Bad news brings good tidings to Cebu cooperative

Bad news brings good tidings to Cebu cooperative

By Tina Arceo-Dumlao
Philippine Daily Inquirer
First Posted 21:38:00 06/28/2008

CEBU CITY -- THE WORLD CAME crashing down on the laborers of Pacific Traders and Manufacturing Corp. in 1997 when the Cebu-based furniture and wood products export company told them the grim news that it was letting them go because it could no longer pay their wages.

The Asian currency crisis was taking its toll and Pacific Traders saw its costs escalate and export orders dwindle to the point that it would have to drastically pare its operating expenses if it wanted to survive, thus the decision to retrench over a hundred of its workers.

But the Mandaue City-based Pacific Traders threw the retrenched workers a lifeline when it encouraged them to group together into a cooperative and become labor subcontractors.

This means that they will do what they have always done—produce proudly Cebu-made furniture for the export market—but no longer as direct employees with benefits and privileges.

Only 55 of the 120 workers let go by Pacific Traders took up the challenge to get a cooperative off the ground. Looking back, they said it was the best decision they had ever made.

That’s because today, the cooperative of weavers, sanders, sample workers, cutters and jig makers put up with a P100,000 seed capital from Pacific Traders and P25,000 from the separation pay of the workers has evolved into one of Cebu’s strongest with an asset size of over P15 million. And the original membership of 55 has grown to 1,000 and still growing.

The journey, however, was fraught with seemingly insurmountable challenges.

According to 40-year-old Alvin T. Monzolin, a weaver of Pacific Trader and founding chair of the cooperative, the members went through an emotional roller coaster during the first few years, as they had to overcome feelings of inadequacy and pessimism.

Since none of them finished college, they thought they did not have what it takes to come together and pursue a common goal. But they managed to dig deep into their hidden reserve of strength and tenacity and get the Tabok Workers’ Multi-Purpose Cooperative, named after a barangay in Mandaue City, up and running.

What cemented their bond were the primordial need to survive and the realization that they had before them the unique opportunity to better their lot. They just had to grab it.

Crucial to their overcoming their early jitters was the leadership and capability-building training provided by the Philippine Business for Social Progress, of which Pacific Traders is a member, through its Metro Cebu Workforce Development Program.

The program was born out of the need in 1998 to help give new life and purpose to the workers of Cebu who were retrenched following the Asian currency crisis that badly hit the export companies of the province.

Unemployment at that time hit as high as 14 percent and PBSP believed that forming strong cooperatives was a viable solution and the Tabok cooperative became the first project under the WDEP.

Tabok has certainly lived up to its promise, thanks to the hard work of the members.

“What we would do was work the whole day and then attend trainings at night, practically every day from six in the evening to 11 or 12 midnight,” says Monzolin in Cebuano, “we were eager to learn.”

Their efforts did not go to waste as they learned valuable skills such as simple accounting, capital build-up techniques, computer literacy and leadership that they needed to ensure the steady and sure growth of the cooperative.

Monzolin says once the momentum was there, it was not hard to get members to join the cooperative, mainly because only members were allowed to work for Pacific Traders.

But then the cooperative imposed standards and that was difficult for many applicants to understand.

Monzolin says the initial thinking was that members just had to pay the membership fee and they would get in. But the members realized that they had to ensure that their work was of top quality if the cooperative was to become synonymous with high standards and get the clients they need.

As word of the quality of their work spread, so did their client base. From Pacific Traders, Tabok today services a number of furniture export companies, whose businesses flourished again as the global economy recovered from the debilitating effects of the Asian currency crisis.

Monzolin says that the cooperative gets between P300,000 and P400,000 worth of job orders every month and signs abound that the orders would further increase as more furniture companies tap the Tabok members’ unique skills.

He adds that the members invested back into the cooperative any earnings they generated from their subcontracting business, enabling the cooperative to diversify into other lines of business, such as extension of multipurpose loans and a cooperative store where the members get their basic commodities, such as rice and school supplies.

Monzolin says the members still can not believe how far they have gone from those dark, uncertain days when they did not know where their next meal would come from.

But even then, he says the members still dream big dreams, and one of those is to eventually be able to produce a line of furniture that they could export themselves—evolve, in other words, from a subcontractor to an exporter.

Monzolin says the members feel they could do it since they have years of experience in the export furniture industry and they are up to the stringent quality standards exposed by the top exporters.