PATAMABA - Cebu

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PATAMABA-OXFAM PROJECT: Strengthening the Marketing Network of Women Workers in the Informal Economy Towards Advancing Fair, Just and Sustainable Trade

THE FASHION ACCESSORIES INDUSTRY

The general policy of the project emphasizes assistance to women in the improvement of their current marketing endeavors as well as in the creation of new opportunities.

Brief Industry Background

The nature of the fashion accessories industry in the Philippines lies in its variety of designs, its accessibility to an infinite cornucopia of raw materials (shells, wood, seeds, and other materials found in tropical Philippines), in the workmanship of females who have been traditionally used to producing fine products requiring attention, patience and an aesthetic sensibility, in its simplicity of production which can use child labor, and finally, in its relatively low labor cost.

The industry is a subcontracting system, which encourages competition among suppliers, subcontractors, job-outers and workers over the same orders. There is no written contract between a supplier and their job-outers, nor between the latter and their home workers. However, relationships in the community are such that a verbal agreement is usually kept because breaking it would mean not being able to get workers to do orders for you, or not being given jobs to do again, in the future.

There has been a marked diminution of orders for fashion accessories in the last few years brought about by cheaper labor costs of production elsewhere. Accessories from China, which are way cheaper than Philippine made ones (although not necessarily nicer or better), are competing in the market and winning out. In addition, the accents widely used in finishing and enhancing shell and wood fashion accessories, are mainly imported from countries like China.

EPPIE: Profile of a fashion Accessories Supplier

Eppie Labajo is a PATAMABA member whose main production site is located in Laray, San Roque, Talisay, Cebu. In this community, social services are inadequate and incomplete and a large sector of the population is either unemployed or underemployed.

Eppie is recognized for her reliability in the production of fashion accessories. Her principal buyer is a fashion and home décor exporter (Skyhorse Trading) owned by a Taiwanese, with about 200 suppliers. The main target market is abroad but Eppie could not name where her supplies are being exported to. Nor does she decide her product lines because these are decided by her buyers, who, also depend on their importer-buyers. Sometimes Eppie makes her own designs, but these are mostly dictated by suppliers or by her gut feel of the market demand. Eppie does not decide her prices either - these are decided by the buyer and negotiated with her, mainly based on the lowest she could go for the cost of labor. Since cost of materials is usually known in advance, this is not much disputed. While Eppie can negotiate the price of raw shells and wood with her local suppliers, she cannot do the same with the accessories and “findings” which some designs may require..

The determination of the daily/weekly/monthly income for workers who are paid per piece varies with the specific product or part of the product to be produced. The share that each level gets varies according to fluctuations based on the cost of raw materials and transportation; on the supply of labor based on seasonal, environmental and other factors like unemployment due to financial crisis, and on other socio-cultural considerations that affect labor negotiations like kinship, patronage, special relationship, political connections, etc.

The system of selling/marketing of fashion accessories is mostly dependent on export opportunities. Thus, while marketing of one’s supplies may have begun as an individual effort many years ago (when the fashion accessories industry was just beginning), today, marketing pretty much depends on the supplier’s reputation for making good products; their reliability in executing orders in full and delivering them on time, and the comfort and trust the buyer/agent feels vis a vis the supplier. Thus, Eppie promotes her reputation through the quality of her supplies and the satisfaction of her buyers.

Nevertheless, given new types of orders, new processes of production and personal histories of bankruptcy, illness, domestic crises, as well as individual energies, some area of personal marketing may and does take place, especially during the off-season periods

Eppie does not have any security vis a vis her buyers. If they decide not to pay her and run away, she has no firm contract that will protect her apart from a signed PO.

Problems and Issues

Child Labor Fashion accessories production easily absorbs child labor, and while it may not be the main cause for a child to drop out of school, it is among the factors that determine how a child’s time can be used, and how skilled a child can become.

Occupational Safety and Health Machines used in the manufacture of fashion accessories are dangerous and could harm adult and child workers whose fingers could be cut, pierced, or sliced at the slightest lack of attention. No masks are usually worn by cutters and grinders/polishers of shells and beads, nor by those who handle the chemicals involved in shell bead making.
Subcontracted work also wreaks havoc in the home, and pollutes, and cramps the already small and crowded home. It would appear that the stresses the workers have, especially children and women, doing multiple work, like trying to earn income, performing household duties, child care, and other activities like studying and keeping up with family obligations, combined with a polluted environment (especially in the areas where shell and wood are cut, ground and polished, and the air is full of fine powder-dust), can (especially during peak season) have a negative impact on the health of workers and their community at large.

Environmental Issues There exists an evident lack of awareness on environmental issues like abuse of the environment through unrestrained extraction of natural raw materials (shells and wood) and of the pollution caused by their processing in the community.

Dwindling Sales and Profits Sales and profits have been falling for the last five years due to heightened competition brought about by globalization. A lot of cheap substitutes have now entered the market. Designs are pegged to satisfy big buyers and when it comes to designing for the local market suppliers like Eppie will need to develop cutting edge to be able to increase sales.

Gender Tracking The industry is also gender tracked, resulting in more work and less pay for females (who are already multi-burdened), while men get to learn the use of machines (although these are hazardous), and get better terms of employment – better pay and more relative security over a period of time of work. While on the one hand, suppliers like Eppie and some job-outers can attain leadership above their male partners in the business of fashion accessories, it is not without some cost on their physical and psychological well-being. In fact they have to be super women who earn the money, and yet are homemakers, sexual partners, and child carers. Furthermore, because of their role as money makers, they are also burdened with the responsibility of solving the economic problems of the family.

Recommendations

Product In search for a niche market with PATAMABA and in preparation for the eventuality that there will be fewer orders and fewer POs in the future, designs that are more attractive, unique and specially “Filipino” must be explored as well as diversifying into practical accessories like usable home décors, for example.

In addition, since the raw materials used for this industry (shells and wood) may eventually work against it specially with a foreign market that is progressively aware of environmental issues, the opportunity of shifting to an environment-friendly business is worth looking into.

Promotions A new business approach, that shall include the production of brochures and flyers, must be seriously worked out with PATAMABA. Such informative materials highlighting the different products/items will create awareness and thereby help in acquainting or penetrating the market. Different designs must be featured each month or every quarter so that buyers would have something new to look forward to. For added value on social marketing, the brochure must include a brief feature on the producers (so that buyers can relate to the producers behind the products and thus appreciate the items more).

Place There is a need for a show room at the main production site so that interested buyers and even potential retailers can see the different product lines and the available designs. Customers who wish to know more about the fashion accessories and have custom-made orders can be readily referred to the showroom by the retail outlets. Having own market/display area decreases selling cost since the retailers’ consignment fee will be excluded from the cost.

Systematic Recording A systematic recording system is mandatory and must therefore be adopted. This is necessary for monitoring sales (to assess profitability and salability of the different items), receivables, orders to be delivered, loan balances and cash advances made, and inventory (to better manage the delivery of stocks to the outlets and prevent loss of inventory and sales). A staff must be assigned to fulfill the tasks of managing the accounts/records and monitoring of orders/deliveries and collection.

All costs of production should be included in the pricing of the individual items, including the imputed cost of utilities (such as electricity, water) and salaries (for example, Eppie as manager and her husband as supervisor of wood workers). Non-business, home and family expenses must be separate from business accounts.

Further Review and Planning In collaboration with PATAMABA, fashion accessories production should be reviewed and planned incorporating the following concerns:

• Expanding production for domestic consumption, which will give work all year round, and expanding domestic and international niche markets for more aesthetic and Filipino-inspired products; and
• Conducting a community-based organization approach that will highlight safety, health, social security, gender fairness, more cooperation between suppliers, job-outers and home workers, and more child friendly attitudes and practices, away from child labor.