Namnama Piggery Farm: A Case Study

Date

4-2010

Degree

Bachelor of Science in Agribusiness Management

College

College of Economics and Management (CEM)

Adviser/Committee Chair

Victoria R. Guieb

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Abstract

Namnama Piggery Farm (NPF), Namnama Enterprises (NE), and Namnama Showroom and Artificial Insemination Center (NSAIC) are three of the many swine production related businesses in Ilocos Norte, one of the provinces in Region I. These are all supportive to each other and separately registered as sole ownership of Mr. Marshal M. Cruz. The focus of the study was NPF and along the way, NE and NSAIC were put into the picture as the marketing, production, personnel, and finance aspects of the NPF were presented.

The study generally presented the status and assessed the overall performance of NPF; thereby recommending strategies for strengthening the competitive position of NPF. Specifically, the study aimed to: 1) present and evaluate the different business environments affecting NPF; 2) describe and evaluate NPF in terms of the four business functions, namely: marketing, production, personnel, and finance; 3) assess the relationship among the three Namnama businesses, namely: NPF, NE, and NSAIC; 4) define the major problem relevant to the business issues of NPF; 5) generate and evaluate solutions to the indentified major problem, and identify the best solution using an appropriate criteria; and 6) design an implementation plan for the solution, and evaluate the business implications of the solution.

The study used the descriptive and action research designs. The data used were both primary and secondary. However, primary data were used mainly by the author to serve the purpose of the study. Primary data were gathered through survey, observations, and interviews. Secondary data were sourced from undergraduate special problems of University of the Philippines Los Baños, published books and manuals, municipal and provincial records, journals, and other references from credible internet sources. Records on marketing (sales), production (inventories), personnel (lists), and finance (financial statements) were directly obtained from the farm manager and farm supervisor.

Results of the study showed that the strengths of NPF include: 1) good accessibility to market information; 2) after-sales service offerings; 3) sure supply of its primary inputs; 4) presence of accessibility channels; 5) wide customer source; 6) use of hybrids 7) employment of AI; 8) good and accessible location; 9) improving activity ratios; 10) farm manager and supervisor with good technical skills; and 11) availability of areas for physical expansion or for farm utilization. On the other hand, the weaknesses of NPF include: 1) limited number of employees; 2) incompetent skills among laborers of NPF; 3) poor documentation or no formal system of recording production activities and financial matters; 4) NPF has unsatisfactory farm layout; 5) decreasing profitability ratios; 6) NPF has poor waste disposal system; and 7) NPF has low number of regular/loyal customers.

The identified opportunities in the industry were: 1) Ilocos Norte has become popular for being swine-disease free province; 2) there is a general increase in liveweight price; 3) there is a growing demand for fatteners; 4) there is a general increase in retail prices of pork; 5) there is low intensity of rivalry; and 6) NPF has an opportunity to enter into lechon business. On the other hand, the identified threats were: 1) the importation of hogs in the province adds competition to NPF and other players; 2) there is an increased risk of disease transmission due to importation; 3) there is high threat from substitute products (breeds); and 4) there is relatively high threat from potential backyard raisers.

The case problem of the study was: What growth strategy should NPF pursue in order to take advantage of the opportunities in the market and consequently, overcome the decreasing trend of its net income? The problem statement was posed to address the problem on how to grab the opportunities in the market, as desired by Mr. Marshal M. Cruz, and overcome the decreasing trend of the net income. The case problem at the same time serves as an umbrella question for the

identified issues like: 1) high mortality of piglets; 2) unmaximized sow productivity; 3) non- routine/non-full replacement of stocks; 4) poor documentation or no formal system of recording

production activities and financial matters; 5) unsatisfactory layout of the farm area; 6) ineffective or poor waste disposal system; 7) loss or decrease of sales opportunities; 8) low number of regular or loyal customers; 9) increasing trend of operating expenses; 10) decreasing return of equity (ROE); 11) decreasing return on investment (ROI); 12) decreasing net profit margin; 13) lack of employees; 14) lack of competent skills among laborers; and lack of time for strategic planning in the case of general management aspect.

There were three alternatives/solutions/strategies formulated, namely: 1) maximize the physical capacity of the farm; 2) extend farm operation into pork retailing; and 3) extend farm operation into lechon retailing. There were several inclusions made common to all alternatives that address several business issues or hindrances. The different alternatives were evaluated using the following criteria: 1) net cash flow generated; 2) ease of implementation; 3) perceived effectiveness; 4) degree of risk; and 5) attractiveness to farm personnel. The recommended alternative is to extend the farm operation into lechon retailing which will be registered as another Namnama business.

An implementation plan for the recommended alternative was prepared. It included the schedule of resource requirements and activities and the contingency plan. Furthermore, marketing strategies focusing on the seven P’s of the proposed lechon business were also prepared. With proper implementation and marketing of the proposed lechon business, NPF will be able to realize a significant impact on its marketing, production, personnel, and financial aspects.

The relationship of NPF, NE, and NSAIC are said to be harmonious. Also, NE takes a great part in the value chain of NPF. The implications of the relationship in relation to the proposed lechon business are: 1) proper programming or scheduling of activities or resources; 2) emphasis on cooperation and for-the-greater-good values; 3) review of organizational structure; and 4) review of management succession issues.

Language

English

Location

UPLB College of Economics and Management (CEM)

Call Number

LG 993 2010 M17 C78

Notes

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Document Type

Thesis

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