“COMMON sense,” says Ramon “Chin Chin” Uy Jr., 32, founder of Fresh Start Organics in Bacolod City.
“Many agricultural companies want instant profit so they use chemical fertilizers to get as much as possible, as quickly as they can, from the land. Products are sold commercially, but what you do not see is the destruction of the soil that does not rest. The soil is acidified and dead. Do you think these same companies clean up to restore the soil? Not really.”
Fresh Start is not the usual family business, and Chin Chin not the stereotypical head. He regrets not taking his studies seriously and dropping out of college. The family business of his parents, a foundry, was in trouble, so in 2005, Chin Chin and his wife Francine knew they had to scout for a viable enterprise.
The couple started with an organic fertilizer business, primarily based on vermicomposting (using earthworms to fertilize the soil). Crops grown using their natural fertilizer were bigger and healthier than those planted using chemical pesticides, so during an organic fair, demand for their product soared.
“We saw a future in organic farming,” says Chin Chin. “People thought we were crazy, since conventional fertilizers were cheap at that time. But we believed in our organic crops.”
In 2006, world oil prices shot up, and with them, the cost of chemical fertilizers (“seven-fold increase,” says Chin Chin). Fate finally smiled on the couple, and when Robinson’s Bacolod offered them a chance to sell organic produce, “it was a choice between staying small or growing our customers. We took the risk. In the first week, our products sold out.”
Chin Chin decided to partner with others in Negros. “Instead of quarrelling among ourselves, we decided to cooperate because we have the same goal.” As the president of the regional organic farming association, Chin Chin ensured that Fresh Start gives advice and training, even to other parties who might compete.
“We give back. When we were starting out, many people also helped us.”
Three kinds of profit
Most businesses, whether family-based or otherwise, exist to make money.
“For us, profit is three-fold: environmental, social, economic. We make sure that our practices do not harm, and in fact, preserve the environment. We want our stakeholders, especially our partner farmers, to get a fair price for their efforts.”
“We do not [bargain]. We invite farmers to set prices for products, because they are the ones who know the material, labor costs, etc. Once prices are set, no more bargaining. We treat farmers well, and many say they earn more from our organic business rather than from bigger corporations that may not pay them on time, or only a fraction of what we do.”
“We earn our share. Everyone is happy. That’s the only way to sustain a business,” he said.
Chin Chin and his fellow organic farmers have made an impact on Negros. Well-read (a favorite book is Michael Pollan’s “Omnivore’s Dilemma”) Chin Chin cites facts and figures. Negros leads the nation in organic agriculture. Four percent of the farming area, more than 16,000 hectares, in Negros produce crops already certified organic. Organic coffee beans in Negros grown in the shade are more flavorful than those grown in sunshine, as is the case with Vietnam (“originally, cacao was grown in the rainforest”).
With more than 50 employees and several more partners, Fresh Start has an array of products sold in stores and restaurants in Bacolod: organic fruits, vegetables, coffee, rice, chicken; natural sweeteners, soaps, mouthwash, insect repellents, oils, sprays, and of course, fertilizers. Some products are sold in outlets such as Echo Store in Metro Manila.
Hidden costs
Chin Chin has great business savvy, but he rues his wasted college days. When the company began, “we made so many mistakes which we might have avoided had I known accounting, supply chain management, etc.” Chin Chin admits that he does not have formal expertise in these fields, so he hired professionals to fill in the gaps.
“At first we thought that getting a non-family Chief Operating Officer was costly, but we knew we needed him. Our goal is to professionalize by creating systems and procedures so that even if, for example, I take off for a year, things will still run smoothly. The traditional way of doing things, which is one person doing everything, from checking the finances to overseeing products and everything else, cannot be done if we want to grow.”
“Sometimes, I micro-manage,” Chin Chin says. “If I see my wife doing the accounts, I stop her and ask the accountant to do them. I remind her that systems are in place.”
Going organic has clear health benefits, but many organic products have exorbitant prices. Middlemen buy organic produce from farmers dirt cheap and sell this at supermarkets or malls at costs several times higher.
“We want to eliminate the middleman, and give to customers and producers alike a fair price.”
Organics requires changing the mindset of farmers who want a quick profit. Since supply cannot yet meet the demand, prices are high. “We are working to make more farmers adapt healthy practices, so that in 10 years, organic will be the conventional way.”
The higher prices account for the hidden costs of organics. “If you pay a cheap price for fast food now, you will pay a higher price later on, in terms of medicine for your ill health. You also pay the price for environmental destruction. The higher prices for organic foods now take into account the costs to maintain your health and the health of the land to be preserved for future generations.”
Chin Chin’s friend, Edgardo Uychiat of Negros Island Sustainable Agriculture and Rural Development Foundation Inc., says that their group is “looking for ways to make organic produce affordable for the public.”
The best part of working in a family business? “You get to control every aspect and things are transparent. Any worker, farmer, employee can examine all our records to see that things are in order.”
The worst part? “Unprofessionalism of family members; some are too set in the old ways and find it hard to change. We need problem solvers, change makers, in business not only for profit but also to help society.”
“Corporate social responsibility (CSR) is not the answer. Companies may already have destroyed the environment or harmed society through whatever—poor mining, selling junk, harming clients, etc. Then they want to make up through CSR? Go beyond CSR. Think sustainably.”
Visit Fresh Start site at www.freshstartorganic.com or www.facebook.com/freshstartorganic. E-mail Chin Chin Uy at ramonuyjr@yahoo.com or ramonuyjr@gmail.com. Next week: A Constitution is not enough
(Queena N. Lee-Chua is on the Board of Directors of Ateneo de Manila University’s Family Business Development Center. Get her book “Successful Family Businesses” at the University Press (email msanagustin@ateneo.edu.) Email the author at blessbook.chua@gmail.com.)