Essay On Problems Faced By Small Scale Industries In Philippines - Essay for you

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Essay On Problems Faced By Small Scale Industries In Philippines

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Essay on problems faced by small scale industries in philippines

Appendix 6
Livestock in food security in the Philippines

The livestock industry in the Philippines has two distinct sectors. The small-scale semi-subsistence sector and the commercial sector. The commercial sector relies on the importation of feed and generally operates intensive production systems involving poultry, pigs and beef feedlot production. In the beef feedlot industry virtually all the feeder animals are imported. The bulk of the feed used to supply the pig and poultry industries is also imported. Pork is the most popular meat and 60-65% of meat eaten in the Philippines is pork

The large ruminant industry has three components: (1) buffalo (draught, milk and meat); (2) beef cattle; and (3) dairy cattle. The buffalo or carabao industry is composed of 97% backyard farming and 3% commercial farming. Backyard farmers use buffaloes for draft(95%), milk(5%) and meat. Buffaloes are required to be over 7 years old before slaughter if male and over 11 years if female.

The industry has shown negative growth rates. However, the Bureau of Animal Industry (BAI) says that this was reversed recently, with numbers adjusted up to 2.8 million. The Carabao Center was created in 1982 and until 1993 received support from UNDP. Inadequate breeding stock requires importation to upgrade and increase numbers. However, a need exists to increase support services as reduced numbers and high slaughter rates threaten draught power availability.

About 85% of the cattle in the beef industry are comprised of backyard enterprises. This will require regional restructuring due to spreading urbanisation. Backyard growers rely on farm waste for feed supplies. Feeds used by the commercial beef raisers are based largely on silage (75 day corn chop), sugarcane tops and chopped sugarcane with rice bran and copra meal, tapioca, pineapple pulp, local cotton seed meal, wheat pollard and brewery spent grain. The amounts fed fluctuate with price availability and acceptance by the cattle, the feeds being introduced slowly and continually monitored for performance and rations being modified to ensure at least 1 kg/day growth.

All feedlot cattle are imported and fed over a period from 90 to 120 days. They are sold when they reach 380-400 kgs. Cattle over 450 kg are penalised in the market place as they become difficult to process.

A 1996 study of the Institute of Agribusiness Development and Policy, University of Asia and the Pacific forecasts a continuing 4% increase in demand for beef but growers will have to rely on imports as few local cattle are available. Locally bred cattle appear to be finished for slaughter on the property of origin. The owners make use of feeds, often to supplement sugarcane tops or growing and cutting Leucena as a supplement.

With the decline in cattle numbers in Luzon and generally in commercial herds, feedlots rely virtually totally on imports of Australian steers for fattening. Approximately 192,000 heads of cattle were imported in 1995 for feedlot production

Factors that contribute to low cattle numbers are land tenure insecurity, inadequate support systems, marketing and transport infrastructure. Local feed resources are not well exploited although industrial byproducts, sugarcane tops and other crop residues are used widely. There is also inadequate population livestock base for breeding, which leads to the inability of natural increases to keep pace with the high level of marketing. The livestock are of generally poor quality, including the imports

The dairy Industry is 65% smallholder and 35% commercial dairy. Domestic production accounts for is less than 1% of supply. The industry is practically non existent except in the highlands where the local demand is met by some small dairy enterprises.

Markets are poorly developed and there is virtually no marketing as there is a very large import of milk products from Australia and New Zealand. Cooperatives exist and there is substantial unused capacity in the local processing industry.

The swine industry produces 1.2 million tonnes of pork annually. The backyard industry accounts for 83% of the swine population and commercial operators account for 17%. Swine marketing needs to be overhauled as "agents" now move about buying individual animals, often not giving a fair price. If FMD is declared in a region, agents focus on that affected region and substantially devalue prices.

The commercial enterprises are intensive, and have high turnovers with tight profit margins usually integrating feed supply, processing and marketing with production. There is concern about rising costs of feeds, leading to efforts at seeking feed substitutes and liberalisation of imports of livestock feeds. Some operators allegedly escape duties on feeds by using grains imported free of duty for human consumption. They are also seeking exemption from CARP to establish more stable sources of local feed supply.

The poultry industry is largely composed of small scale producers. It is estimated that 70% of the birds are kept in backyard enterprises and 30% in commercial operations. In general commercial broiler operators are contracted by feedmills to raise the birds.

Native chickens are used by the smallholder farmers and hybrids by commercial intensive farmers who integrate feed supply, processing and marketing with production. Feeds are virtually fully imported, being yellow maize and soybean meal, although copra meal and rice bran is substituted to some extent

Concerns are about rising costs of feeds and competition with imported birds from Thailand; the lack of development of local feed supplies and the consequent efforts at liberalisation of imports of feeds. Poultry disease management is also a concern; village and smallholder chicken farmers suggest the use of V4 Newcastle Disease Vaccine.

Ducks are commonly a part of mixed farming enterprises. They are used to gather grain from rice fields after they are harvested.

Small ruminants, particularly goats, are either kept by smallholder farmers or more intensively on government farms. The goat population has shown a steady rate of increase (a five-fold increase since 1961), following an increase in market demand for goat meat as well as its milk and fibre. They are used extensively by the backyard enterprises and the rural poor who make use of marginal lands so that health management is often at a low standard. Improved support services with improved quality breeding stock are required. Heifer International and other NGOs have a programme where they provide good quality goats, specifically 6 does and a buck, as a model. Feed and housing have to be available and the repayment consist of two kids per doe. Goats are generally grown on slats or tethered out.

Sheep have a very small population base.

Commercial pig and poultry feeds compete with the human population for cereals. The rations are composed mainly of 50% maize and 25% soybean. Yellow maize (5-8% of which is imported) at a cost of P5-8/kg while the entire soybean supply is imported. Soybean costs P 9-11/kg. Rice bran and pollard make up the rest of the diet with copra meal, fish meal being replacement components for soybean when available.

Fish meal is an offal by-product and is available at a reasonable price, but lacks in quality. Sorghum and canola meal have anti-nutritional factors so are fed in small amounts. Meat and bone meal, rendered poultry products, which include feathers, are used when available but rendering is not universally practiced due to energy requirements and cost.

Other feeds are corn gluten, wheat pollard, brewery grain and yeast. There is an increasing supply of tapioca, sweet potato and molasses as sources of carbohydrate. Banana meal fibre and pineapple pulp, although sufficient in quantity, is more useful to ruminant nutrition. Backyard swine and poultry nutrition relies largely on swill and scavenging although ducks are commonly fed on rice stubble to eat snails and fallen rice heads and the manure is also seen as a benefit.

Swine raisers in different regions have buying advantages when it comes to stock feeds, for example, those in Central Luzon where Region II corners all the feed. Desiccated sweet potato is grown but is exported to Taiwan as it is owned by overseas interests. Substitutes for sweet corn are being sort and the Department of Agriculture has been approached to establish a laboratory process to test a mixture of sweet potato and copra cake and establish grower cooperatives to supply the product.

The expected yield of sweet potato is 20-40 tonnes/ha using developed varieties. To look at the feasibility and establish the process as a viable commercial enterprise as a corn substitute.

Conversion ratios achieved are 2.8-3.0 for swine and about 2.0 for poultry. Note that when village chickens give a very poor conversion which might mediate against intensifying village poultry without improving breed performance. Swine in prime condition sell for P55-60/kg liveweight while the culls sell for around P45/kg liveweight. About 15% of the swine meat is processed but as this is increasingly imported, this demand is falling off

Threats to the swine and poultry industry arise from uncertain costs of feed. The increase in corn production is 1.2% per year, while that from livestock (swine and poultry), 5-7%. A feedlot cartel is growing silage to reduce its need for corn

Disease was not seen as a threat to the survival of either the swine or poultry commercial livestock industries as the level of management was able to combat all of the significant disease problems. The biggest problem identified was reduced profit margins due to increased animal feed costs Even in the backyard swine enterprises, disease was not seen as a priority as management systems were available to counter these. Diseases listed in order of priority were: (1) swine fever; (2) foot and mouth disease; and (3) pseudo rabies (Aujeszky's disease).

The backyard poultry industry has the following problems in order of priority: (1) avian pests and parasites,; (2) Newcastle disease; and (3) fowl cholera.

The backyard cattle industry faces the problems of (1) foot and mouth disease and (2) asteurellosis.

Waste control is not an issue in the Philippines although two rivers have been declared officially dead. By-product rendering, although producing a valuable product, is not well established and there is a big variation in the quality of the product. An agency should look towards the more efficient utilisation of by-products. Liquid wastes do not receive enzyme treatment to reduce phosphates, and are therefore emerging as a serious problem.

Trade issues are emerging, with the WTO and GATT pushing for tariff reduction. Poultry from Thailand will be a threat to commercial producers unless the tariffs on feed imports are also reduced. Flour millers are able to import wheat with minimum tariff and this can find its way into substitute corn and soy but is supposed to be for human consumption.

Government policies have not been able to assist livestock owners. In June 1988 the Comprehensive Agrarian Reform Programme (CARP) was introduced. Under this programme, landholders with more than 5 ha would have their land subdivided and given to the "landless." Due to lack of skills and resources on the part of the landless people, large tracts of land went out of production. Some of the new landholders speculated on their new land in the hope of quick financial gain. There is now legislation as CARL. Landholders in the more remote areas such as on Mindanao, away from government enforcement, can now protect their land more easily.

All the other ASEAN countries permit animal feed imports with low tariffs. Thus they are able to produce pigs and poultry at lower prices. Corn imported for animal feeds - that is, yellow corn - attracts a tariff of 35% if it falls within minimal access volume (MAV). Beyond this, the tariff is 100%. The processing of sweet potato holds the greatest promise using 15% soybean meal for protein content. Rice hull chicken litter with 30% copra meal or rice bran has been used to feed cattle. This is fed with mineral premixes and molasses plus grass and rice straw have achieved weight gains of 2kg/day are achieved with a superior quality meat.

Constraints to livestock production in the Philippines

Constraints to improving livestock production are the following: (1) livestock nutrition with MAV applying to feed imports and not significantly more to establish substitute feeds; (2) livestock health and the need to eradicate FMD to permit the free movement of livestock from Luzon; (3) lack of security of land tenure; (4) urbanisation; (5) land use priority for cropping; (6) marketing and poor transport infrastructure; and (7) cattle rustling (theft).

Other concerns were the following: (1) fragility of the upland environments; (2) very poor infra structure support; (3) labour is moving to the cities; and (4) efficiency of national resource management.

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Marketing Problems Of Small-scale Indigenous Pharmacultical Manufacturing Companies In Nigeria

Marketing Problems Of Small-scale Indigenous Pharmacultical Manufacturing Companies In Nigeria

This work was on the marketing problems of small-scale indigenous pharmaceutical manufacturing company in Nigeria (a case study of Encristo Pharmaceutical Industry Nigeria Limited, Enugu).

The researcher setout with the following objectives.

To find out if quality of products is a problem to Encristo Pharmaceutical Industry.

To find out the inadequate capital of the company and how it affects the marketing activities of Encristo Pharmaceutical industry, amongst others.

Four hypothesis were formulated. A review of related literature was also done to expose the researcher to what has been previously done to ensure a sound basis for the research.

A structured questionnaires were developed and administered by the researcher to staff and management, and customers/consumers of Encristo pharmaceutical industry products.

Chi-square was used to test the four hypothesis formulated.

The following findings were made the Encristo pharmaceutical industry have marketing problems, funds inhibit their expansion.

That the marketing problems of Encristo pharmaceutical industry as a small-scale industry include lack of finance, supply of enough quantity of raw materials, laboured managed problems, marketing/promotional problems. Until the government and management of small-scale industries including Encristo pharmaceutical industry wake up to the challenges facing them, small-scale industries cannot survive and flourish in sufficient numbers to complete the industry of the future.

The following recommendations were made.

The Encristo pharmaceutical industry should improve on t heir products performance by making use of research work.

The government should wake-up to their responsibilities by providing all the necessary requirement for the survive of small-scale industries in an ever dynamic marketing environment.

The researcher strongly believes that if these recommendations are carried out the Encristo pharmaceutical industry will serve their customers better and at a profit.


With the turn of economic events brought about by the structural adjustment programme (SAP) of 1985 – 1993, Nigerians were challenged to adopt their own technology and establish indigenous business other wise known as entrepreneurship.

Nigerian government introduced the indigenization decree in the 1970’s banning the whole ownership of certain categories of business by foreigners. (Ebue, 2001; 16). The essence of mapping out this objectives was to improved the technology/technical skills, making provision for business management, training, development of women’s skills in food processing, and energy saving and lobbies for training opportunities relevant to small-scale industries.

The comprehensive definition of small-scale industries/business was given by (Ani 1999; 4) derail as owned, managed by one or two persons, influenced by the family in decision making, has no undifferentiated organizational structure, market share is small and employ less than fifty (50) persons.

The small-scale industries in Nigeria are faced with a lot of problems such as lack of initial capital to start up the business, low standard of production which bring about great lost in business and the incapacitation level of local machines and indigene technology which have not gone far to challenge the modern technology. This implies that Nigerian small-scale industries have to struggle for survival in the midst of sophisticated and highly equipped foreign competitors who have so influenced the Nigerian consumers to look down on made in Nigeria goods or products.

The Encristo Nigeria Limited manufacturer of liquid preparations is owned by Chief I.O. Meregim. The company Encristo Nigeria Limited manufacturers was established in the year 1994. The nature of the company is fully a sole proprietorship. The industry was being managed by the family which Chief Meregim is the Chairman and the Chief Executive.

He started his business life right before the Nigerian civil war and ever since then he had an immense growth in import and export business.

Construction, estate trading and pharmaceutical business. His wife has being of a great help to him by sharing her experience as an entrepreneurial and manufacturing business inclination. This has contributed largely to the growth of the company.

The company which in due time started immediately after inception started full operation on 1st June, 1994 with a foundation staff numbering 19, he also in the proper way registered by the National Agency for Food and Drug Administration Control (NAFDAC), pharmaceutical council of Nigeria, Manufacturers Association of Nigeria (MAN) and Pharmacist Manufacturing Group (PMG).

The company’s activities are being directed from its operative heading quarters located at No.8, 2nd Avenue, Independence Layout, Enugu and it is also from here that other sections of Encristo Industries since inception has invested heavily on the manufacturing of liquid drugs, otherwise liquid preparations. The products to the credit of the company’s brand name are includes: -

Cristolyn (cough syrup) Cristom (blood tonic) Ecristo (multivitamin) Cristumal (paracitamol) and Cristoquine (chloroquine).

These products are bottled in both 60ml, 100ml and 200ml amber bottle and 2litres plastic containers (hospital packs) and above.

The company’s giant step has being a contribution to the much desired improvement in the care delivery in Nigeria and to supplement the high demand and consequent importation of drugs which has been on the rise and treat to the national foreign reserve. Moreover, imported drugs have been on the high price side heavily concentrated with unrefined chemicals capable of dangerous after use reactions and affects.

As time goes on the number of the employees or staff has increased to 35 including managerial supervisors assistant manager and operatives.

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10 Major Problems faced by the Small Scale Industries of India

10 Major Problems faced by the Small Scale Industries of India

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Major problems faced by the small scale industries are. (1) Finance (2) Raw Material (3) Idle Capacity (4) Technology (5) Marketing (6) Infrastructure (7) Under Utilisation of Capacity (8) Project Planning!

Small scale industries play a vital role in the economic development of our country.

This sector can stimulate economic activity and is entrusted with the responsibility of realising various objectives generation of more employment opportunities with less investment, reducing regional imbalances etc. Small scale industries are not in a position to play their role effectively due to various constraints. The various constraints, the various problems faced by small scale industries are as under:


Firstly, adequate funds are not available and secondly, entrepreneurs due to weak economic base, have lower credit worthiness. Neither they are having their own resources nov are others prepared to lend them. Entrepreneurs are forced to borrow money from money lenders at exorbitant rate of interest and this upsets all their calculations.

After nationalisation, banks have started financing this sector. These enterprises are still struggling with the problem of inadequate availability of high cost funds. These enterprises are promoting various social objectives and in order to facilitate then working adequate credit on easier terms and conditions must be provided to them.

(2)Raw Material:

Small scale industries normally tap local sources for meeting raw material requirements. These units have to face numerous problems like availability of inadequate quantity, poor quality and even supply of raw material is not on regular basis. All these factors adversely affect t e functioning of these units.

Large scale units, because of more resources, normally corner whatever raw material that is available in the open market. Small scale units are thus forced to purchase the same raw material from the open market at very high prices. It will lead to increase in the cost of production thereby making their functioning unviable.

(3)Idle Capacity:

There is under utilisation of installed capacity to the extent of 40 to 50 percent in case of small scale industries. Various causes of this under-utilisation are shortage of raw material problem associated with funds and even availability of power. Small scale units are not fully equipped to overcome all these problems as is the case with the rivals in the large scale sector.


Small scale entrepreneurs are not fully exposed to the latest technology. Moreover, they lack requisite resources to update or modernise their plant and machinery Due to obsolete methods of production, they are confronted with the problems of less production in inferior quality and that too at higher cost. They are in no position to compete with their better equipped rivals operating modem large scale units.


These small scale units are also exposed to marketing problems. They are not in a position to get first hand information about the market i.e. about the competition, taste, liking, disliking of the consumers and prevalent fashion.

With the result they are not in a position to upgrade their products keeping in mind market requirements. They are producing less of inferior quality and that too at higher costs. Therefore, in competition with better equipped large scale units they are placed in a relatively disadvantageous position.

In order to safeguard the interests of small scale enterprises the Government of India has reserved certain items for exclusive production in the small scale sector. Various government agencies like Trade Fair Authority of India, State Trading Corporation and the National Small Industries Corporation are extending helping hand to small scale sector in selling its products both in the domestic and export markets.


Infrastructure aspects adversely affect the functioning of small scale units. There is inadequate availability of transportation, communication, power and other facilities in the backward areas. Entrepreneurs are faced with the problem of getting power connections and even when they are lucky enough to get these they are exposed to unscheduled long power cuts.

Inadequate and inappropriate transportation and communication network will make the working of various units all the more difficult. All these factors are going to adversely affect the quantity, quality and production schedule of the enterprises operating in these areas. Thus their operations will become uneconomical and unviable.

(7)Under Utilisation of Capacity:

Most of the small-scale units are working below full potentials or there is gross underutilization of capacities. Large scale units are working for 24 hours a day i.e. in three shifts of 8 hours each and are thus making best possible use of their machinery and equipments.

On the other hand small scale units are making only 40 to 50 percent use of their installed capacities. Various reasons attributed to this gross under- utilisation of capacities are problems of finance, raw material, power and underdeveloped markets for their products.

(8)Project Planning:

Another important problem faced by small scale entrepreneurs is poor project planning. These entrepreneurs do not attach much significance to viability studies i.e. both technical and economical and plunge into entrepreneurial activity out of mere enthusiasm and excitement.

They do not bother to study the demand aspect, marketing problems, and sources of raw materials and even availability of proper infrastructure before starting their enterprises. Project feasibility analysis covering all these aspects in addition to technical and financial viability of the projects, is not at all given due weight-age.

Inexperienced and incomplete documents which invariably results in delays in completing promotional formalities. Small entrepreneurs often submit unrealistic feasibility reports and incompetent entrepreneurs do not fully understand project details.

Moreover, due to limited financial resources they cannot afford to avail services of project consultants. This result is poor project planning and execution. There is both time interests of these small scale enterprises.

(9) Skilled Manpower:

A small scale unit located in a remote backward area may not have problem with respect to unskilled workers, but skilled workers are not available there. The reason is Firstly, skilled workers may be reluctant to work in these areas and secondly, the enterprise may not afford to pay the wages and other facilities demanded by these workers.

Besides non-availability entrepreneurs are confronted with various other problems like absenteeism, high labour turnover indiscipline, strike etc. These labour related problems result in lower productivity, deterioration of quality, increase in wastages, and rise in other overhead costs and finally adverse impact on the profitability of these small scale units.


Managerial inadequacies pose another serious problem for small scale units. Modern business demands vision, knowledge, skill, aptitude and whole hearted devotion. Competence of the entrepreneur is vital for the success of any venture. An entrepreneur is a pivot around whom the entire enterprise revolves.

Many small scale units have turned sick due to lack of managerial competence on the part of entrepreneurs. An entrepreneur who is required to undergo training and counseling for developing his managerial skills will add to the problems of entrepreneurs.

The small scale entrepreneurs have to encounter numerous problems relating to overdependence on institutional agencies for funds and consultancy services, lack of credit-worthiness, education, training, lower profitability and host of marketing and other problems. The Government of India has initiated various schemes aimed at improving the overall functioning of these units.