Author: FALCOR MARKETING CORPORATION
ABSTRACT
Falcor Marketing Corporation, a Bacolod-based distributor of agricultural products, fertilizers, chemicals, dog food and the exclusive distributor of UNO feeds in Negros and Panay areas in the Visayas, was founded by Richmond Ho’s father and his business partners in 1988. It took a couple of years before Falcor Marketing branched out under Richmond’s helm. Expanding the business was a careful and deliberate process. It entailed diversifying their product lines from just fertilizers to other products, putting up branches outside of the city and increasing their human resource capacity by employing technical people who would assist their clientele in communities. As a result of their expansion, Falcor Marketing’s communication needs also increased. Thus they subscribed to Globe to fill in their communication requirements and this made their operations more effective and efficient. They saw the importance of having a business continuity plan. Apart from ensuring a good IT infrastructure for their business, they also ensured that people and process improvements remained at the core of their operations. They invested in boosting their image online, improving their customer service relations to encourage more loyal customers and expand their base, and upskill their employees through continuous training programs.
The Early Beginning
Richmond Ho was the vice-president of Falcor Marketing Corporation, a Bacolod-based distributor of agricultural products, fertilizers, chemicals, dog food and the exclusive distributor of UNO feeds in Negros and Panay areas in the Visayas. The business was founded by Richmond’s father and his business partners in 1988. It was established in Region 6 which was nationally known as a top producer of sugarcane thus Richmond’s father and his partners decided to venture into the distribution of fertilizer. They got an exclusive distributorship from the Philippine Phosphate Fertilizer Corporation which helped jumpstart the business venture.
In 1999, Richmond decided to leave his corporate career working for an international bank where he was initially based in Manila. Having no background in managing an agricultural business due to decades of being with the corporate sector, Richmond had to learn the ropes as he did them.
He narrated, “I resigned from the bank and helped our business. From there, I saw that we had to go beyond the usual selling and trading of fertilizers. I wanted to put up more branches and then develop our identity as an agricultural provider to our clients.”
When asked if his transition from the corporate world to managing their own business was difficult, Richmond shared, “When I started, I enjoyed it. Bacolod at the time was not as populated as compared to now. There was only one mall. There were not a lot of restaurants and coffee shops. There was nothing to do. I had a lot of time in my hands to think about the direction with which I wanted to take our business.”
Expanding the business was a careful and deliberate process. Falcor Marketing had to weigh the pros and cons of doing such. Among their considerations included the issue of product pilferage which was taking its toll on their profit. Another consideration was the need to have stable lines and connections from their main branch to their local branches for more efficient and faster inter-office communications.
Richmond recalled, “We had to invest in a good and reliable technology service provider because of our foreseen needs at the time of expansion. Going digital was important to keep up with the changing demographic profile and the fast changing consumer and market behavior. Globe My Business was a good choice for our business strategy.”
When Falcor Marketing started in 1988, they were using a different service provider, and they were not happy with its service. At the time, they started with around four full-time employees. When Richmond got onboard more than a decade after, and with still one branch in operation, there were around 10 full-time employees. Now they have close to 150 full-time employees in all of their 14 branches including a kiosk for dog food that was based in one of Bacolod City’s biggest malls. According to him, “When we invested in a Point of Sales system back in 2013, Globe became our partner for our servers. I personally found Globe to be stable from the start and we did not have any problems with their services. Slowly we expanded through our new branches.” Their partnership with Globe was an essential factor at the time that their branching picked up.
Expansion of Business Branches and Product Lines
From pig's feeds, they expanded to chicken feeds and added dog food to their product lines in 2019. They were the exclusive distributor of feeds of the Universal Robina Corporation of the Gokongwei Group for Region 6. They carried their hog feeds, veterinary products like medicine, fighting cock feeds, chicken feeds, and dog food. Aside from URC products, they also sold their competitors’ products because they wanted to diversify and not limit their product lines to one supplier only. It cannot be monopolized because customers would have their own preferred brand. As they expanded, they found the inventory system a big challenge.
“I saw the potential of continuing the business of distributing our products in areas outside of Bacolod given the increasing demand. This eventually resulted in us having 12 branches in Negros, 2 branches in Panay and a kiosk that sells dog food by the entrance of one of Bacolod City’s biggest malls,” Richmond reflected.
With their expansion also came the growing need to address their communications requirement for their employees that included technical people who were the one directly in contact with their clients.
Falcor Marketing transitioned from being a mere trader of fertilizer, hog and chicken feeds to providing training and workshops to backyard hog raisers as part of their service. Thus, they hired technical employees to take on this task.
“Initially we did not have technical people in the business. However, we noticed that our clients who were backyard hog raisers would seek our assistance to help them in delivering birth for their hogs or vaccinate the piglets. They did not know how to do these things. Because of this, we decided to include technical people into our human resource requirements. When we started, these kinds of technical support were not available in the market in this kind of business. We pioneered this in the areas where we operated,” Richmond proudly asserted.
It took them close to two years before they expanded from their first branch. It was a process of trial and error. There were some loopholes in how they were managing the business. For example in terms of human resource, those they initially hired were not a perfect fit for their positions. It was a learning process and they eventually realized what kind of employees they should hire based on the need and their qualifications. There had to be passion and a commitment for agriculture in their kind of business.
“Also when we started, we were small, so suppliers did not really consider us as a promising client. As we grew, we were able to prove that we were serious in the agriculture business and that was when suppliers started approaching us to offer seminars and training programs for our employees. This led to an improvement in our knowledge in agriculture. Leads Agri, Jardine Philippines, and other similar chemical companies began training us. We were capacitated through these seminars and training activities. Our services then organically improved,” he reiterated.
Innovations in their Business Strategy
Having fully realized his expansion plan for Falcor Marketing, Richmond had new plans for the enterprise moving forward. He stressed, “I also invested in hiring a resource person to help us improve our customer service relations. I figured our branches should offer more than trading but also extra public service. That gave me an idea about putting extra premium on customer service which was why I invested in improving my employees' knowledge of our products. Needless to say, interpersonal relations were very important.”
In terms of their physical business set-up, Richmond stuck to the usual look and feel of their stores. According to him, “Agriculture business was not a comfortable one. We toyed around the idea of putting up airconditioned branches but then our farmer and backyard hog raiser clients were put off by the set-up of an airconditioned establishment. To them, such a physical set-up was not inviting.” How their stores should look was a factor that Richmond considered important should they want to invite prospective clients to check out their product lines.
The innovations that Richmond introduced allowed Falcor Marketing to reap the benefits from such improvements. He underscored, “Gradually our clients expanded. We were able to cater to sugar associations and cooperatives in Negros.”
Impact of Covid-19 on Their Business
Richmond considered himself lucky upon reflecting on the impact the pandemic had on their business. He revealed, “Agriculture business was able to hurdle the challenges brought about by the pandemic.”
He mentioned several direct impacts of the pandemic, “First the sales were good. We were considered an essential sector so we never closed shops even temporarily. One of the advantages was that since we had existing branches, farmers were scared to venture out of their areas to seek out other suppliers and compare prices. They just went directly to us as we were easily accessible through our different branches. We also did dog food delivery right to our clients’ doorstep after receiving their orders through Facebook.”
“A second impact I can think of were the delays in the movement of our supplies. There were a lot of government health protocols in place from securing permits and food passes to going through the mandatory quarantine for travelers. These led to the delays especially in regard to our suppliers from Manila. When things had eased up a bit, although still not within the ideal timeframe, I would order in bulk so that we were able to keep up with the demands,” Richmond reasoned out.
Richmond imparted another impact of the pandemic on their business, “In terms of the hog feeds, there was a drop in sales because pork meat and chicken meat demand was substantially reduced due to restaurants closing down temporarily or, unfortunately, for good. Then there was also the report of African Swine Flu which also led to the drop in consumer demand for meat products.”
Furthermore, Richmond also cited the delays in the harvesting of sugarcane as a result of the pandemic. Farm workers, who were based outside of the sugarcane plantations, were required to undergo quarantine procedures and secure the required permits before they could travel and work in the fields. This was an added cost to the business of farming.
Sacrifices had to be made, and Richmond was fortunate to have had understanding employees, “Slowly, we started to catch up but we still had a long way to go. When I met with my employees, we decided to do away with incentives for us to be able to help the farmers. Our employees had to sacrifice their incentives to be able to help the company thus avoiding retrenchment. It was a mutually agreed upon decision between our employees and the management. We really struggled with our business and we all had to help and do our share.”
Richmond further emphasized, “In the long run, the virus would be gone but agriculture would still be there as an essential sector. What we were doing was more than just a business. What was equally important were those relationships we were able to establish all this time. Agriculture would stay through good times and bad times. We just have to be flexible enough to learn to adapt by identifying the possible business risks and preventing them from happening.”
Digital Solutions to Falcor Marketing’s Business Operations
When they shifted to Globe, Falcor Marketing’s office communication requirements were indeed addressed and the efficiency of their operations improved several times over. Richmond mused, “In 2013, we introduced the Point of Sales system for our transactions wherein we were already subscribed to 100mbps. In 2015, Globe introduced a Global Positioning Tracker that was very useful for us as we monitor our technical people while on the field. In 2019, we were introduced to G-Suites.”
Further he mentioned, “Our technical team subscribed to Globe's Php799 Call-All-You-Can Promo to all networks and landlines. This was very useful to us since our monthly communications costs were fixed. That was a big help for small businesses like us and could be translated to savings in our operations cost. We also had mobile data that was 4G so this allowed us to check on our technicians while on the field or our products in the different branches. Our employees would take photos of where they were at a certain point of the day or a snapshot of our available products as evidence and send those to us through Facebook messenger or Google Meet. It became a good way for us to monitor our people in the field and our store branches.”
Through Globe’s GPS tracking system, they were also able to closely monitor deliveries in the field and gave them a real-time check on the location of their deliveries. It resulted in further having an efficient operation and a lot of savings with regard to gasoline costs.
When asked what made them stick to Globe since they had subscribed to its services, Richmond cited one main reason: Globe had way better customer service relations compared to their previous service provider. Globe had a dedicated team who were always ready to assist them anytime and troubleshoot technical issues when needed.
“When Globe introduced G-Suites, they took time to visit us to have a demonstration. Of course at first, there was some exploration of the software and our learning curve was steep. We were used to Microsoft applications which was costly because we procured the license. With Google Sheets, all we needed was a subscription so it was big savings compared to Microsoft products,” Richmond recollected the experience of introducing G-Suites into their operations. They never heard about it before Globe conducted a demo using Google sheets. Once the branch inputs data into the software, the Accounting unit in their main office was able to see the inputs real time. It was a big help because they were able to save a lot compared to what they had been previously using—the old school fax machine.
Falcor Marketing was also able to put G-Suites into good use for their warehouse inventory across all their branches. “It improved our systems an awful lot. Before the introduction of G-Suites, it would take us 2 to 3 days to conduct an inventory. But using it, all inventories were completed by the end of the day. And the reports were generated right away. In the morning, they would print all inventories and then our auditor would visit the branches to double check the figures. What we found out was that reports were really now as accurate as they can be as compared to before. This also resolved the problem of pilferage or theft. There used to be a bad practice by some of our employees wherein some products were being sold but were not being recorded instantly because of the time factor in doing the inventory. Yes, it allowed us to be more efficient with inventory reporting, but more importantly, it also saved us money to pay overtime for employees who did inventory that took at most 3 days. The templates were already provided so all they had to do was to fill them out. More importantly, the time our employees were able to save from not doing overtime work because of doing inventory reports were channeled to more quality time with their respective families,” Richmond articulated.
Moreover, he disclosed, “In terms of our connection, we had a high speed connection. Our download and upload capacity were the same—which was an arrangement we negotiated with Globe. Our supplier of computer systems was based in Cebu. When they needed to amend the programming, troubleshoot some software glitches in our system or update the software, they just did everything online. They used to complain that our connection was so slow that it would take them a long time to provide technical assistance. But because of the high speed connection, the turnaround time was faster. We did not have any supplier for our technological needs based here in Bacolod that was considered to be high tech that was why we got a supplier from Cebu. But because of the impressive connection we had through Globe, physical distance was already not an issue.
Digital solutions also improved Falcor Marketing’s internal organizational processes. Richmond conveyed, “We had our meetings via Google Meet or Hangouts for all 14 branches and the kiosk we had in the mall. We got to see each other virtually in spite of the distance between branches. Before Covid-19 hit our shores during the first quarter of 2020, we would physically meet every month. Now we shifted to a virtual platform using Google Meet.”
He further explained, “Our employees had been upskilled when we introduced digital solutions to our operations. At first, the older ones had a hard time adapting. The younger ones were quick to adapt to G-Suites. Most of our employees, around 90% were considered millennials, the more tech savvy ones. In the end, all things were difficult before they were easy.”
Future-Proofing Their Business
Prompted in regard to his understanding of how their business’ Business Continuity Plan changed after attending the Globe Boost Camp in September 2020, Richmond verbalized, “It had a great impact on me. For example in terms of marketing, it led me to think about an experience I had in 2017. At the time, Globe invited us to SM Bacolod to put up a booth to showcase our products. During that time, a lot of people were visiting our booth but I noticed one thing that really stood out: I reckoned around 90% of the booth visitors did not know Falcor Marketing. This had taken me aback since we had been in business for 30 years! They were familiar with the products we were selling, especially the fertilizers and feeds but not us, the company itself.” For Richmond, this presented a very critical risk that they had to manage.
He noted, “Through the Globe Boost Camp, I learned the importance of branding. This led me to hire an expert to develop our brand through social media. We wanted to go beyond traditional marketing. We tried to set up our Facebook and website and develop the Falcor brand. One key takeaway from the camp was the importance of making an extra effort for your company's name to stick in the minds of your target clients rather than the products you were selling because products can change from time to time, while your company’s brand did not. Your company’s name had to be your legacy.”
Falcor Marketing wanted to enter the e-commerce platform. However, because they were selling products in bulk, they anticipated that they might have a hard time selling through an online platform like Shopee or Lazada. This was something that they would like to explore in the future especially given that online shopping had increased tremendously under the pandemic climate where people would prefer buying things online if they could, rather than physically visiting stores.
Through GCash payment, Falcor Marketing's clients had an option to pay through a cashless system. Falcor Marketing considered using e-commerce platforms as another option for their clients to purchase products from.
Additionally, Richmond also shared that they had been receiving inquiries from Filipinos and foreigners living abroad who wanted to donate money to buy dog food to be distributed to animal rescue centers. “It was something that we had been getting a lot of inquiries on. The bank rates for cash transfers for donations were quite exorbitant for foreigners. We explored using Paypal and this would become our next priority after we had improved our social media presence,” Richmond concluded.
Richmond saw the critical role that digital solutions played at the onset of the pandemic. Through their information technology (IT) capacity, they were able to adapt to the challenges brought about by the pandemic--shifting their physical in-store orders to online platforms using their company’s social media accounts, for instance.
Richmond shared the importance of their employees and processes as the core of remaining competitive in the market. He realized that it was critical to retain their current clients while increasing their customer base--and there was no better test of a company’s capability to do so than right after an adverse event.
Facing the challenges head on, Richmond concluded, “In the long run, the virus would be gone but agriculture would still be there as an essential sector. What we were doing was more than just a business. What was equally important were those relationships we were able to establish all this time. Agriculture would stay through good times and bad times. We just have to be flexible enough to learn to adapt by identifying the possible business risks and preventing them from happening.”
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