Business Model Canvas NMSPI

7.Key Partners

Providing Legal,
Regulatory,
Financial, Technical
and Business
Development
Services
Government:
Department of Trade
and Industry (DTI)
Department of Agrarian
Reform (DAR)
Department of Science
and Technology
(DOST)
Department of
Agriculture (DA)
Food and Drug
Administration (FDA)
Sugar Regulatory
Administration (SRA)
Office of the Provincial
Agriculturist, Negros
Occidental
Office of the Mayor, La
Castellana, Negros
Occidental

Industry Associations:
- Negros Organic
Muscovado Industry
Association (NOMIA)

5.Key Activities
NMSPI and TFM
personnel regularly
inspect farm lots of
sugarcane growers to
ensure steady supply of
good quality sugarcanes
as raw materials to the
mill for muscovado sugar
production. They
supervise the actual
harvest, hauling and
weighing of canes
delivered to the mill
Basically, NMSPIs
muscovado sugar
production activities
consist of:
1. Cane harvesting. A
truckload (5-10 tons) of
freshly cut canes is
delivered to the mill for
immediate crushing. Or
this may be stockpiled
for some hours while
waiting for the canes to
be delivered by other
cane growers.
2. Cane crushing. For
squeezing the juice out
of the canes, the mill

1.Value

4.Customer

2.Customer

Propositions

Relationships

segments

Muscovado is unrefined
brown sugar made from
sugarcane through a
natural process. It thus
retains many of the
essential dietary
vitamins and minerals
present in the sugar
cane plant such as
potassium, calcium,
magnesium and iron,
among other useful
compounds.

The demand for

muscovado sugar is
growing locally and
internationally as the
number of health
foods consumers
increases. This
budding market niche
presents an
opportunity to the
Philippine muscovado
sugar producers and
farmers. Despite the
positive, supply has
not caught up with the
demand both in the
domestic and world
market.

Muscovado is pure
whole, unrefined, noncentrifugal cane sugar.
Muscovado retains all
of the natural
ingredients of
sugarcane, making it
wholesome and
healthy. Only pure
bee's honey can
compare to muscovado
for natural goodness.
The nutritional qualities
alone are quite
exceptional and can be
compared with honey.
Muscovado is also a

Because market niche

already exists for
muscovado sugar,
farmers supplying
canes to NMSPI
continue using the
conventional farming
method over organic
farming unless the
whole market niche

- Bacolod/Negros
customer segment
includes local coffee
shops, hotels,
restaurants and
supermarkets
- Metro Manila
supermarkets
- Metro Manila hotels,
restaurants and
coffee shops
- Industrial customer
segment
- Export and fair trade
market
The export market is
the largest customer
segment due to the
relatively high prices.
Locally, the Negros
and Metro Manila
supermarket segment
is the largest customer
segment in terms of
market volume.
The Negros and Metro
Manila hotel and

Business Model Canvas NMSPI

International Agencies:
- ICCO
- Oikocredit
- World Banks Philippine
Rural Development
Program (PRDP)

Local NGOs, MFIs and

Cooperatives:
Task Force Mapalad,
Inc. (TFM)
Negros Island Savings
and Credit
Cooperative (NISCO)
Upgrading Performance
for Sustainable
Capacities and
Livelihood Enterprises
(UPSCALE) - Negros
Federation of Peoples
Sustainable
Development
Cooperative (FPSDC)
Pag-inupdanay Inc. (PI)
Balay Pag-inupdanay
Foundation, Inc.
(BPFI)
Foundation for a
Sustainable Society,
Inc. (FSSI)

Suppliers
- Farmers/ARBs in the

employs mechanized
crushing using cast-iron
three-roller mills driven
by a motorized engine.
About two hours of
crushing could yield
enough juice for a single
cooking batch of 3 cast
iron vats.
3. Juice transfer. To
transfer milled juice
directly to the cooking
vats a hose or a PVC
pipe traverses from the
mill outlet to the vats.
4. Juice cooking. The
furnace is slowly fired to
heat the juice in all the
coking vats. Cane juice
boils at 100 105
degrees centigrade.
Cooking time is usually
3-4 hours. Evaporation
ensues leaving only
about 30% volume of
concentrated juice. The
thickened juice is
gradually scooped to the
succeeding vats from the
last to the first vat where
the final cooking takes
place. Scum removal
during ebullience (juice

natural high energy

food source that quickly
replaces lost vigor.
Unlike centrifugal and
refined sugar, the
presence of molasses
gives muscovado sugar
its color, aroma as well
as desirable mineral
content and natural
flavor.
The absence of sugar
crystals qualifies
muscovado as soft
sugar, suited for
cooking as well as for
confectionaries.
Because of its distinct
qualities, it has gained
wide acceptance as
health food particularly
as sweetener for hot
beverage.
Generally, muscovado
sugar production poses
high income
opportunities because
of its high value
product image / market
positioning, high
demand and high end
target markets, thereby

begin to clamor for

organically produced
sugarcane. Only
exporters have
become sensitive to
the market for
organically certified
muscovado sugar
because these are the
segment of traders
who are in touch with
markets requiring
organically grown
products. Local traders
do not discriminate
over organically grown
sugar.

restaurant segment
has small quantity
requirement per
account but is still
significant in market
size on the aggregate.
The Metro Manila
coffee shop segment is
easier to serve as
purchases may be
made at the central
commissary level.
Demand of the
industrial segment for
muscovado sugar is
limited due to its
preference for the
cheaper refined sugar
and artificial
sweeteners

Business Model Canvas NMSPI

municipalities of La
Castellana,
Pontevedra, and La
Carlota in the
province of Negros
Occidental
- Negros Island Savings
and Credit
Cooperative (NISCO)
- TFM Provincial
Federation - Negros
- Agrarian reform
beneficiaries
organizations
(ARBOs) in the
municipalities of La
Castellana, and
Pontevedra , and La
Carlota City
Buyers
Supermarkets:
- Shopwise

Food product
distributors:
Upland Marketing
Foundation, Inc.
(UMFI)
Sharmila, Inc.
Global Organic and
Wellness Corp.
(GlowCorp)
Los Ricos Compania

boiling) is done through

skimming.
5. Juice Hardening. Only
a minimal amount of
slaked lime is added for
purposes of hardening
the concentrated juice
(technically termed as
massecuite) further.
6. Curing. For powdered
muscovado sugar, the
massecuite is
immediately transferred
to the tubs, and vigorous
stirring using
spades/paddles ensues.
Air cooling renders this
operation easier. The
lumps are oowdered to
the desired consistency
and texture. Color
changes from
brown to yellow, which is
the more desired color
for marketability.
7. Sieving: This
operation consists of
separating the big
particles from the rest of
the powdered
muscovado sugar.
8. Storage. 50 kg. bags
are used for powdered

alleviating the standard

living of sugarcane
producers.
Product Features and
Benefits: Product
quality is assured at
three stages: the use of
selected sugarcane
varieties at the inbound
stage; strict quality
control and food safety
management with
traceability at the
production stage; and
independent laboratory
tests by regulatory
bodies at the outbound
stage.
Unique Selling
Proposition:
NMSPI Brand - high
quality muscovado
produced with
traceable compliance
with food safety
measures.
Packaging:
NMSPI will continue to
sell muscovado in bulk
(50 kilo bags) and

Business Model Canvas NMSPI

Corporation (Coco
Natura Sugar)

muscovado storage.
9. Packing & Cooling
down: This operation
takes places in the
packaging area.
10. Marketing. Through
Bacolods seaport, NMSPI
may ship its muscovado
sugar to Metro Manila
market outlets such as
supermarkets and food
distributors. NMSPI may
store also store some of
its muscovado sugar for
better sale period,
usually during peak
demands in November
and holiday seasons.

6.Key resources
Physical Resources:
1. Plant housing. Under
GI sheets and a floor
area of 500 sq. meters
with a store-room
(bodega) within the
plant-house.
2. Leased land for the
mill (5,000 sq. m.). 25
years lease contract
duration from 20008
to 2033.

packaged according to
the buyers
specifications.
UPSCALE brand will be
needed in serving the
local retail market
segment.

3.Channels
Promoting the Product
and Value Propositions
At present, NMSPI
muscovado is sold
using the label of its
institutional buyers.
Through NMSPI, a
product brand name
shall be developed and
registered to raise
customer awareness of

Business Model Canvas NMSPI

3. Machinery Equipment.
- Juice extractor.
These are threeroller cast-iron mills
provided with
accessories as cogs,
gears and belts and
is driven (rotated) by
a motorized engine.
PVC pipes lead the
milled juice from the
base of the mill to
the cooking vats.
- Cooking Vats.
Locally called
kawa are made of
mild steel measuring
30 deep and about
50 top diameter.
- Curing tubs. Made of
stainless steel, the
rectangular curing
tub serves for
crystallizing,
solidifying, the
concentrated syrup
through vigorous
mixing using spades
and paddles.
4. Furnace. Directly
below the cooking
vats is a furnace with
cement lining.
5. Miscellaneous/

the product and the

companys value
propositions. The
brand name will
communicate a quality
image based on
compliance with
current Good
Manufacturing
Practices (cGMP) and
installation of Hazards
and Critical Control
Points (HACCP) in the
mill.
Distribution Strategy:
Both domestic and
export markets will be
explored. For the
international market,
the indirect entry
mode will be preferred,
using agents/traders
who specialize in the
export and distribution
of muscovado sugar
abroad.
For the domestic
market, a direct
marketing approach
will be used, utilizing
the house brand of

Business Model Canvas NMSPI

Consumables: Other
materials for
muscovado
hardening, curing and
bagging such as: lime
and sacks.
Human Resources:
The mill requires 8-10
workers to run the mill. It
will also need to fill up
the managerial,
technical, and
administrative posts with
the corresponding duties
and responsibilities:
1. General Manager
-

Makes decisions
related to program
implementation
Exercises control
and supervision of
all mill staff and
workers.

2. Plant Operations
Manager
-

Oversees the
operation of the mill
at the production
and marketing

supermarkets and repackers. Other

institutional or
industrial markets will
be explored. Upon the
development of its
own brand name,
NMSPI will target
coffee-shops,
restaurants, bakeries,
small neighborhood
stores, confectionaries,
cooperatives, schools,
commissaries, and
offices.
Promotional Strategies,
Customer Awareness:
Participation in
international trade
fairs held in the
Philippines as a
strategy to enter the
export market.
Promotional mix which
will include:
- Participation in
annual trade fairs
and expositions,
outbound selling
missions, and instore promotions

Business Model Canvas NMSPI

aspects.

Provides regular
monthly report on
the mill operations
to the CEO.

3. Quality Control
Officer/ Production
Supervisor
-

Inspects, monitors
and evaluates the
sugarcane delivered
to the mill

Ensures that the

process flow critical
control points are
observed and
implemented;

Ensures that the

quality control
procedures or
standard sanitation
and operating
procedures
implemented
( equipment and
utensils, personnel
hygiene, working
areas and pest

Use of internet and

online social media
Direct marketing
through telephony
and personal
communication
with prospective
buyers

Business Model Canvas NMSPI

control);
-

Responsible for
quality assurance of
products for
shipment to various
outlets.

4. Administrative and
Finance Staff
-

Manages the mills

administration,
finance and logistic;
Handles all financial
transactions in
accordance with
standard accounting
procedures and the
mills approved
budget.

9.Cost structure

Capacity building,
PhP1,485,000.00
Mill
upgrading
PhP13,580,000.00

8.Revenue stream
marketing
and

Cost of Capability-Building
Promotion:
Particulars

and

working

promotion:
capital:

Revenues will come from the prospective buyers of NMSPIs

muscovado sugar, based on sales targets for the 2014-2015
milling season are as follows:
Buyer

and

Marketing

Amount

&
Upland Marketing Foundation, Inc. (major
buyer for the past 2 years) / FPSDC
Shopwise (retail chain with 28 outlets in

Volume of
Annual
Purchase
50 tons
100 tons

Business Model Canvas NMSPI

(PhP)
Capability-Building (Organizational)
Consultations, orientations, & meetings
Financial audit
Planning
Corporate governance trainings
Incorporation and registration
Systems installation
Capability-Building (Technical)
Technical audit
Technical trainings (5)
Research & development
Installation of hazard critical control
points
Training, systems installation, & organic
certification
Marketing & Promotion
Negotiations for supply contracts
Training on marketing & sales
Formulation of marketing strategy
Creation & maintenance of UPSCALE
website
Establishment of outlet in Bacolod City
Participation in trade fairs/expositions &
selling missions
Search for buyers & client calls
Total

75,000
60,000
90,000
100,000
25,000
60,000
120,000
200,000
120,000
45,000
545,000
30,000
45,000
45,000
120,000
25,000
300,000
60,000
2,065,000

Cost of Mill Upgrading and Working Capital:

Particulars

Amount

Metro Manila)
Global Organic Wellness Corp.
Sharmilah
Coco Natura

50 tons
100 tons
50 tons

A total of 350 tons will be sold to these identified buyers and

additional 150 to 200 tons will be sold to other distributors
and the local market.
A competitive pricing scheme will be adopted by NMSPI. The
prevailing market price shall be regularly monitored and be
the basis for setting the price for the NMSPI Muscovado
which shall always be 10% cheaper than the competitors
price. Upon confirmation of purchase order, a 50% down
payment will be required from the buyer while the remaining
50% shall be demandable upon receipt of the goods by the
buyer.
Moreover, the muscovado sugar that will be processed and
marketed by UPSCALE and NMSPI will be positioned in the
local market as substitution to relatively high priced brown
sugar in the market, which majority of Philippine sugar
consumers presently use based on the Philippine Sugar
Withdrawals1 from 2009-2010 of 162,296MT Raw Sugar and
125,338MT
Refined Sugar. It will not initially compete with the prevailing
high-priced muscovado sugars available in the market but
rather position itself in the market as a healthy sugar for
the masses.

1 SRA CY2009-2010 Sugar Supply and Demand Situation. Highlights of SRA Sugar Production Bulletin.www.sra.gov.ph

Business Model Canvas NMSPI