Almost a month into my stay in the Philippines, it was finally time to start working with the organization Hapinoy, one of the two I was somewhat familiar with before I left for the Philippines. Hapinoy is a program implemented by MicroVentures, Inc. (MVI), a social business enterprise established in 2006 by Bam Aquino and Mark Ruiz—two candidates for Ashoka Fellowships.
With little to no business experience at all, embarking on understanding a social business enterprise seemed overwhelming and intimidating, but, after spending about a week in the office shadowing the employees, and a week in the field, piece by piece I began to understand the complex network that makes up Hapinoy. MVI established the first pilot Hapinoy program in July 2007, coining Hapinoy as the term expressing a “Happy Pinoy (a Filipino)”.
The Hapinoy project addresses poverty in the Philippines. Hapinoy is the first and largest “sari sari” (variety) store chain in the Philippines. Sari sari stores are owned and usually run by women, so that Hapinoys’ goal is to empower women within their communities—a strategy in which many development scholars believe is the best way to counter social problems such as poverty. In countries like the Philippines, tertiary stores like sari sari stores, which sell a large variety of fast and slow moving goods continue to outperform modern supermarkets. As of now, over 42% of all purchases in the country come from these variety stores. In a Philippines Center for Investigative Journalism 2005 report, “sari-sari” stores’ count nationwide was at 560,000 and this was expected to be 900,000 in 2010. Most “sari-sari” stores are found in lower income neighborhoods, thus the idea of Hapinoy is that by increasing their profitability would affect the welfare of many low-income households in the Philippines, therefore reducing poverty.
To establish the project, MicroVentures Inc. partnered with the Center for Agricultural and Rural Development (CARD)—the biggest microfinance institution in the country. Sari-sari store owners account for 10-12% of all of their borrowers nationwide, so Hapinoy saw that by partnering with CARD they could be connected to the Sari-sari store owners who would best fit the criteria of the program. Hapinoy members were chosen based on the following requirement: must be at a CARD-Mutually Reinforcing Institution (MRI) borrower for at least 6 months, possess a sari-sari store with a non-movable table, have a 100% repayment rate on CARD-MRI loans, and have a 99% attendance record for weekly center meetings with CARD. This criterion limits the members of Hapinoy exclusively to members of CARD, which while it simplifies the process of finding potential sari sari stores, may prevent the Hapinoy program from reaching all of the nanays, which are potentially in need of a program like Hapinoy.
In each location of Hapinoy stores, one member is chosen as the Hapinoy lead store. The lead store acts as a distributor of Hapinoy goods purchased directly from MVI’s partner manufacturers wholesale. The lead storeowner sells goods to both Hapinoy and non-Hapinoy customers; however, Hapinoy members receive gift checks from CARD as part of their micro-loans, which can be used to buy from the lead store, and receive a further discount for purchases. This gives incentive for the Hapinoy Sari-sari stores to buy from the lead store, and gives the lead store assurance that there will be customers. Hapinoy members still receive the loans from CARD, but once a member of
Hapinoy the loans change—such that the lead community stores receive a larger loan, and the sari sari stores receive loans both in cash and in gift checks, to buy from the community stores. Since the creation of Hapinoy, a new sector of CARD has been developed which specializes in business development—CARD Business Development Institute (BDI).
MicroVentures Inc. provides a service for Hapinoy community stores and Hapinoy sari-sari stores. From this simplified flow chart, we can see the major services provided by MicroVentures Inc. First, Hapinoy teaches recording techniques such as Point of Sales (POS), computer software used in the stores to record what was purchased and sold within the store, in addition to hand-written recording techniques. Hapinoy increases the number of customers because of the CARD gift checks and discounts for Hapinoy and CARD members entice them to go to Hapinoy community stores. Hapinoy has also developed relationships with different merchandising companies and brands so that Hapinoy Community Stores can sell wholesale to sari sari customers in addition to retail, and they receive deliveries of goods instead of having to shop at larger outlet stores far from their stores. One such relationship that Hapinoy has established is with its’ parter Smart, which is a mobile phone provider. Hapinoy community stores, unlike any other sari sari stores can now sell wholesale “load” (pre-paid cell phone minutes, and texts) to other sari sari stores just like any other good. Mark Ruiz explained to me that this new program, would really provide the greatest benefit for the Hapinoy program, because the direct sales of wholesale load would be more efficient for the sari sari stores.
Monthly community store meetings benefit the nanays by teaching business techniques, leadership skills and provide a forum for community storeowners and sari sari storeowners to share ideas and successful business techniques. Hapinoy also provides the community stores with Store Doctors who are responsible for visiting the stores weekly to record updates within the store on a spreadsheet designed by MicroVentures to collect data on how the Hapinoy project is working. These updates include the amount of sales, electricity/water bills, current balance of loans and any comments or concerns about their store. As of now, there are a total of 48 community stores within South Luzon, and MicroVentures Inc. has set a target for 150+ community store by the end of 2009.
Visit http://www.hapinoy.com/ to read more and a short video describing the program
