Break­ing out of poverty

Im­prov­ing peo­ple’s lives is the core busi­ness of so­cial busi­ness en­ter­prise, rags2riches.

The Star Malaysia - Star2 - - LIVING - By S. INDRAMALAR star2@thes­

SUSAMARIE Esta­billo flashes a big, warm smile as she holds open the gates to the quaint house that is home to Rags2Riches, Inc, a so­cial busi­ness en­ter­prise that was founded and is based in Manila. The or­gan­i­sa­tion helps im­pov­er­ished com­mu­ni­ties in the Philip­pines lift them­selves out of the cy­cle of poverty.

“Wel­come to Rags2Riches,” says Esta­billo, as she leads the way to the “of­fices” on the first floor where Reese Fer­nan­dez-Ruiz, one of the found­ing part­ners and cur­rent pres­i­dent of Rags2Riches is wait­ing.

Fer­nan­dez-Ruiz is only 27. She was barely 22 when she started Rags2Riches, an eco-eth­i­cal fash­ion and home ac­ces­sories line, along with eight other like-minded Filipinos whom she met, by chance, while on a univer­sity visit to Pay­atas.

Pay­atas is the coun­try’s largest open dump site: It is the size of 40 foot­ball fields and is lo­cated in Que­zon City, one of the poor­est and most densely pop­u­lated parts of Metro Manila. Com­mu­ni­ties that live around Pay­atas (the area around the dump site) mostly scav­enge for a liv­ing. The un­em­ploy­ment rate is high but res­i­dents are re­source­ful in scav­eng­ing for ma­te­rial which they can sell for a small amount of money.

“There are about half a mil­lion peo­ple liv­ing in Pay­atas and they get ev­ery­thing … food, fur­ni­ture, clothes … from the dump site,” ex­plains Fer­nan­dez-Ruiz. “While we were there, we no­ticed a group of women who were scav­eng­ing for scrap ma­te­rial to make foot rugs which they would then sell for just a few pe­sos. The scraps of cloth were also hard to come by be­cause some oth­ers had taken ad­van­tage of their sit­u­a­tion and get the scraps di­rectly from gar­ment fac­to­ries and sell­ing them to these poor women. It was com­pletely scan­dalous!

“I mean, these poor women were only earn­ing 10 to 15 pe­sos (70 sen - RM1) a day from their rugs! They had no ac­cess to the mar­ket­place … I mean, there was no way they could go to depart­ment stores to sell their prod­ucts and now, they couldn’t even get the scraps from the site any­more and had to buy them from a mid­dle­man.

“It was very hard to see how peo­ple with big dreams and who worked re­ally hard, could not get any­where sim­ply be­cause they lacked op­por­tu­ni­ties. We knew that we had to do some­thing about it,” she says, adding that Esta­billo too was among the group of women weavers at Pay­atas.

Fer­nan­dez-Ruiz and her part­ners – a mixed group that in­cluded a Je­suit priest and sev­eral young pro­fes­sion­als that shared the vi­sion – re­alised that to make a last­ing dif­fer­ence in the lives of the com­mu­nity, they had to em­bark on a pro­gramme that was sus­tain­able.

A one-off effort to of­fer aid or money would not suf­fice. They wanted to em­power the com­mu­ni­ties in­stead of just dol­ing out aid.

“We re­alised that it would take a long time to ac­tu­ally solve this prob­lem be­cause there are a lot of poverty-stricken ar­eas in the Philip­pines. As long as these com­mu­ni­ties are not out of poverty, our work is not done.

“We de­cided that we needed to form a busi­ness – a for-profit en­ter­prise driven by our so­cial val­ues. And that is where we are to­day,” she ex­plains.

Build­ing on tal­ent

Rags2Riches used the weav­ing-skills of the Pay­atas women as the launch pad for their busi­ness. The com­pany ap­proached gar­ment fac­to­ries for ma­te­rial scraps which they in turn gave (not sold) to the women at Pay­atas. They also pro­vided train­ing for the women.

Though they al­ready knew how to weave, the women were put through a skills pro­gramme which they had to pass in or­der to be­come ar­ti­sans with Rags2Riches. As ar­ti­sans, they would be paid Fair Trade wages for their work. The women, many of whom are stayat-home mothers, are paid based on the num­ber of hours they work each day. As soon as they com­plete their al­lo­cated work, they are paid, re­gard­less of whether the prod­ucts are sold. This way, says Fer­nan­dezRuiz, they can be as­sured of a con­stant in­come stream based on their own effort.

“The first thing we did was trans­form the foot rugs they were al­ready mak­ing into bet­ter-look­ing ones with de­signs and colour schemes. We talked to the com­mu­ni­ties about our pro­gramme be­cause we didn’t just want to tell them what to do … we wanted to lis­ten to them and make them a part of this process. And, we learnt a lot from them,” she says.

Earn­ing the trust of the com­mu­nity at Pay­atas, how­ever, took time.

“At first, the com­mu­nity didn’t trust us and we un­der­stood why … they were very jaded. Many dif­fer­ent politi­cians and cor­po­ra­tions had been there be­fore us but they would stay for a day, feed them, take lots of pho­tos and leave. So of course they were sus­pi­cious of us. What made us any dif­fer­ent? We knew that it would take a while be­fore they saw that we were there to stay. It took around two years to gain their trust.

“We started with three ar­ti­sans and that slowly grew to nine and then 15. Now, we have 900 ar­ti­sans, not just from Pay­atas but sev­eral ar­eas in and around Manila,” says Fer­nan­dez-Ruiz with ob­vi­ous pride.

Apart from en­gag­ing their skills, the com­pany also in­tro­duced the ar­ti­sans to the mar­ket by get­ting them to sell their wares at bazaars.

“They had to man the booths them­selves. Ini­tially, they were very scared be­cause they had never done any­thing like that be­fore. They used to sell their rugs to a mid­dle­man and not to a mar­ket that was pri­mar­ily English-speak­ing.

“But once peo­ple started ad­mir­ing their prod­ucts and mak­ing them feel like their work was worth pay­ing for, they emerged from their shells and started be­ing very proud of their prod­ucts. Within three hours, 700 rugs were sold! When we saw that, we knew that there was a mar­ket for this, so we de­cided to do more,” she shares.

Fer­nan­dez-Ruiz and her team then ap­proached ac­claimed Filipino de­signer Rajo Lau­rel and pre­sented their busi­ness model to him, show­ing him sam­ples of their prod­ucts and pro­posed that he de­sign some­thing to add value to their prod­ucts. He agreed.

“He started trans­form­ing the foot rugs into wine cool­ers, van­ity kits, bags – and im­me­di­ately, the value of our prod­ucts in­creased and we could give back more to our ar­ti­sans,” re­lates Fer­nan­dez-Ruiz.

Esta­billo was one of the orig­i­nal three ar­ti­sans to join Rags2Riches. She, too, was skep­ti­cal when she first heard about the liveli­hood pro­gramme ini­ti­ated by Rags2Riches. How­ever, she agreed to give it a go, thanks to the per­sua­sion of her priest.

“I wanted to give up ini­tially be­cause the train­ing was dif­fi­cult. But I didn’t want to dis­ap­point my priest, so I con­tin­ued,” she re­calls.

Her per­sis­tence paid off. Within three weeks of work­ing un­der the pro­gramme, she re­ceived her first pay cheque.

“The first thing I bought was a large chicken for din­ner for my fam­ily,” she says, with tears in her eyes. “Be­fore, I’d have to scav­enge for food from restau­rants. This was the first time I could ac­tu­ally buy food that wasn’t spoilt or left over.”

Esta­billo is now the work­shop su­per­vi­sor, over­see­ing the pro­duc­tion of the fash­ion and home ac­ces­sories pro­duced by the com­pany.

Apart from earn­ing more money than ever be­fore, Esta­billo and the other ar­ti­sans have also been taught the fun­da­men­tals of fi­nan­cial plan­ning through the com­pany’s Qual­ity of Life Pro­gramme.

“We teach them how to save. Sav­ing for the fu­ture is an un­der­stated but very im­por­tant in­di­ca­tor of peo­ple who are ready to get out of poverty. To be in poverty is to live a hand-to-mouth ex­is­tence. With sav­ings, they can think long-term, which is a lux­ury for peo­ple who live day by day. So, this is very im­por­tant for us and for them. We are very en­cour­aged to see that some of their sav­ings are not get­ting de­pleted, which means they are earn­ing enough to sup­port them­selves and save some, too,” says Fer­nan­dez-Ruiz.

Rags2Riches now sells a wide ar­ray of wo­ven prod­ucts, apart from foot rugs. Work­ing with no­table Filipino de­sign­ers, the com­pany has a fash­ion line com­pris­ing de­signer totes, ho­bos, satchels, clutches and wal­lets as well as chok­ers and neck­laces and a home ac­ces­sories line of rugs and cush­ions.

Their suc­cess has won them ac­claim and a huge fol­low­ing in the Philip­pines and abroad.

Worth­while work: reese Fer­nan­dez-ruiz, co-founder and pres­i­dent of rags2riches, dis­play­ing ai­ra­sia Foun­da­tion’s in­au­gu­ral so­cial en­ter­prise award that was pre­sented to them this year. The women in the back­ground are the ar­ti­sans who pro­duce lovely wo­ven items. – Pho­tos from rags2riches

a Pay­atas woman en­grossed in her work, weav­ing an item that will be put on sale through rags2riches.

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