association.

Management

The association will be the one to manage the enterprise, however, due to some
qualification requirement the association will hire additional staff such as bookkeeper

49 | P a g e
 and auditor to ensure proper recording of accounts. A core group will also be created to
solely oversee the operation of the enterprise. Below is the Organizational Structure of
the Association.

Figure 10 : Association Organizational Structure

President PRDP, CLGU,

Grievance Point Other
Person Stakeholders

Secretary Vice President

Auditor Treasurer

PIO Bookkeeper

Monitoring / Audit & Membership/

Education
Evaluation Inventory Credit Screening
Committee
Committee Committee Committee

Operation Manager

The business operation will be led by the Operation Manager. He/she will be the
one to oversee the whole operation. He/she will directly report the status of the operation
to the President. Directly under him/her is the Operation In-charge who will directly
supervise the various activities from coco sap harvesting to syrup processing, consolidation
and eventually marketing.

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 There will be at least 4 tappers per hectare of coconut who will be in-charged in
tapping more or less 25 trees on a daily basis. Tapping is done 24 hours a day on a 4-6
hours interval. The syrup makers/cooks will follow the same interval since they have to
immediately cook the sap after harvest to preserve its quality. The farmers will be one in-
charge in the maintenance of their own farms.
In the consolidation aspect of the operation, 2 laborers will be in-charged in the
various activities involved in the process of consolidating the syrup produced by the
farmers. Such activities include hauling and trucking. Below is the Operational Structure of
the proposed business enterprise.

Figure 11: Project Operational Structure

Stakeholders: PRDP, CLGU, PCA, DTI, Operation Manager

DENR, DA, NGOs and other
Steering Committee –
Cluster Representative
Admin & Finance
Dept.
CAO Technician

1 Bookkeeper Cashier Auditor

Operation’s In-charge

Production of Coco Consolidation of Coco

Trading/Marketing
syrup syrup

160 Tappers/Cooks/ 2 Hauling Laborers 2 Hauling Labors

farmers

1 Truck Drivers

Further, the roles of the various partners who can provide the necessary technical support
in the implementation of the enterprise cannot be overemphasized. For one, the Philippine

51 | P a g e
Coconut Authority (PCA) has a very vital role as an oversight in the production aspect of
the business operation.

More importantly, the Department of Agriculture and the PRDP can both offer
technical assistance to the business operation, aside from providing the fund for the
project. Lastly, the Local Government Unit of General Santos is a very important key player
in the implementation of the project as it provides not only the necessary counterpart but
also the key implementer of the proposed project.

Staffing qualifications and responsibilities

Qualifications, responsibilities and functions of each personnel will be defined
clearly. They shall be trained and capacitated on their assigned tasks and functions in the
whole process, from production activities down to the processing as well as the operation.

Table 8: Staffing qualification and responsibilities

Position Qualifications Responsibilities/ Functions

Must have an experience on Will manage all the business

1. Operations Manager
the operations of the lines and operations of the
(1)
enterprise enterprise

Keep, maintain, update and

preserve all books of accounts,
subsidiary ledgers documents,
Must be knowledgeable in
vouchers, contracts and other
accounting and bookkeeping
records concerning the
2. Bookkeeper (1) at least (2) years’ experience
business of the association
in association or related
and make them available for
business
auditing purposes to the
chairman of the Audit
Committee

3. Cashier (1) Must be knowledgeable in Responsible for the daily cash

accounting and bookkeeping receipts and disbursements.
and must have at least two Ensure that all cash

52 | P a g e

years’ experience in
association or related
business.
transactions are properly
documented according to the
associations policy, system
and procedure on recording
business transactions

In-charge of external audit of

4. Auditor (1) the books of accounts of the
association.

Will be responsible for the

Has at least 1 year experience hauling of the products (2 will
5. Utility/ Laborers (4)
in association business be assigned in the marketing
and 2 in the warehouse )

Responsible for the hauling

Must be an experience truck
7. Driver (1) and delivery of the coco syrup
driver for at least 10 years
to the identified market.

2. Resources and Production

The Association should adhere to the technical specifications set by the buyer
(which is based on the Phil. National Standards for Coco Sugar), specifcally relative to the
care and maintenance in the farms as well as the harvesting practices as provided in the
marketing contract. In terms of farm management, the following should be observed: 1)
the farm must be neat and clean; 2) each tree must be labeled and coded; 3) production
data must be recorded to included all treatments such as fertilization and other farm
activities; and 4) water in the farm must be pure and clean.

In addition, the farm should also be certified as organic to also comply with the
requirements of the buyers of Suchero in the export market. Cost of Organic certification is
borne by Suchero.

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 Currently the association has a total of 80 hectares cocal area where 40 hectares are
productive which is devoted to coco syrup production. Forty (40) land owner members of
the association have manifested their intention to enroll 1 hectare each of their cocal area
to the projects. The remaining 40 hectares is allocated as an expansion area for it will be
due to be productive with 2-5 years.

It is also specified in the marketing agreement to observe the following in

harvesting coco sap: 1)coco sap must nit be contaminated; 2) harvesting must be done by
qualified sap tapper; 3) the knife or scythe must be washed thoroughly, rinsed in boiling
water and kept clean; 4) ladder must be used as necessary; 5)sap harvested must have the
following physical and chemical characteristics:

Parameters Characteristics
Color Beige to light brown/amber
Brix 13-14.5
Ph >=6
Clearness Translucent to clear

Initially, the coco nut tree blossoms are tapped with the use of sickle, for the
collection of its sap which resembles the practice of tapping maple trees for maple syrup.
Plastic containers or containers that are made of hallow bamboo tubes are used to collect
the sap. The freshly gathered sap is oyster white in color and has a nearly neutral pH.

Collection of fresh coco sap is done four times a day regularly. This has been the
practice of the members of the association in the previous years. This is to make sure that
the sap collected has not been fermented for it will lessen the quality of the coco syrup and
coco sugar to be produced. Usually, the harvest time is every four to six hours. Harvesting
will start at 4am, then 9 am, third harvest will be 2 in the afternoon and 6 or 7 in the
evening.

Tappers are fellow members of the association and other residents in the area of
operation. Also, tappers can also be sourced-out from the neighboring barangays in the
city.

54 | P a g e
 There are two methods on processing the toddy into coco syrup or into sugar. The
most popular process is the traditional method or the open pan evaporation. Basically the
concept of this process is to slowly dehydrate or evaporate the water content in the fresh
coconut sap to concentrate it so it will become syrup through the traditional open pan
evaporation. This is the process that the SSFA are using in processing their syrup.

The second method is the modern method or the Vacuum evaporation. In this
method the coconut sap undergoes low heat around 40 ̊C to 42 ̊C in a vacuum evaporator
which produces raw coconut syrup. The fresh coconut sap is placed in bottles during this
process. This method is usually done by large corporations or companies that are
financially capable in purchasing expensive equipment for their operations.

After every harvest, it will be cooked immediately in a low fire for about thirty
minutes. Every now and then, the coco sap will be stir with a ladle. Bubbles formed will be
sieve for this will cause contamination of the product. The end product of this process will
be the coco syrup. Free foods, one of the buyers of the association of coco syrup, built a
cooking area for some of the members of the association who supplies coco syrup for them.

The cooked coco syrup will be placed in a stainless container for cooling. After coco
syrup has cooled, it will be transferred to a food grade container for storage and is ready
for delivery to the association’s clients.

The land owner/ farmer/ tappers will be in-charge of the tapping and collection of
sap, cooking of sap into coco syrup. The association will be the one who will consolidate
and market the produce coco syrup to the identified markets. Figure 10 shows the
production process flow, while figure 11 shows the detailed process flow with the
responsible staff.

Figure 12: Production process flow

55 | P a g e
 Collection of coco sap from the tree – every 6 hours (tappers)

Cooking of coco sap into coco syrup – 110 degree Celsius at lower
fire (tappers), this should be done after harvesting

Delivery of coco syrup to the association (tappers/owners) - once a

week

Consolidation of coco syrup (Association) upon receipt from the

members

Consolidated coco syrup will be delivered to the target customers

(Association) - once a week

Table 9 : Detailed Process Flow with staff responsible

Input
Responsible
Process step Description Location Requiremen Output
Staff
t

Tappers will
collect the sap
from the Farm/
1. Collection Coco Coco
coconut trees coconut Tappers
of sap sap/toddy sap
every 6 hours area
(4 harvest time
a day)

2. Cooking of Tappers will Cooking Coco sap Coco Tappers/ cooks

collected sap immediately area syrup
into syrup cooked the
harvested sap
at 110 degrees
Celsius in low
fire for 30
minutes or until
the desired
consistency is

56 | P a g e
 achieved

3. Delivery of
Tappers/owner
coco syrup Associatio
s will deliver
to the n Coco Tappers/owner
the coco syrup Coco syrup
association receiving syrup s (farmers)
to the
as area
association
consolidator

The association
4. will consolidate Associatio
Consolidatio all the coco n Coco
Coco syrup Association
n of coco syrup produce receiving syrup
syrup by their area
member

Coco
The
sugar
consolidated
(price
coco syrup will
will
5. Delivery of then be
depend
consolidated delivered to the Associatio
on the
coco syrup identified n to the
Coco syrup recover Association
to the market identified
y of
identified depending on buyers
coco
market the volume and
syrup
frequency
into
requirement of
coco
the buyer
sugar)

It is shown in Table 9 the detailed process flow with the staff responsible on the
specific operation of the enterprise from the collection of sap up to the delivery of
consolidated coco syrup to the identified buyers. Collection of sap and cooking are of the
most crucial part of the enterprise operation process because it will define the quality of
the finish product.

In cooking of the syrup, farmers or their wives who do the cooking used qualitative
standards in assessing the final product which was set by the buyers. This when the

57 | P a g e
product has the right consistency, textured and color, thus the quantitative standards or
the use of thermometer was not observed or used.

Facilities and Equipment

Like any other enterprises, the association needs tools that will help them in
producing coco syrup. Table 10 is the list of materials needed by the association. Sickle is
used in tapping the coconut blossom so we could harvest the coco toddy. Sanggab is the
container used to collect the toddy. Sanggab is usually made of plastic while the traditional
sanggab is made from bamboo. Packing tape and plastic twine is used to secure the sanggab
in place.
Wok and ladle will be used in cooking the toddy into coco syrup. While the stainless
basin and bucket will be used as temporary containers when the coco syrup is still in the
cooling process. Stainless strainers are will be used to remove the bubbles formed during
cooking. Cooked and cooled coco syrup will be placed in a food grade plastic container.
Other materials like tables and weighing scale will be placed in the makeshift
warehouse. The truck will be used to deliver the coco syrup to the identified buyers. As
mentioned previously, to ensure quality, sample cooking of coco sugar will done, hence,
LPG, burners, trays, dryer and strainers are also needed in the operation of the enterprise.
Members have traditional cooking area located in the coconut areas. Since the
association will be consolidating their members’ produced, they have included the
construction of a consolidation area where they will use as an office and storage area of
their product. All the cost to be incurred for the construction of the building will be
shouldered by the association.
The building will be approximately 65.7 square meters which will be made of
concrete. The proposed building will have three (3) rooms, one will be used as a storage
room for coco syrup, one will be used as an office and other one will be used as a stock
room for materials. The building will also have a cooking area where they can do sample
cooking of the delivered coco syrup. The area where the proposed building will be built is
part of the associations’ equity.

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 Table 10: Facilities and Equipment needed for the Operation

Facilities and Equipment Specification Quantity

Sickle 160
Sanggab Plastic, 2 Liters capacity 32,000
Plastic twine 160
Stainless washbasin Stainless, 24 Liters capacity 160
Pail/bucket Stainless, 24 Liters capacity 160
Strainer for syrup Stainless, 8 inch diameter 160
Consolidation Area  
Stainless washbasin Stainless, 24Liters capacity 3
Pail/bucket Stainless, 24Liters capacity 3
Strainer (for syrup) Stainless, 8 inches diameter 3
Weighing scale flat scale/ bascule, 100 kilos capacity 1
Wok/kawali (stainless) Stainless, 1 meter diameter 3
LPG 50 kilograms LPG content with tank 4
Burner 3 ring cast iron gas stove burner 3
Stainless ladle 1 meter length 3
Tray Stainless, 1x1.5 meters 3
Transportation 
Hauler Truck 6-wheeler, 4Wheel Drive 1
Infrastructure –to be shouldered by the PG
Consolidation Center Concrete, 65.7 sq.m 1

3. Operations

The over-all operations of the enterprise will be managed by the association. The
land owners and farmers will be in-charge of their individual land. Tappers will be assigned
in tapping the coconuts. Cooks and also some of the tappers will be the one who will cook
the collected coco toddy into coco syrup.

Cooked coco syrup will be delivered by the members to the warehouse where it will
be consolidated and stored. The association will then deliver the coco syrup to the buyers

59 | P a g e
as scheduled. Figure 13 shows the simple illustration of the production to marketing
operations of the proposed enterprise.

Figure 13: Production to Marketing Operations

Land Owner/ Farmer

Coconut trees

Tappers/Farmer
Coco sap

Tappers/ cooks
Coco syrup

Tappers/ Land Owner/Farmer

Delivery of coco syrup to the consolidator (association)

Association
Consolidation of coco syrup Delivery of coco syrup to the buyers

4. Compliance to local and national regulations

Since the association was only registered on the February 13, 2016, documents
needed for its operations such as business permits, BIR Registration and other licenses are
still on process.

VI. SOCIAL AND ENVIRONMENTAL SAFEGUARDS

The existing coco syrup business enterprise has been managed by the association
since 2012. For four years up to this period, the association has gained good reputation to
their buyers. Production and marketing activities of coco syrup is basically on a manual
labor basis. But then the process is not that complex. Once the tapper harvested the
coconut sap or toddy it should be immediately processed by boiling for half an hour in a
large cast iron pan to fervent the sap from fermentation.

60 | P a g e
 Tapping a coconut tree for its sap is a centuries old tradition that does not harm the
tree’s ability to produce coconuts. Production of coconut syrup is also known as coconut
nectar. Coconut trees have proven to be the most productive and have the longest life span,
whilst impacting the least negative short and long term effects on the environment and the
well-being of the community within the area.

A. Social Safeguards Aspect

1. Subproject Beneficiaries

The members of the proponent group were all indigenous people. The association is
composed of 100% B’laan, with 28 males and 56 female members.
The labor force of the enterprise is also indigenous people since the population in
the area mostly B’laan or T’boli since it is just adjacent in the barangay. The beneficiaries of
the project are composed of farmer land-owners, tappers and some farm workers.
For this project, the beneficiaries have allocated 80 hectares coconut area with a
total of 8,000 coconut trees. Out of the allocated 8000 trees, 4000 coconut trees are
productive while another 4000 hectares will be used for the expansion of the enterprise for
the next three years of operations.

2. Socio-Economic Status

General Santos City was formerly called as Buayan District and became a
municipality of South Cotabato by virtue of Republic Act No. 82 in January 1948. Its history
begun on February 27, 1939 when the first Christian settlers led by General Paulino Santos
landed on the shores of Sarangani Bay together with 62 first batchers. Economic growth in
the area has been apparent with the establishment of the basic institutions and
infrastructures and the construction of roads and establishment of multi-million companies
such as Standard Fruits Company (Stanfilco) and Coca Cola Bottling Company and the first
establishment of the first radio station in 1964.

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 The City has a total land area of 53,606 hectares. Barangay Sinawal constitutes the
biggest land area at about 68.76 sq. km with a population density of:

Year Population
Density
2007 157.96
2000 110.09
1995 38.09
1990 10.79

Family income & Expenditure:

Family income includes income in cash or in kind such as produced from family owned
farms consumed by the households. Almost all of the recipients were tilling their land and
used it as coconut farming, banana plantation and corn farming to augment their income
they were raising farm animals for food consumption and sell the other at the market in
the city. Some of them also drives “habal-habal” motorcycle in order to sustain the basic
needs of their family. Thus, most of the residents in the barangay had income below the
minimum basic standard.

Socio-Economic Condition and Challenges faced by the project proponents were:

 Coconut trees were damaged caused by El Nino Phenomenon
General Santos City experienced long dry spell and it greatly affected all the
crops as well as farm animals. The proponent group is requesting for a seedlings
and fertilizer subsidy to replace damaged crops.

 Less Access to Technology, Mechanized Facilities and Equipment. Due to

limited access to funds and microfinancing institution, the association were
not able to upgrade its existing traditional facilities, thus resulting to low
productivity and wastage of time and resources.

62 | P a g e
3. Benefits
The general objective of the business enterprise is to improve quality of life of coconut
farmers, especially the Indigenous Peoples in the upland communities, by practically
increasing their income from their coco syrup production.
The project will also help the beneficiaries packaged their product for better market
opportunity. This will eventually help the association sell their produce to a wider market
such as the international market which is one of the future plans of the association.

1. Consultation Process
There were series of coordination and consultations conducted to the various
stakeholders by the Local Government of General Santos through the CPMIU together with
Regional Project Coordinating Office of the Department of Agriculture 12.

Two meetings were also held in Purok Malipayon, Barangay Sinawal which was
attended by the association’s members and staff of the City Agriculturist Office.

The direct members were also consulted by the proponent group. They have
undergone the process of coordinating, meeting and orientation with the board and the
general assembly. Please see attached documents of consultation meetings (minutes,
photos and attendance sheets) Annex “Z”.
2. Acceptance of the Proposed Project

The proposed project is socially accepted by the identified stakeholders as it would

significantly enhance the economic condition of the direct and indirect beneficiaries.

The Barangay Council of Sinawal had passed Resolution No. 17 Series of 2016,
approving the proposed enterprise due to its viability.

3. Concerns and Inputs/Women Participation

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 Women Participation
Significantly, women members of the association have actively participated during the
POs Consultation on Coco syrup production and marketing. Common concerns damaged
coconuts that were affected by long dry spell. But then this can be arrested since they will
request from the City Agriculturist Office and Philippine Coconut Authority the seedlings
and fertilizer in replacement of the damaged crops.
The project will create additional Household Income for 34 IP women by providing
them livelihood activity through processing or cooking of coco syrup that has been
harvested by the tappers. Aside from the direct members of the association, wives of the
tappers also do the cooking of coco sap into coco syrup.

7. Indigenous Cultural Community/Indigenous Peoples (ICC/IP)

Long time ago, before the arrival of settlers here in General Santos City, Barangay
Sinawal was inhabited purely by natives called “B’laans”. The word B’laan was taken from
B’laan boy was drowned in the once unnamed river in the place. The name of the boy was
“As-nawal” devolved into Sinawal since it is easier for them to utter. At present, they still
dominated in the area.
The area of the proposed enterprise is not yet verified if it is part of ancestral domain.
But according to the National Commission on Indigenous People, Prk. Pao-pao, Brgy.
Sinawal where the propose enterprise is located is adjacent to the CADT of the municipality
of T’boli with survey number Ads-1202-0004-Gni.
As mentioned above, the community in the area is consisting mostly of B’laan. In fact,
the proponent of the proposed enterprise is composed of 100% B’laan. People residing in
the barangays are mostly farmers and farm workers since the area is considered as an
agricultural upland barangay.

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 Various consultation meetings had been conducted purposely for the project. Site
visitation was also done. On February 2016, orientation regarding PRDP was conducted in
the area. Most members of the Sinawal Small Farmers’ Association were present. During
the orientation, it was discussed to them the rationale of the PRDP. The group actually had
a positive response regarding the program. In fact, most of the ideas for the project are
from the members of the association. Orientation and consultation regarding the project
was also been conducted with the barangay officials.
During one of the consultations, the members of the proponent group were mostly
concern on their coconut trees that were affected by the El Niñ o phenomenon which
produces less coco sap, however, this effect can be corrected with proper fertilization and
care of coconut trees once favourable weather condition will be observed.

8. Site Acquisition

The production site as well as the consolidation center is located within ancestral
domain. Based on the existing land use, the proposed project site where the establishment
of the processing facility and the warehouse is within the Alienable and Disposable (A&D)
land and declared as not needed for forest purposes.
However, there are portions in the production area which are privately owned. A
member of the association already crafted a deed of donation purposely for the
construction of the consolidation center where they will use as storage for their produce.
The said land was also part of the association’s equity for the project.

9. Damage to Standing Crops, Houses and/or Properties

The operation of the proposed enterprise will not damage any crops or hamper other
farm activities but it actually could boost production since one of the main objectives of the
enterprise is to increase the beneficiaries’ income through increase in production of coco
syrup.

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 10. Physical and Economic displacement of persons

The project involves production & marketing. Thus, the proposed subproject will not
cause any dislocation and relocation of settlements. Consequently, since, there were no
physical displacement of households nor families, the issue on economic displacement of
persons is not applicable.
In terms of social impact, there would be great possible economic opportunities to the
society within and outside the influence area, thus, improvements of well-being.

11.Grievance Redress Mechanism

The Local Government of General Santos is on the process of creating the Grievance
and Redress Mechanism (GRM) through Executive Order No. 19 Series of 2017 effective
February 21, 2017 to oversee and monitor feedbacks or grievances that may come up
before, during and after project implementation.
Also, to easily address any problems that might arise during the implementation of
the project, the association itself has created its Grievance Committee which will be task to
do initial assessments on the complications.
The head of the CPMIU will be the chairperson of the Grievance Committee while the
SES Unit Head will be the Vice – chairperson and will also act as the secretariat of the
committee. On the hand, the I-BUILD Head, I-REAP Head, Finance Unit Head, the BAC
Chairperson, the Monitoring and Evaluation Unit Head and two (2) civil society leaders,
which will be appointed by the City Mayor, will be the members of the said committee.
The association has also passed Resolution No. 01, Series of 2016, were the
association’s officers has appoint Mr. To Talib as their grievance point person where he
will ne incharge of complaint and grievances that may arise.

B. Environmental Safeguard Aspects

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 1. Natural Habitat
General Santos City as a whole does not have any protection forest. Most of the
forestlands are being utilized for agricultural purposes a large proportion of its A&D land is
being utilized as built up, agriculture and pasture lands.
The project has been selected due to its accessibility to the associations’ production
and processing area. Most, if not all of the production areas are hilly land. Presence of
spring water supply source in the project site is stable.
There were no endangered or threatened species found in the area. Proper flora and
fauna inventory will be conducted as part of the baseline information and input to other
study later on.
Since the project area is an agricultural land, agricultural crops such as corn,
coconuts, rambutan, and mango is present in the area. There are also some forage grasses
such as napier and paragrass since a cattle ranch is also situated nearby. Many bamboo
grasses are also seen in the area, especially in the creeks along the side of the road.

1. Physical Cultural Resources

Based on field validation and attached geotagged data of the project site, there is no
physical cultural resources on the site that would be affected by the project. The project
site is not part of an important natural feature or landscape thus, there would be no
adverse impacts on the existing resources.
If any case there will be an archaeological and/or Paleontological finds in the area, the
following producers stated in Annex H-2 of IESSF will be followed and properly notify the
National Museum and other concerned agency for evaluation and assessment:
a. This procedure shall be made known to the Local Government Unit (LGU)
Contract Administrator, the Contractor, the Site Engineer, all Construction
Foremen and all On-Site Supervisors.
b. A copy of this procedure shall be made available at the construction site at all
times.

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c. Upon discovery of artifacts, bones or other objects of interests, all digging,
drilling and other earthmoving activities within the radius of 10 meters from the
discovery point shall be immediately suspended. The highest ranking officer of
the Contractor present at the site must impose the suspension of activities and
immediately inform the LGU Contract Administrator or if not available, the
highest ranking LGU officer available.
d. The highest ranking officer of the Contractor at the construction site with or
without the LGU Contract Administrator or LGU representative shall
immediately take photographs of the artifacts, bones or other objects of interest.
The photographs must be taken at closeups and at distant range or at wide-shots
placing the objects at the approximately the same point and position where they
were found and showing other markers.
e. The highest ranking officer of the Contractor at the site must ensure that the site
is secured and any artifacts, bones or objects of interests already removed from
the site must also be placed in a secured place or container.
f. The LGU Contract Administrator and/or highest ranking Officer from the LGU
shall immediately report the discovery simultaneously to: (a) the Regional
Project Coordination Office (RPCO) Social and Environmental Safeguards (SES)
Officer and Engineer or if not available, the highest available ranking Officer of
the RPCO; and, consistent with RA 8492, (b) to the National Museum. The
following are the contact numbers of the Archaeology Division of the National
Museum: Email: archaeology@nationalmuseum.gov.ph Telephone Numbers
Curator: (+632) 527-03-08 Administrative: (+632) 527-12-35 Records Section:
(+632) 527-11-40, Underwater Telephone: (+632) 527-11-57 Photographs of
the finds and the site shall also be sent to the RPCO SES Officer and to the
National Museum, preferably through email.
g. The highest ranking LGU official at the time shall also immediately inform the
local police and civil authorities who, consistent with Section 20 of RA 8492,
shall preserve and protect the site from illegal exploitation until such time as the

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 National Museum shall have established control over them. 8. Upon knowledge
of the discovery and prior validation, the RPCO Head shall also inform the PSO
Head and NPCO Head who shall coordinate with the National Museum on further
actions or evaluations.
h. Depending on the National Museum’s evaluation, actions and recommendations,
the LGU, RPCO, PSO and NPCO shall then determine the fate of the Subproject.
i. Any delay due to suspension or any discontinuation or termination of the
Contract through or as a result of the application of this Procedure shall be
considered “force majeure” and hence the applicable provisions of the
Contractors Contract (particularly, the provisions described in Section 20 of the
General Conditions Philippine Bidding Documents) shall be applied.

b) Terrain, Soil Types and Rainfall

The terrain of the project site is plain to mountainous with a tropical climate. Soil type
in the area is sandy loam and clay loam which is typically suitable for most of the
agricultural crops. A well distributed rainfall throughout the year and a typhoon free is
observed.

c) Hazard/Risk Assessment (Drainage Situations, Erosion and Flooding

Potential)
Considering the area belongs to the upland barangays of the city, soil erosion and
landslide could happen in the area. According to the landslide susceptibility map of the City
Land Use Plan, the barangay falls under moderate to high susceptible. Fortunately, the
production area of the association is located on the flat to slightly rolling area. The soil in
the proposed project site is compact, thus the production area and the consolidation
building will be ensured that there will be no damages caused by disaster that may occur
during the project implementation.

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 There will be no problem in terms of the volume of solid waste to be generated during
the project operations since there will be no or minimal solid waste when producing coco
syrup. However, proper disposal for solid and liquid waste will still be observed.
On the existing drying facility appropriate drainage and sewerage had been constructed
in order not to pollute the nearby water body and source and possible air pollution due to
foul odor that may emanate from the drying facility. Besides, the area is not prone to flood
and ever since there is no occurrence of natural calamity in the area.
Several major potential impacts are being carried out in the Environmental and Social
Management Plan though in this subproject there are no major issues as to the
environment and socio-cultural implications that will negatively affect the surroundings.

d) Integrated Pest Management and DA-KASAKALIKASAN

There is an existing practice of Integrated Pest Management Program (IPM) in the area.
IPM is an effective and environmentally sensitive approach to pest management that relies
on a combination of common sense practices. However, it takes advantage of all
appropriate pest management options including but not limited to judicious use of
pesticide.
Some of the member of the proponent group has undergone KASAKALIKASAN training
as part for the Farmers Field School Season long training several years back which was
facilitated by the City Agriculturist Office. The Philippine Coconut Authority has also done
some seminars about proper care of coconut.
In Sinawal they practice using manual removal of dried leaves on the trees and proper
sanitation to prevent pest and diseases. Parasitoids are also to minimize and prevent the
spread of some pest such as Brontispa which cause drying or burning of the young coconut
leaves. Information campaign and training will enable farmers in the influence area acquire
knowledge, skills and awareness to adopt IPM program.

C. Social and Environmental Impacts

(Please refer to the attached ESMP )

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 VII. FINANCIAL PLAN

1. Sources and Application of Funds

The proposed project will be funded through the Philippine Rural Development
Program (PRDP) of the Department of Agriculture. Necessary counterpart for the project
will also be provided by both the LGU of General Santos City and the Proponent Group
identified to the beneficiary/ies of the proposed enterprise which is the Sinawal Small
Farmers’ Association (SSFA) located in Barangay Sinawal, General Santos City.

Table 11: Fund Sources and Allotment

FUND SOURCES AND ALLOTMENT

COMPONENT and ALLOTMENT AMOUNT, Php
I-REAP (Enterprise Development)  
(60%) Loan Proceeds (WB) 1,517,400.00
(20%) Government of the Philippines (DA) 505,800.00
(20%) City Government of General Santos 505,800.00
(At least 20%) Proponent Group (SSFA) 508,000.00
Sub-Total (I-REAP) 3,037,000.00
Total Project Cost 3,037,000.00

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 Investment Requirement by Component and By Fund Source

Table 12: Investment Requirement by component and by fund source

FUND SOURCES
Components / Line Items Total Cost Proponent Group
LP (Cash) GOP (Cash) CLGU (Cash)
Capacity Qty Unit Cost Cash In  Kind
Working Capital
Harvesting to Processing
Labor cost/ha (Tapping/boiling/day) 40 1,200.00 288,000.00 288,000.00
Production facilities/equipment
Farm-Level Processing
Sickle 160 500.00 80,000.00 48,000.00 16,000.00 16,000.00
Sanggab (Plastic - 2L cap) 4 sanggab/puno 32,000.00 20.00 640,000.00 384,000.00 128,000.00 128,000.00
Plastic twine 160 250.00 40,000.00 40,000.00
Stainless washbasin (24L cap) 4/pugon 160 500.00 80,000.00 48,000.00 16,000.00 16,000.00
Pail/bucket (stainless) 24L cap 4/pugon 160 800.00 128,000.00 76,800.00 25,600.00 25,600.00
Strainer for syrup (stainless) 8 inch dia 4/pugon 160 200.00 32,000.00 19,200.00 6,400.00 6,400.00
Consolidation Area
Stainless washbasin (24L cap) 3 500.00 1,500.00 900.00 300.00 300.00
Pail/bucket (stainless) 24L cap 3 800.00 2,400.00 1,440.00 480.00 480.00
Strainer for syrup (stainless) 8 inch dia 3 200.00 600.00 360.00 120.00 120.00
Weighing scale (flat scale/bascula) 1 15,000.00 15,000.00 9,000.00 3,000.00 3,000.00
Wok/kawali (stainless) 3 6,000.00 18,000.00 10,800.00 3,600.00 3,600.00
LPG 4 6,000.00 24,000.00 14,400.00 4,800.00 4,800.00
Burner 3 1,500.00 4,500.00 2,700.00 900.00 900.00
Stainless ladle 3 500.00 1,500.00 900.00 300.00 300.00
Tray (stainless) 3 500.00 1,500.00 900.00 300.00 300.00
Transportation
Hauler Truck (6-wheeler) 1 1,500,000.00 1,500,000.00 900,000.00 300,000.00 300,000.00
Infrastructure
Land 1 180,000.00 180,000.00 180,000.00

Grand Total 3,037,000.00 1,517,400.00 505,800.00 505,800.00 - 508,000.00

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 2. Recording System

Record-keeping is a requisite for a successful business operation. The records kept

the organization/company are usually the basis for monitoring and evaluation as to the
operation of a business undertaking.

Financial recording system will be based on the Generally Accepted Accounting

Principle. The association will follow the Standard Chart of Accounts for cooperatives
which was recommended by the Cooperative Development Authority since the association
will convert into a cooperative in the coming years. The association will be required to
maintain a separate set of Books of Accounts and necessary Subsidiary Ledgers for this
particular business enterprise. The cooperative will hire its own full-time bookkeeper to
ensure the prompt and reliable recording of financial transactions.

A monthly Financial Statements shall be prepared for the consumption of the

Management, Officers, and Partners/Stakeholders as well as members. Set of Policies
Systems and Procedures on Accounting, Bookkeeping, Financial Recording, Cashiering,
Internal Control will be installed.

3. Financial Forecasts/Projections

Table 13: Financial Assumptions

1 The Proponent Group will be engaged in the processing of coco sap into coco syrup
The PG has an existing area of production of 40 hectares; after three years, an additional
2 40 hecatres will be tapped
The PG will market their product to the three buyers, namely: Suchero in Tupi, South
3 Cotabato, Free Foods in Davao City and Gees Organics in General Santos City
The existing volume of demand of both Suchero and Free Foods is 1000 kilograms of coco
sugar per day. These volumes will increase since the two companies are also producing
4 other food-based products from coco syrup
Raw materials: 6 liters of coco sap is equal to 1 liter of coco syrup;
5 24 Liter of coco syrup is equal to 21 kilos of coco sugar

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6 Daily operation (production) with 4 harvest-time a day
7 100 coconut trees tapped in a hectare
8 Manpower Requirement
a. 160 tappers for harvesting and cooking/boiling of sap into coco syrup
b. Receiving area = 1 bookkeeper, 2 laborer(hauling), 1 cashier/treasurer, 1 supervisor, 1
janitor
c. Trucking = 1 driver, 2 laborer (hauling)
9 Wages of worker:
# of
Particulars Salary Remarks
persons
Will be paid by the
Manager 1 10,000.00/mo
association
Will be paid by the
Bookkeeper 1 7,000.00/mo
association
Will be paid by the
Cashier 1 7,000.00/mo
association
Will be paid by the
Operation Supervisor 1 7,000.00/mo
association
Will be paid by the
1,200 per 24L of coco syrup
Tappers/Cook 160 individual members of
produced
the association
20% from the trucking Will be paid by the
income: association
(sample computation:
120 containers/ trucking @
Driver 1
P40.00/container = 4,800,
20% of 4,800 is 960 which
will be the salary of the
driver per trip)
10% from the trucking Will be paid by the
income: association
(sample computation:
120 containers/ trucking @
Laborer 1
P40.00/container = 4,800,
10% of 4,800 is 480 which
will be the salary of the
laborer per trip)

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4.1 10-Year Projected Cash Flow Statement
Table 14: 10 – Year Projected Cash Flow Statement

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 The 10-Year Projected Cash Flow Statement shows a yearly positive cash flow. This means that revenues/sales
that will be generated by the business operation are more than enough to sustain the project. This also shows that the
proposed project can help the cooperative to settle all financial obligations and the cash available can still be used for
expansion and other income-generating ventures. It is further proposed that after three years and five years, the
project is able to replace equipment which has been fully depreciated as of its end of useful life with equal amounts.

a. 10-Year Projected Income Statement

Table 15: 10-Year Projected Income Statement

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 The Income Statement is the summary of all the income generated and expenses incurred by a certain business
endeavor over a given period of time. It reflects whether the business is profitable or not. The above 10-year Projected
Income Statement shows positive net return for the next 10 years of operation. As indicated above, net income is increasing
on a yearly basis as evidence by an increasing ROI.
On the revenue and total cost of production, the proposed enterprise can generate an average Net Income of Php
45,358,420.02. Average ROI is 1502% and average BCR is 1.69. This means that for every one peso investment, there is a net
return of 0.69 centavos. This indicates high degree of profitability of proposed enterprise.

b. 10-Year Projected Balance Sheet

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 Table 16: 10-Year Projected Balance Sheet
Consolidated Projected Balance Sheet
Sinawal Small Farmers' Association
Pre-operation Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Assets
Current Assets
Cash 720,000.00 5,827,521.33 11,352,991.17 17,331,124.29 29,928,796.15 43,917,442.24 59,060,771.47 75,117,297.45 93,712,800.35 114,801,924.51 138,365,789.32
Other Current
Total Current Assets 720,000.00 5,827,521.33 11,352,991.17 17,331,124.29 29,928,796.15 43,917,442.24 59,060,771.47 75,117,297.45 93,712,800.35 114,801,924.51 138,365,789.32

Non-current Assets(delete if not

applicab le, use non-current
assets instead)
Real Estate-Land - - - - - - - - - - -
Vehicles 1,500,000.00 1,500,000.00 1,500,000.00 1,500,000.00 1,500,000.00 1,500,000.00 1,500,000.00 1,500,000.00 1,500,000.00 1,500,000.00 1,500,000.00
Other Fixed Assets 309,000.00 309,000.00 309,000.00 309,000.00 324,450.00 324,450.00 324,450.00 340,672.50 340,672.50 340,672.50 357,706.13
Total Fixed Assets 1,809,000.00 1,809,000.00 1,809,000.00 1,809,000.00 1,824,450.00 1,824,450.00 1,824,450.00 1,840,672.50 1,840,672.50 1,840,672.50 1,857,706.13

Less: Accumulated Depreciation (253,000.00) (506,000.00) (759,000.00) (708,150.00) (966,300.00) (1,224,450.00) (1,163,557.50) (1,427,115.00) (1,690,672.50) (1,619,235.38)
1,556,000.00 1,303,000.00 1,050,000.00 1,116,300.00 858,150.00 600,000.00 677,115.00 413,557.50 150,000.00 238,470.75
Total Assets 2,529,000.00 7,383,521.33 12,655,991.17 18,381,124.29 31,045,096.15 44,775,592.24 59,660,771.47 75,794,412.45 94,126,357.85 114,951,924.51 138,604,260.07

Liabilities and Owner's Equity

Liabilities (delete if not applicab le) 0 0 0 0 0 0 0 0 0 0
Total Liabilities

Owner's Equity
Beg. Balance 2,529,000.00 7,383,521.33 12,655,991.17 18,381,124.29 31,045,096.15 44,775,592.24 59,660,771.47 75,794,412.45 94,126,357.85 114,951,924.51
less: Dividends 11,327,216.44 12,302,429.63 13,358,643.95 29,549,267.66 32,037,824.21 34,732,084.88 37,645,162.28 42,774,539.26 48,592,988.88 55,188,782.98
Add: Net Income 16,181,737.78 17,574,899.47 19,083,777.07 42,213,239.51 45,768,320.30 49,617,264.11 53,778,803.26 61,106,484.66 69,418,555.55 78,841,118.54
Initial Investment
Loan Proceeds 1,517,400.00
GOP 505,800.00
LGU 505,800.00
Proponent Group -
End. Ba la nce
Total Owner's Equity 2,529,000.00 7,383,521.33 12,655,991.17 18,381,124.29 31,045,096.15 44,775,592.24 59,660,771.47 75,794,412.45 94,126,357.85 114,951,924.51 138,604,260.07

Total Liabilities and Owner's Equity 2,529,000.00 7,383,521.33 12,655,991.17 18,381,124.29 31,045,096.15 44,775,592.24 59,660,771.47 75,794,412.45 94,126,357.85 114,951,924.51 138,604,260.07

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 The Balance Sheet shows the financial position of the proposed business endeavor
the value of the assets generated and the corresponding liabilities incurred by the
organization. To ascertain the financial position of the proposed enterprise, several
financial indicators are used. The most common indicators are the networth, liquidity and
solvency.

The Networth is the difference between the assets and liabilities of the proposed
project. A positive networth indicates that assets are higher than liabilities. On the other
hand, Liquidity is the ratio of current assets over current liabilities with an ideal ratio of 2.0
and above. Liquidity shows the capacity of the business to settle short-term financial
obligations as they fall due. On the other hand, solvency can be computed using the debt-
asset ratio and debt to networth ratio. For a business to be considered solvent, it should
have an ideal ratio of less than 1. Solvency spells out the capacity of the business to have a
long-term financial sustainability and can withstand financial setbacks.

Since the proposed enterprise does not have any liabilities, it can therefore, be
considered as liquid and solvent at the same time.

5.1. Financial Analysis

An investment analysis is done to determine the profitability of a certain business

enterprise considering the time value of money. A certain rate of interest is being factored
in the formula which is based on the current lending rate in the financial system. It is done
to enable the investor to decide whether or not to invest in a certain business. At present,
the lending rate is 15% based on the WorldBank.

One method used is the Net Present Value (NPV). The NPV shows the present
values of the proposed business enterprise’s future stream of incomes. Another method is
the Internal Rate of Return (IRR). The IRR is the actual rate of return of the proposed
business undertaking,

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 The result of an investment analysis shows an NPV of Php 185,919,113.22 and an
IRR of 1502%. By concept, a business will be considered as profitable if the NPV is positive
and more than its investment cost. This is satisfied by the NPV value which Php
184,919.113.22 for the next 10 years of operation which is very much higher than the
investment cost of Php 3,037,000.00. In addition, the IRR is 1502%. As a rule, IRR value
should be greater than the interest rate/lending rate. The result shows higher profitability
since the IRR is 1502% which is very much higher than the interest rate of 15%. Hence, the
proposed enterprise is very profitable.

In addition, the payback period is also used to gauge how long the investment will
be recovered. It is measured in the number of years. Based on the result, the proposed
enterprise will be able to recover the investment in 2.25 months. This is a good indication
since the investment can be recovered in a very short period of time. As a rule, investments
with shorter payback periods are more attractive to investors.

Table 17: Payback period

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 V.2. Break-Even Analysis

Break even analysis is the calculation of margin of safety the proposed project based on the potential revenues
and expected associated costs. This determines the level of sales needed to cover the total fixed costs. Based on the
results, the proposed project has an average break-even volume of 14,100.52 kgs of coco sugar for the next 10 years of
its operations. On the other hand, the average break-even sales is at Php 1,371,277.71 for the next 10 years.

Table 18: Break-Even Analysis

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 V.3. Sensitivity Analysis

Sensitivity analysis is a method used in determining the effect of a certain dependent variable if there are changes in
values of independent variables. In this subproject, this tool is used to measure the effects on the Net Present Value, Internal
Rate of Return, Benefit-Cost Ratio and Return on Owner’s Investment if there will be increases and decreases in both the
revenues and costs associated with the processing and marketing of coco syrup. Based on the results, the proposed subproject
will still be earning profits even if there are possible decreases in revenues and increases in costs for the next 10 years of its
operation.

Table 19: Sensitivity Analysis

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 VIII. ECONOMIC ANALYSIS

With the PRDP intervention a farmer can earn a gross annual income of
1,013,392.10 in his one hectare coconut plantation with 100 trees, with an average
coco sap harvest of 224 liters daily.
Table 20 shows the income difference with PRDP intervention and without
PRDP intervention. Traditionally, farmers choose production of conventional copra,
one reason could be that conventional copra is labor extensive compared to
production of coco sap. But in terms of income, the difference between production
of copra compared to coco syrup is quite higher. Annually a farmer can earn a gross
of income around Php 58,377.78 in his one hectare conventional copra production,
while a farmer engaged with coco syrup production can earn an annual gross of Php
1,013,392.10 in his one hectare coconut plantation with 100 trees.

Table 20: Income comparison with and without PRDP intervention

Coco Syrup production per ha
With PRDP Without PRDP
Sap/ha/year 224.00 179.00
Syrup/ha 37.33 29.83
Syrup/ha/year L 13,626.67 10,889.17
Production of Coco sugar /ha/year 14,904.17 9,528.02
Price /kg of coco sugar 85 85
Production Cost/ container 1,200 1,200
Total Production Cost per year 545,067 408,344
Gross profit 1,266,854.17 809,881.77
Revenue 721,787.50 401,538.02

* production cost includes harvesting and cooking

*1200 pesos per container, 1container=30L of syrup
*buying of syrup based on the volume of coco sugar

EXPLANATION

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 It is also expected that new jobs will be generated once the enterprise will
start its operations. Around 324 new jobs will be created which will be help the
living conditions of the community in the area. The manpower requirement for the
said enterprise will be 160 tappers, 160 cooks which will be mostly if not all women,
1 driver for the truck being requested, 1 general manager, 1 operations manager
and 1 cashier. Laborers will also be hired but it is not yet fixed on how many
laborers will be hired. Table 21 shows the increase of jobs generated by the
enterprise.

Although tappers, cooks and laborers are essential in the operation of the
enterprise, salaries and wages will be shouldered by the members since this will be
the counterpart of the individual land owner members of the association. Thus, the
job is considered part time since the members could choose who will tap and cook
for them. While the wages and salaries of the driver, general manager, operations
manager and cashier will be paid by the association from the income they acquire
from the enterprise, therefore, the job is considered as full time.

Table 21. Increase of jobs generated by the enterprise

Incremental Full time/ Part
Job Title Existing New Jobs
Jobs time
Part time
160 tappers in the
1-2 years and
Tappers 160 tappers 160
additional 160
tappers onwards
Part time
On individual/
Syrup Makers/Cooks 160 160
household basis
Driver None 1 1 Full time
Helper/Laborers None As necessary Part time
General Manager None 1 1 Full time
Full time
Operations Manager None 1 1
Cashier None 1 1 Full time
Total 324 324

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 IX. SUSTAINABILITY MECHANISM

To ensure sustainability of the proposed project, the following aspects will be

looked into and appropriate steps will be undertaken by the Proponent Group:
1. Technical Support Services
The Association will be assisted by the various agencies in the implementation of
the subproject. In particular, the DA-PRDP will provide technical support through
orientation, preparation of necessary documents before, during and after project
implementation. Continuous monitoring and evaluation of the progress of the
project implementation.
The Philippine Coconut Authority on the other hand will provide technical support
in terms of production technologies for the proper cultural management practices of
coconut trees. Moreover, the Local Government of General Santos City through the
Office of the City Agriculturist will assist the Proponent Group during the selection
process, as well as in the prepration of the necessary documents relative to project
implementation.
2. Expansion in the production area from 40 hectares in the initial years of
implementation to 80 hectares after 3 years. This will not only increase the income
of the association but more so of the individual farmers as well as tappers who are
involved in the project.
3. Expansion in the membership to provide opportunities to other coconut farmers to
be part of the project and will be able to reaps its benefits.

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4. Convert the association to cooperative to give the organization more capacities to
run and diversify its operation.
5. Expand and diversify market linkages to by identifying additional and alternative
markets for the product of the proposed.
6. Engage in coco sugar production and marketing as part of the future plans of the
association
7. Diversify and engage in other value-added products to give more profits and
eventually benefits the members and other stakeholders of the proposed enterprise.

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