Making It Big in Calamansi Juice Processing
Ask Fernando Esguerra of Las Pinas City, a former banker who is now a manufacturer and exporter of high-quality calamansi juice, and he would tell you it’s “the vision to broaden your market.” This, of course, needs hard work, good business sense, and receptiveness to appropriate technologies.
Fernando or Nandy, is the man behind the successful ‘Good Sense Lemonada’, which you find in the shelves of major supermarkets, grocery stores, country clubs, food establishments, health centers, and even at nearby retail stores in Metro Manila.
This entrepreneur, who started 11 years ago as a distributor of other brands of calamansi juice concentrate, now also exports to the United States Mainland, UK, Canada, Hong Kong, Guam, Hawaii, Australia, and New Zealand through consolidators and also under his own brand.
FROM DISTRIBUTOR TO MANUFACTURER
After five years in the distribution of calamansi juice, Nandy decided in 2002 to bring his small business to a higher level. He decided to make and sell his own brand of calamansi juice.
He went into manufacturing calamansi juice concentrate with an initial capital of P100,000 from his savings for the infrastructure and P8,000 for the raw materials.
He also changed the company’s name from Mapagmahal Distributors to Mapagmahal Foods to broaden the scope of the business as manufacturer, wholesaler, and retailer of non-alcoholic beverages.
INITIAL CALAMANSI JUICE PRODUCTION
Nandy recalled that the company started with a 290-square meter production area, with only weighing scales, burners and cooking pots made of cast iron. Its first product was calamansi juice concentrate.
Nandy relates that he did not sell his calamansi through bigger distributors because of the low product turnover based on his experience. Instead, he tapped schools and company canteens, sari-sari stores, and groceries in Metro Manila.
“We also lent some juice dispensers to school and office canteens as well as to small food establishments while we provided them the juice concentrate,” he added.
At a production capacity of 8,000 bottles (330 ml each) a month, the company was considered to be making good money from the business. But Nandy realized that their product then was no different from those of other calamansi juice processors in the market in terms of quality, taste, appearance, and shelflife which lasted for only three to six months.
The business was running that way when Nandy thought that they should do something to make their product more competitive. “We needed to have a better business strategy because not all of our contemporaries have remained in this industry. Most of them encountered losses and were not able to recover,” he said.
Opportunity came in 2004 when Nandy participated in the International Food Exhibition (IFEX) where he got good receptions from various consolidators and foreign visitors for his calamansi juice concentrate. However, they required him to have a good packaging and extend the product shelflife to at least a year.
Fortunately, Nandy came across the Small Enterprise Technology Upgrading Program (SETUP) of the Department of Science and Technology (DOST) that participated also in IFEX. SETUP addresses the technological needs of small- and medium-scale enterprises. It aims to add value to local products, create employment, generate income and alleviate poverty.
“We wanted to go into the export market and mechanize our production, but we knew we couldn’t do it so we approached the DOST National Capital Region for help,” he said.
That same year, Nandy was assisted by DOST Industrial Technology Development Institute Food Processing Division through SETUP in the form of technical assistance, consultancy services, product development and improvement, training on Good Manufacturing Practice, Hazard Analysis of Critical Control Points, and 5S. It also helped him in the acquisition of machineries.
Nandy noted a lot of improvement in processing method. First was the squeezing process which was maximized through the acquisition of a squeezing machine. He said that they used to squeeze the calamansi manually which took hours to finish.
They also said goodbye to their cast iron cooking pots which did not only limit their production capacity but also consumed more energy. Now, they are using the steam-jacketed kettle provided by SETUP that can produce bigger volume with less cooking time. Standard parameters are also controlled, resulting in better product quality and consistency.
The company has also acquired a product transfer pump and compressor to transfer the product in the bottling area in a faster, safer, and more hygienic way.
Filling and capping were also mechanized, making the process more aseptic and less labor-intensive.
Nandy swears that the above mentioned interventions have greatly improved the quality of their product and the productivity of the company.
For instance, the product shelf life has increased from 90 days to 1 year thus meeting the requirement of major buyers.
Volume of production has likewise increased to 21,660 bottles per month. “We realized an approximate increase of 130 percent in our gross sales amounting to P1.3 million per month,” he said.
In addition, Nandy said that in two days, they are now able to produce the volume which previously took them five days to make. “We have saved on overhead cost but because of the increase in our production volume, we employed additional two workers,” he said. The company now has a total workforce of 16 and a 1,000-square meter production area in Las Pinas City.
The company has also expanded its product line, which now includes Lemonada Calamansi Juice Concentrate, Lemonada Concentrate with Honey, Dalandan with Honey, Ready-to-drink Lemonada Calamansi Juice, Ready-to-drink Lemonada Tea, and Pure Calamansi Extract.
The developments that the company has achieved through SETUP have brought about 200 to 250 percent increase in clientele, according to Nandy. The export markets buy 40 percent of the total production, which Nandy considers as already good because of the increasing number of players in the local market.
Locally, products of Mapagmahal Foods are available in all branches of Rustan’s Supermarkets, all branches of SM Supermarkets (SM Bonus Brand), Landmark- Supermarket-Makati, Metro Gaisano-Market! Market!, Pioneer Supermarket-Mandaluyong, Value Point Supermarket (Las Pinas, Manila and Laguna branches), RFC Supermarket-Las Pifias, Fernando’s Supermarket-Las Pinas, Sunshine Supermarket-Baguio City, Teahouse Restaurant and I3akeshop-Baguio City, Escovado Tradings-Quezon City, Mapagmahal Ventures-Makati, and Shepherd Food Products-Las Pinas.
ADDING VALUE ON CALAMANSI
Nandy’s calamansi juice processing venture does not only put added value on calamansi, which is the most commonly grown among the citrus species in the country. It also helps local calamansi growers find a sure market for their produce.
The company, whose average volume requirement stands at 3 tons a week, mainly buys from the farmers in Mindoro and Quezon who are known for their good-quality citrus.
Although the price of calamansi is very unstable – it goes up to P60 and plunges to P5 per kilo, depending on the season – Nandy said that this does not affect the price of their product because they practice storing of calamansi extract whenever the price goes down.
For example, the company buys in bigger volume when calamansi sells at P5 to r10 per kilo and then extracts the juice (3 kilos of fresh fruits yield a kilo of extract). He said that when pure calamansi extract is stored in a cold storage, it could last up to one year and has the same quality with the fresh extract when processed.
At the time of our visit, Nandy said that the price of calamansi was at P55 per kilo. So he showed to us some of the stored extract that they will be using in order to offset the quantity of the fresh extract needed in the process. The result? Stable price of the product.
Mapagmahal Foods received in 2005 the “Best Lemon Juice Manufacturer for Metro Manila” in the National Product Quality Excellence Awards sponsored by the National Council for Product Service Quality, the Consumers Today Magazine, and the National Product Quality Excellence Awards. The company’s carrier brand `Good Sense’ was also recently cited by the Asia Pacific Awards Council as “2008 Outstanding Citrus Beverage Products Brand.”
Moreover, the company’s products have been certified Halal by the Islamic Da’wah of the Philippines.
GETTING MORE THAN WHAT HE THINKS
Mapagmahal currently enjoys a good market share which Nandy credits mainly to the help extended to them by DOST. He encourages small entrepreneurs who want to improve or start their business to avail themselves of assistance from DOST. By the way, his company is one of the 30,000 firms nationwide which have benefited from SETUP since 2004.
“We just wanted to be able to deliver a safe and affordable product. But with the assistance from DOST NCR, we were even able to deliver a better and more affordable one,” he ended.