Strategies and Innovations of Balut Processors in Victoria, Laguna

Date

4-2013

Degree

Bachelor of Science in Agribusiness Management

College

College of Economics and Management (CEM)

Adviser/Committee Chair

Nimfa Beatris D. Montes

Request Access

For non-UP researchers, requests for access to this material may be directed to the CEM Library at cemlibrary.uplb@up.edu.ph or to the UKDR administrator at uscs-mainlib.uplb@up.edu.ph

Abstract

The study was done to present and evaluate the strategies applied and the innovations of the balut processors in Victoria, Laguna. The specific objectives of the study were: (1) to present the profiles of the current and former balut processors in Victoria; (2) to determine the key internal and external factors affecting the continuity of the balut operations; (3) to describe past and current innovations adopted by balut processors; (4) to evaluate the strategies done by the processors; (5) to identify strategic issues; and (6) to give recommendations based on the findings of the study.

A total of 11 balut processors were identified and interviewed in the study. The list of processors was obtained from the Municipal Agriculturist of Victoria. Five of the balut processors came from the list taken from the municipality while the other six were identified through the snowball or referral method.

Evaluation of the strategies applied by the processors was done through the analysis of their advantages and disadvantages. The SWOT analysis was also employed to summarize the internal and external factors acting upon the balut business. These strengths, weaknesses, opportunities and threats were analyzed due to their influence in the business decisions and strategies applied by the balut processors.

The current processors with the largest and smallest size of operations were producing 35,000 and 10,000 eggs/wk respectively. On the other hand, the former processors produced 10,000 and 3,000 eggs/wk respectively. The processors did not receive any training and were not under any affiliation except for one who is a member of an organization related to duck feeds. The processors who have established their business several years ago showed competitiveness as they have already encountered several problems and issues through their years in operations. These factors significantly affect the strategies and decisions in the operations. The external factors affecting the business were supply of duck eggs, costs of duck feeds, competition with other provinces, salted egg producers, exportation of balut, government assistance and aging population. The internal factors affecting the business were seasonal production, underutilized incubators and overcapacity in production, skills of the balut processors, the role of the balutan workers and financial standing. These factors have pushed the processors to create different strategies to apply in their business such as concentric diversification, conglomerate diversification, differentiation, backward integtration, forward integration and liquidation.

The study showed changes in the seasonality of demand due to climate change. The price of balut was still highly dependent on the prices of duck eggs which continue to increase due to expensive inputs in the duck farms and different factors in its operations. The market for balut grew larger because of the wholesalers that distribute balut in other hard to reach places. Victoria balut processors use the modern mechanical incubation method in processing balut which was much easier than the traditional method and more convenient to the processors. The new technology affected many parts in the production such as lower processing time, larger capacity for production and less dependence on manual labor.

The innovations in the balut business in Victoria were more strict classification of penoy and other by-products, combining modern and traditional incubation method, catering to institutional markets, reduction in number of labor days and labor work through mechanization, and backward integration.

Profitability analysis showed that processors are able to gain profits but with a low net margin due to high costs of production. Net margin increases when backward integration and forward integration strategies were applied.

Current problems such as irregular supply of eggs and high costs of production, and strategic issues like lack of succession, untapped opportunities for market penetration domestically and internationally, as well as lack of access to working capital were seen.

It was recommended that the processors exert effort in penetrating the local market first before going into the international market scene due to many underappreciated opportunities in restaurants, fast food and supermarkets in the country. It was recommended that processors apply best price strategy to low income buyers for attracting more of the market. This will solve the problems of increasing competition from other provinces. The processors were recommended to source agricultural and support services from different government agencies and other related institutions such as BAI, DTI, DOST, PCAARRD and FNRI. This could help the balutan business to innovate and improve operations. Other helpful services these institutions give are financial and administrative support which could be of good use for processors as well as trainings and seminars to be given to younger farmers and entrepreneurs to enlighten them with the importance and benefits of the duck and balutan business.

Language

English

LC Subject

Egg trade--Seasonal variations, Egg products industry

Location

UPLB College of Economics and Management (CEM)

Call Number

LG 993 2013 M17 E46

Notes

Viewing access to electronic resources is restricted solely to UP Gmail accounts. Any access and share requests from external organizations and personal email accounts will be promptly declined.

Document Type

Thesis

Link to Full Text

Share

COinS