THE CUMABAO, NAMNAMA, CAMASI, DY-ABRA – EAST-WEST SEED GROWERS MULTIPURPOSE COOPERATIVE

CREDIT PROGRAM: A CASE STUDY

EDUARDO C. NARAG

Submitted to the Faculty of Provincial Technical Institute of Agricultureat Isabela State University, Cabagan, Isabela in

partial fulfillment of requirements for the degree

BACHELOR OF SCIENCE IN AGRIBUSINESS

APRIL 2015

APPROVAL SHEET

This research study entitled “THE CUMABAO, NAMNAMA, CAMASI, DY-ABRA – EAST-WEST SEED GROWERS MULTIPURPOSE COOPERATIVE CREDIT PROGRAM: A CASE STUDY”, prepared and submitted by EDUARDO C. NARAG, in partial fulfillment of the requirements for the degree BACHELOR OF SCIENCE IN AGRIBUSINESS, is hereby recommended for approval.

DONNIE C. BACUDAdviser

________________Date

Accepted by the panel of examiners with the grade of PASSED

DONNIE C. BACUDChairman

______________Date

GERRY Z. LAGGUI LAZARINE T. MAMAUAGMember Member

______________ ______________Date Date

APPROVED

DONNIE C. BACUD MARIVIC H. DELA PAZChair, Department of Agribusiness Research Coordinator ______________ ______________

Date Date

SAMUEL R. SIMON, Ph. DDean, PTIA

______________Date

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BIOGRAPHICAL SKETCH

The author was born on January 02, 1989 at San Nicolas, Delfin Albano, Isabela.

He is the third child among the four children of Mr. Esmundo P. Narag and Mrs. Belen C.

Narag.

He studied and finished his elementary and high school education at San Nicolas

Multi-Grade Elementary School in 2001and San Antonio National High School in 2005,

respectively.

Through the blessings of the Almighty God and with the support of his loving

parents, he pursued his college education at the Provincial Technical Institute of

Agriculture (PTIA), Isabela State University (ISU) – Cabagan Campus, with the degree

of Bachelor in Science in Agribusiness (BSAB). Due to his desire to attain his goals in

life and the support of the people around him, he successfully complied with all the

requirements of the degree and is now a candidate for graduation for the school year

2014-2015.

EDUARDO C. NARAG

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ACKNOWLEDGMENT

The author would like to take this opportunity to express his profound gratitude

and deep regards to the persons who made this work possible.

To Prof. Donie C. Bacud, his Technical Adviser, for his valuable support,

suggestions and recommendations for the improvement of the study;

To Prof. Lazarine T. Mamauag, his Class Adviser, for her motherly guidance and

care;

To Dr. Richard C. Ramirez, Executive Officer; Dr. Samuel R. Simon, PTIA Dean;

Dr. Bella T. Reyes; Prof. Lolita M. Ramirez; Prof. Gerry Z. Laggui; Prof. Marivic H.

Dela Paz; Prof. Alan V. Bautista; All PTIA Faculty and Staff, for their administrative

support and for the knowledge, learning and skills they are imparted;

To the Members of the Cumabao, Namnama, Camasi, Dy-Abra – East-West Seed

Growers Multipurpose Cooperative, specifically the Management Staff, Manager Sheryl

P. Balucas, Madam Judilyn Ayun, Madam Marilyn Dumaliang, and Madam Leilanie

Balbin, for allowing him to conduct his OJT and for the good relationship which inspired

him more to do his work in the cooperative;

To his dearest father, Mr. Esmundo P. Narag for his love, endless support,

understanding and sacrifices;

To his beloved brother and sisters, Domingo, Binancia and Sheryl, for their

financial support and for being good brother and sisters all the time;

To his friends Jm, Adriano, Rene, Jerome, Rodney, Jake, Henry, Mhac, Rudy, Vic

and Zhar whom he laughed with and for being there always whenever he needs a person

to lean on; and

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Above all, to our Almighty God, for the wisdom, blessings, strength, guidance

and protection as he continues his journey in life.

EDUARDO C. NARAG

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TABLE OF CONTENTS

Page

TITLE PAGE i

APPROVAL SHEET ii

BIOGRAPHICAL SKETCH iii

ACKNOWLEDGMENT iv

TABLE OF CONTENTS vi

LIST OF FIGURES viii

LIST OF TABLES viii

LIST OF APPENDICES viii

ABSTRACT ix

CHAPTER I. INTRODUCTION 1

CHAPTER II. OBJECTIVES OF THE STUDY 4

CHAPTER III. METHODOLOGY 5

CHAPTER IV. INDUSTRY NOTES 6

CHAPTER V. CASE PROPER

A. Historical Background 8

1. Vision 9

2. Mission 9

B. Organization 10

C. Production 17

D. Marketing 17

E. Finance 18

F. Future Plans 21

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CHAPTER VI. PROBLEM IDENTIFICATION AND ANALYSIS

A. Possible Problem Areas 22

B. Problem Analysis 22

C. Identified Problems 26

D. SWOT Analysis 26

CHAPTER VII. ALTERNATIVE SOLUTION AND EVALUATION

A. Alternative Solution 28

B. Decision Criteria 30

CHAPTER VIII. DECISION/RECOMMENDATION 31

A. Operational Plan 32

1. Implementation Plan 32

2. Contingency Plan 33

APPENDICES 34

EXHIBITS 56

LIST OF FIGURES

Figure No. Title Page

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1 CNCD – East-West Seed Growers MPC Organizational Structure

16

2 Implementation plan of solution in the problem 33

LIST OF TABLES

TableNo. Title Page

1 Price lists of seeds produce per kilogram 18

2 Summary of CNCD–MPC Financial Ratio 21

3 Actual performance of CNCD–MPC Credit Program as of February 2015

25

4 2012 and 2013 average collection period of accounts receivable 25

LIST OF APPENDICES

Appendix No. Title Page

1 CNCD – East-West Seed Growers MPC List of Officers 35

2 Cooperative Policy 36

3 2012 and 2013 Audited Financial Statement 43

4 Cost and Return Analysis of Ampalaya Seed Production 54

THE CUMABAO, NAMNAMA, CAMASI, DY-ABRA – EAST-WEST SEED GROWERS MULTIPURPOSE COOPERATIVE

CREDIT PROGRAM: A CASE STUDY

viii

EDUARDO C. NARAG

ABSTRACT

The Cumabao, Namnama, Camasi, Dy-Abra – East-West Seed Growers

Multipurpose Cooperative (CNCD-MPC) is a cooperative engaged in marketing and

credit operations. The CNCD-MPC is a brainchild of the East-West Seed Company

(EWSC) to act as a conduit among its hybrid seed growers in Tumauini, Isabela. CNCD-

MPC was also established to facilitate the distribution of assistance needed by the farmer

members coming from East-West. Although it seems that the cooperative is doing well in

its businesses due to the fact that they have a captured market and that they have the full

support of EWSC, there are signs that the cooperative is struggling financially such as

their inability to pay their debts on time and the piling up of past dues and inactive loans.

Thus, there is a need to analyze the loan program implementation and the financial

position of the cooperative. The type of research is a case study using qualitative and

quantitative analysis. Qualitative analysis was used on the evaluation of the program

guidelines and its effect on repayment while quantitative/financial analysis was used in

evaluating the financial position of the cooperative. The quantitative data used in this

research was the audited financial statements of the cooperative. The result of the study

revealed that the cooperative has poor ability to collect accounts receivable caused by

insufficient number of staff. This resulted to an increase rate of delinquent clients/past

due accounts and consequently, insufficient budget to finance the needs of their farmer

growers. Based on the weighted decision criteria, strict monitoring and implementing

policy guidelines is highly recommended. A revised loan program was also proposed to

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address some weakness of the current loan programs. CNCD-MPC has all the needed

assets to function profitability, merging these assets to work effectively and efficiently

will make the cooperative a success.

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