From Rattan to Riches

Rattan has been good to AWECA, an acronym of three manufacturing companies: AsiaRattan Manufacturing Co., Inc., Weaverscraft, Inc. and Calfurn Manufacturing Phils. Inc. Together, they export each year about $20 million worth of furniture that mix rattan with metal and leather as well as with indigenous materials such as seagrass.

The oldest of the three companies is Calfurn, which was put up in 1976 with a capital of P30,500. "We really started small," said president Eredito Feliciano. "We asked buyers to put down a 50% deposit, which we used to pay our 25 workers. Our raw materials were also bought on credit,"

From the profits of selling to the US military personnel of Clark AirBase, Feliciano and the six other incorporators of Calfurn put up AsiaRattan for the export market in 1978. Weaverscraft was established a year later to produce baskets that could be placed in between the spaces of furniture loaded into container vans.

"Our operations are vertically integrated. Whatever the company needs, a sister company provides," said Feliciano. For example, the AWECA Exim Trading Corp. sources and purchases the raw materials and supplies needed by the manufacturing operation. Future rattan supply is taken care of by AWECA Agro-Forest Industries Corp., which has planted timber and non-timber species on a 5,000-hectare leased government property. The delivery of orders to customers is handled by AWECA Cargo Services, Inc.

Realizing visions

Today, the AWECA Group is made up of 10 companies, shipping an average of 100 containers per month. Its biggest furniture haven is the 14-hectare Malino Livelihood Village in Pampanga, which has 35 buildings surrounded by 60,000 gemelina trees. It also has pocket factories in various areas in Angeles City, Pampanga as well as satellite operations in Pangasinan and Tarlac, and in the Visayas and Mindanao.

"This business has created jobs for many Pampangueños," said Feliciano. "We’ve invested a lot on our human resource because they are our partners. We believe in working together to produce the best results."

AWECA currently has a workforce which is about 5,000, most of whom are multi-generation families who started from the bottom such as Feliciano, a former jeepney driver, and Baltazar, a former weaver.

Splints to success

Like other manufacturing companies, AWECA has had to face problems from stabilizing its supply of raw materials to getting orders. "Sometimes you have the money to buy the raw materials but you have no orders. Sometimes, you have orders but you don’t have the raw materials," said Feliciano.

One unforeseen problem that almost destroyed the company and other businesses in Central Luzon was the Mt. Pinatubo eruption in 1991, shortly after it was awarded a Golden Shell Award for excellence in export products by the Center for International Trade Expositions and Missions. Close to 80% of AWECA’s facilities had collapsed.

"The following day, we called our people together. They had one day to fix their houses. The next day, they had to come back to fix the factory. A group of workers removed the debris, another group rebuilt the factory, another group made the furniture since there were still pending orders. Another group had to go to nearby provinces to buy food for all of us since there was no food supply in our area. The food supply was divided into bags for distribution to our workers at the end of the day. We also had a group cooking food for us because we couldn’t leave the site."

Because its workers were willing to work, AWECA was able to ship its first post-Pinatubo container a week later , and was back to 100% operation in the span of three months.

Looking forward

AWECA’s tremendous growth in the 1990s was partly financed by the Development Bank of the Philippines. The Group’s first DBP loan was P23.8 million extended to AWECA Exim in 1991. In the next 12 years, the government bank approved loans worth P5 million to Calfurn, which has been fully repaid; P8.3 million to AsiaRattan; and P12 million to AWECA Exim.

Because factories have been modernized and new equipment have replaced old ones, AWECA expects to double its capacity by 2005. "By that time, we would have completed our first 25 years and we will have started our next 25 years. We see AWECA growing three to five times more than its original size. Our experience has made us more mature — we know the business, we have a niche in the market, people come and look for us now. The only limit is how big we want it to be," said Feliciano.