PRODUCTION SYSTEM OF ALBOCO FOOD INDUSTRY

38 Chapter IV RESULTS AND DISCUSSION In this chapter, the researchers discussed the results after analyzing the data gathered through the conducted interview, tools used, and in-site observations of the facility of Alboco Food Industry. Analysis of the data was done in which it identifies problems associated with the production process. A. Production Process Alboco Food Industry has five different production processes for the five varieties of products with varying demands. The type of production they perform is a batch type of production, where the products are made in batches. This type of production method is common in industries with a variety of products to offer and with varying demands. Prior to beginning the manufacturing, the entire number of outputs needed is determined by the demand from the customers because the volume of production changes as demand changes since they prioritize the products that are high in demand. Alboco Food Industry’s flagship product is peanut butter and is mostly the product that they largely produce. The target volume of production for peanut butter is 1000 bottles for 210 grams, 840 bottles for 300 grams, and 300 bottles for 630 grams per production day. With this, the production processes tend to repeat because machine capacity cannot handle the projected volume in a single production. Some of their machines such as the roasting machine have a capacity of 50 kg/hr, however other machines such as the grinding machine can only be utilized up to 30 kg/hr. This makes an average of 7 repetitions in the grinding process and the following processes to reach the target. Additionally, Alboco Food Industry processes one product at a time. Accordingly, the required quantity of peanut butter is scheduled to be produced within the first three days of the week. Whereas, after the scheduled production for the peanut butter, two consecutive days are allotted in producing the turon de mani. And after the allotted two days in producing the turon de mani, one day is scheduled for the production of the roasted peanuts. The whole facility is operated by a local electricity provider in Tacloban City which is Leyeco. A stable source of energy is necessary to successfully finish a production. According to the conducted interview, most of the products

39 that they produce use machinery during their operation. However, there are times that their area is affected by power outages, and it is most likely during weekends. In accordance with this, they also experience production interruptions during power outages, particularly for products that depend on electricity for their machinery. It was also stated by the owner that the occurrence of power outages is a problem for their production since they do not have an existing power generator that they can use as a backup power source. However, in order to lessen the idle time during power interruption, they are using it in producing the turon de mani. The business owner added that they are using the time on producing the turon de mani because all process steps are carried out manually, aside from sealing the packaging of the said product, which requires the use of a power source. All products start the production process with the deshelling and sorting of the peanuts, except for the roasted peanut with shell. Before delivering the peanuts to the facility, the suppliers already cleaned and dried the peanuts. This indicates that the drying and washing processes are not carried out in the facility. Before accepting and storing the raw materials, an inspection is being conducted by the owner to ensure good quality of raw materials. Once the peanuts arrive at the facility, it is immediately subjected to deshelling and then sorting to prevent the peanuts from rotting. The peanuts are usually stored after deshelling and inspection within the deshelling area. The peanuts that are deshelled are stored in containers placed near the deshelling machine while wastes like the shells are placed in sacks subject for disposal. During this process, a deshelling machine is used with only 1 personnel assigned to do the task. Deshelling takes 15 minutes per sack and the number of sacks depends on the quantity of peanuts they got from the suppliers. All deshelled peanuts will now be subjected to the next process which is sorting. Sorting of peanuts is done manually to separate the poor quality of peanuts ensuring that no defects are being added before the peanuts are roasted. Since this process is done manually and with only 1 personnel, sorting usually takes 2-3 hours depending on the number of peanuts that are deshelled. Upon sorting, the peanuts are stored in a container within the deshelling area which is ready for the next process step. Roasting is the next step and all the products of Alboco Food Industry undergo this process. For peanut butter,

40 turon de mani, and roasted peanut without shell, the peanuts that are roasted are deshelled while for roasted peanuts with shell, the peanuts are roasted with their shells. A roasting machine is used which is located in its designated area. Upon observation, the roasting area is small and has a high temperature due to the heat emitted from the machine and the area contains only 1 exhaust fan. Roasting is done by 1 personnel and this process takes an hour for every 50kg. Roasted peanuts will undergo cooling which takes place inside the roasting area. The peanuts are placed on a large basin and an electric fan is used for cooling. This is also done by 1 personnel assigned in the roasting area. The cooling process usually takes an hour before proceeding to the next step. After cooling, the next process step is peeling. During the conducted visitation, it was observed that the peeling process is done manually because the peeling machine is unavailable and is under repair. The process is being done inside the roasting area as well and with 3 personnel. Peeling with the use of the peeling machine takes 50 kg per hour, however, manual peeling takes 2 hours to finish 50 kg of roasted peanuts. Workers use winnowing baskets for peeling and the peeled peanuts are being placed in a drum container. After peeling, the roasted and peeled peanuts are transported to the work-in-process area for storing inside the containers labeled as roasted peanuts. Since there is a work in process of peanuts, usually, the production of Alboco Food Industry starts on its grinding process. The two varieties of peanut butter differ in the grinding process. The crunchy peanut butter takes 2 grinding processes while the creamy peanut butter takes 3 cycles of grinding process to ensure that the butter is fine and smooth. Every grinding process takes 30 minutes for both types of peanut butter. From the stored roasted peanuts, a stainless casserole is used to transport the peanuts to the grinding machine. Personnel are assigned to operate the machine for every production. Based on the observations conducted, the facility has 3 grinding machines within the production area, however, the process is frequently done in only two grinding machines. One grinding machine is not used because it is too old and the standards of the Department of Science and Technology and Food and Drugs Administration mandated that machines must be stainless and updated. This causes backtracking due to an inadequate number of machines which also prolongs the number of production time up to an additional of 30 minutes per

41 batch. When the butter is ready for mixing, it will be transferred to the mixing machine with the use of the casserole. The mixing process takes 30 minutes to finish 25 kg of the mixture with the machine capacity of 50 kg per hour. In this process, other raw materials are being added like sugar, salt, and coconut oil to the grinded peanuts. Personnel are also assigned to operate the mixing machine. After mixing, second grinding will proceed which indicates that the machine used on the first grinding is used again to grind the mixture. The third grinding for the creamy peanut butter is done after the second grinding process. The machine used here is a customized machine, wherein it is used for two different processes that are connected to lessen the time of transferring the output of the last grinding process to the filling machine. In this process step, a staff is assigned as the operator. The next process is the filling process where the machine is used to fill the peanut butter on the containers. One variant of peanut butter at a time undergoes the filling process. The machine is semi- automated since it uses a manual pedal to fill in the bottles. This is operated by one personnel and usually takes 30 minutes to finish 270 pieces of bottles. After the butter is filled into the containers, it will undergo a cooling process. The peanut butter is placed on a stainless table and is cooled using two stand fans which take about an hour. Alboco Food Industry implements color coding on the cap to sort out the two varieties of peanut butter. Moreover, stickers with barcodes are attached to the containers for labeling of the finished products. For turon de mani, the production process also starts with deshelling followed by sorting and then roasting. However, based on the observation conducted, the roasted peanut is typically a work-in-process inventory. This inferred that the daily production of turon de mani frequently starts with the grinding procedure. The grinding process takes 30 minutes for 30 kilograms of peanut and is done with 1 worker. Furthermore, from grinded peanuts, the production process for turon de mani will undergo mixing to create the peanut mixture. The mixing process usually takes 30 minutes for 25 kg of the mixed ingredients. This includes sugar, grinded peanuts, and coconut oil. In accordance with this, the production process for turon de mani tends to be longer because the next crucial step, which is the wrapping, is done manually with bare hands because they do not have a wrapping machine. The wrapping process is done manually by four workers on a stainless table. The only material

42 that can be seen on the table are the wrapper, containers with the turon de mani mixture and the equipment used in the process such as tablespoon to scoop the mixture from the container to the wrapper. The workers primarily cut the wrappers into half to achieve the desired size of the turon de mani. On average, the number of turon de mani that a single worker can wrap is 163 pieces per hour. As per the interview, the owner stated that they aim to produce 130 packs per day with 20 pieces of turon de mani per pack. This indicates that the target quantity of turon de mani to be produced on a specific production schedule is 2600 pieces, where it usually took four workers to finish wrapping the turon de mani for four hours. Additionally, it was also noticed that the workers were not using hand gloves while doing then wrapping process. The wrapped turon de mani is placed on a tray and is transferred to the frying area. The next step is the deep frying which is done by only one worker using a stove and a small frying pan. As per the observation, frying is done simultaneously with the wrapping process. After frying, it will be placed on a strainer to drip off the oil. Then, the turon de mani will be transferred and placed in a clean cloth to ensure that the excess oil is being absorbed and it undergoes a cooling process with the support of a stand fan. The owner has also mentioned that they are reusing the oil they used to fry the turon de mani as cooking oil for their home in order to prevent oil waste. Furthermore, inspection before packaging is done to ensure the quality of the finished products. For the roasted peanuts with and without shell, the roasted peanuts with shell will not undergo deshelling, and will be manually sorted by personnel that takes 2-3 hours depending on the number of peanuts. Roasting is the crucial process with the use of the roasting machine which is operated by 1 personnel. This roasting process takes 1 hour to meet the best roasting quality. The quality of roasted peanuts may depend on how the peanuts are being roasted. The excess roasted peanuts which is a work-in-process in preparing the peanut butter are being processed and used in the production of roasted peanuts without shell to maximize the production and achieve zero-waste of the raw materials. After the peanuts are roasted, an inspection is done to ensure that no defective nuts are added in the pouch for packaging. This process is being done by three personnel that takes 10 minutes. After the inspection, the roasted

43 peanuts are being packed using a zipped pouch bag as a packaging material so that the consumers can still close the pouch if they could not finish the pouch of peanuts. B. Production Design and Layout Figure 11. Alboco Food Industry Production Layout Figure 11. Production Layout of the Alboco Food Industry Figure 11 shows the production layout of the Alboco Food Industry. The production area is distributed into smaller areas which are designated for the different production steps required in the manufacturing of products. Furthermore, the business used a product layout designed in the facility. This type of layout is utilized since the production requires a batch production process for the product such as peanut butter, turon de mani, and roasted

44 peanut. As per the interview, when the peanuts arrive, it will immediately undergo the deshelling and sorting process. After these two processes, the peanuts are being stored also within the deshelling area. This area consists of 1 deshelling machine and is operated only by 1 staff. The assigned personnel in deshelling are also responsible for the sorting process. Moreover, the deshelling and sorting process is done in a room that has no door with broken walls which is located outside the manufacturing plant. Due to the set-up of the room, the peanuts could be prone to cross-contamination. Peanuts are being transferred only upon the requirement of the production. Additionally, the deshelling and sorting area measures 3 x 2.5 meters, and its doorway has 1- meter distance to the door of the manufacturing plant. Upon the entrance of the manufacturing plant, the raw material storage can be found. This area houses the raw materials such as sugar, salt, oil, and packaging materials which are just placed on the floor. The raw material storage measures 1.86 x 3.25 meters which consumes 6% of the total area of the Alboco Food Industry. Beside the raw material storage is the dressing room. There is no distance between the two areas as they are only separated by a wall. Moreover, this area measures 1.65 x 3.25 meters which is 5.3% of the total area of the facility. Inside the room, the worker's personal protective equipment is placed including the aprons, hair nets, mouth shields and working shoes. Based on the observation conducted, the area is also used for storing other unnecessary materials that are not suitable to be kept within the room. These materials include a washing machine, containers and cleaning materials which consume space allocated for the personnel requirements. This area only has a small window for ventilation and no electric fan is provided. Beside the dressing room is the roasting area. This area is located at the end of the aisle of the manufacturing plant. Based on the observation, the roasting area is a small space in which it consists only of two small windows and one exhaust fan for the ventilation of the area. The area measures 2.85 x 3.25 meters which consumes 9.3% of the total area of the Alboco Food Industry. After the roasting process, the peanuts will be cooled and peeled also inside the roasting area. As per observation, the roasting machine emits heat that increases the temperature within the area. Furthermore, the roasting process uses 1 roasting machine which is operated by 1 staff, while, for the

45 peeling process, it uses 1 peeling machine operated also by 1 staff. However, during the conducted visitation, the peeling machine is under repair which makes the peeling process done manually by 3 personnel. Moreover, the aisle from the raw material storage up to the roasting area is narrow in which it causes traffic for the flow of the workers. The width of the aisle measures 1 meter wherein workers cannot pass through simultaneously. The largest area of Alboco Food Industry's manufacturing plant, about 62% of the total facility space, is taken up by its main production area. This measures 8.10 x 6.36 meters and is located in front of the roasting area. This is composed of areas such as work-in-process area, grinding area, mixing area, filling area, cooling area, frying area, packaging area, and the finished goods area, with the different machineries used namely, first grinding machine, mixing machine, second grinding machine, third grinding machine, filling machine, and sealing machine. Upon entering the main production area, container drums for the roasted peanuts can be found which is the storage for their work-in-process products. Next to the container drums are the machines that have a 0.50-meter distance in between. The arrangement of the machines is based on the sequence of the production process. The first grinding machine has a dimension of 110cm x 90cm x 120cm. Based on the observations, it is operated by one worker who is also responsible for transporting the raw materials to the machine. Beside it is where the mixing machine is located. The mixing machine is also operated by one worker. It has a dimension of 90cm x 90cm x 125cm. It is placed between the first grinding machine and second grinding machine. The second grinding machine has a dimension of 50cm x 45cm x 110cm and is located between the mixing machine and the third grinding machine. The third grinding machine has a dimension of 65cm x 30cm x 95cm. It is located on a table and is connected to the filling machine that has a dimension of 55cm x 30cm x 85cm. These machines are elevated with the use of platform stands to ensure that the machines are secured on their locations. The cooling and capping area is located on the center left side of the main production area. The area has a stainless table where the cooling process occurs. Two stand fans are also used in this process which can be seen in the area. The frying area is placed across the cooling and capping area with a

46 distance of 4 meters. It has a dimension of 1.5m x 1m. One worker is responsible for the frying process during the production of turon de mani. It can be observed in this area the different cooking materials such as cooking oil, LPG gas, and cooking equipment. Additionally, a sink is placed beside the frying area where they clean their used equipment. The packaging area is placed on the right corner of the main production area and beside the frying area. It has a dimension of 1m x 1m. Present within the area is the sealing machine and the packaging materials such as scissors, tapes, labeling material, etc. Beside it is the finished goods area which is placed near the exit door. It has a dimension of 0.5m x 0.5m. The finished product such as peanut butter is stored in baskets that are piled up and are ready for delivery. As per observation, the flooring of the production area is coated with not slippery paint which prevents workers from accidents. Signage is also present within the facility. The signage indicates the names of each area that are present, as well as the safety signs that state the prohibited accessories inside the production area and the rules to be followed during production. Furthermore, as per interview, the owner stated that the current facility of the Alboco Food Industry is formerly a residential house which has been converted to a manufacturing facility for their business operations. With this, the design of the hallways is narrow wherein two workers cannot pass through simultaneously. Moreover, the comfort room is located outside of the production area. Table 6. Illumination Level of the Different Areas Area Illumination (lux) Interpretation Deshelling Area 30 Low Raw Materials Storage Low Area 20 Low Dressing Area Low Roasting Area 16 31 (lights on) 1 light bulb Moderate Main Production Area 140 (lights on) Four white fluorescent tube

47 Table 6 shows the illumination level of the different areas of the Alboco Food Industry. In evaluating the illumination of the facility, the proponents used a tool called Lux Light Meter. Based on the conducted tests, the illumination levels for deshelling area (30 lux), raw material storage area (20 lux), dressing area (16 lux) and roasting area (31 lux) resulted to low which indicates that these areas have insufficient and poor distribution of light. As for the main production area (140 lux), it resulted to a moderate illumination level which indicates that the area provides better lighting than the other areas but still not enough to the recommended lux level for manufacturing plants. Table 7. Noise Level of the Different Areas Area Noise (dB) Interpretation Deshelling Area 56 (machines are off) Low Raw Materials Storage Area 60 Low Dressing Area Roasting Area 60 Low Main Production Area 55 (Machines are off) Low 61.5 (Machines are off) Low Table 7 shows the noise levels of the different areas of Alboco Food Industry. A Sound Meter as a tool was used to measure the noise levels within the facility. The noise levels for deshelling area (56 dB), raw material storage area (60 dB), dressing area (60 dB), roasting area (55 dB) and main production area (61.5 dB) are low which indicate that all areas are safe and have no exposure higher than 110 dB that is recommended especially that personnel do not have any type of ear protection. C. Machines Alboco Food Industry has nine machines that are being used in the production. One of which is the deshelling machine. The deshelling machine is located in the deshelling area and its primary function is to remove the shells of the peanut. It has a dimension of 160 x 156 x 160 centimeters. The machine was purchased in 2018 and is currently functional. It is an automated type of

48 machine and is dependent on electricity. It has a capacity of 1 sack of peanuts which has a weight of around 50 kilograms per 15 minutes that can be processed per production. There is one worker assigned to operate the deshelling machine. Every after production, the machine is being cleaned to prevent machine breakdown. The roasting machine is placed in a 9.3 square meter roasting area that has no door and has small windows with one installed exhaust fan. Roasting machine is used to roast the peanuts either with shell or without shell and has a dimension of 250 x 185 x 165 centimeters. The machine was purchased back in 2016 and is still functional. It is operated using electricity and is an automated type of machine. The machine capacity is 50 kilograms per hour. One worker is assigned as the operator of the roasting machine which is also responsible for keeping it clean. As per observation of the proponents, the design of the machine has a small chimney which releases the heat to the roasting area which leads to increase the humidity inside the area. Another machine is the peeling machine which is located at the roasting area, and is used to remove the skin of the peanut after being roasted and cooled. It was purchased in the year 2019 and is currently under repair. The peeling machine is automated with a capacity of 50 kg per hour and is operated by one personnel. The Alboco Food Industry has three machines for the grinding process and one mixing machine for the mixing process. These machines are located within the main production area and arranged according to the flow of the production process; first grinding machine, mixing machine, second grinding machine, and third grinding machine, respectively. The first grinding machine is used to grind the peanuts into medium grind during the first grinding process. According to the owner, the first grinding machine was purchased in 1975 and it is made up of metal. During the interview, the owner stated that the Department of Science and Technology suggested not to use the old grinding machine since in today’s practice, it is recommended that the machines and equipment used are made with stainless materials and are now being used in food production. The first grinding machine works automatically with electricity as the source of energy and has a capacity of 30 kilos per hour, operated by one worker. The second grinding machine and third grinding machine are new and made up of stainless materials. The second grinding machine is used to

49 grind the mixture and meet the consistency of the crunch peanut butter. It was purchased in 2016 and currently functional. This grinding machine is automated with the use of electricity and has a capacity of 30 kg per hour that is operated by one worker. The third grinding machine was used to meet the consistency of the creamy peanut butter that was purchased in 2018 and still operational. This machine works automatically with the use of electricity and has a capacity of 30 kilos per hour with one worker as operator. As per observation, the machines have a distance of 0.50 meters to provide space for the production process. Moreover, there is a single mixing machine that is used in the production. It was placed between the first and second grinding machine in the main production area. The mixing machine is used to mix the ingredients of the peanut butter such as peanuts, sugar, coconut oil, and salt, and the ingredients of turon de mani such as peanuts, sugar and coconut oil. It was purchased in 2016 and is currently operational. As per interview conducted by the proponents, the owner stated that the machine is automated with the use of electricity and has a capacity of 50 kg per hour. This machine is also operated by 1 worker. Another machine used for production is the filling machine which is connected to the third grinding machine. The filling machine is located inside the main production area placed on a table. This machine is semi-automated because it requires manual operation with the use of a pedal to run the peanut into the bottles. It has a dimension of 55 x 30 x 85 centimeters and is also dependent on electricity. The filling machine is currently functional and was purchased in 2018. In this machine, one worker manually operates it using a pedal during the production. Based on the result of interview and observation, this machine has the capacity to fill in 270 bottles per 30 minutes. Additionally, the filling machine has a single nozzle that will fill the container of the peanut butter. The owner also stated that leaks on the hose already happened twice which caused delay to the operation. The last machine used during production is the sealing machine. It is used during the packaging process of the finished products. Its main function is to ensure that the products are secured on its packaging materials. The machine is situated in the main production area and is near the finished goods storage area. It was purchased in 2018 and is still functional which is operated

50 by one worker. This machine can process 300 bottles of peanut butter per hour and 500 packs per hour for both roasted peanuts and turon de mani. Machine maintenance is essential to ensure that machines are safe to use and to prolong its useful life. However, the Alboco Food Industry doesn’t practice proper maintenance for their machines. Based on the interview, the form of maintenance for their machines is by cleaning it every after use during production. Operators of the machines are the ones responsible for maintaining that it is cleaned after using and is inspected before starting the operation. When machine breakdown occurs, the owner immediately calls a machine shop to send a mechanic to fix the machine. However, if the problem of the machine cannot be fixed onsite, the owner is forced to send the machine to the shop and wait for a couple of weeks before it is ready for operation. Currently, the first grinding machine is not functional due to being old while the peeling machine is under repair. This may cause additional processing time and backtracking which could result in delays. D. Production Schedule Alboco Food Industry has 6 operating days in a week. From Monday to Saturday, the business operates starting from 7:30 in the morning until 5:00 in the afternoon. As per the data collected, the number of working hours of the business is 30 minutes beyond the standard working hours as required by the Department of Labor and Employment (DOLE). Thus, this implies that the total working hours on its daily operation is 8.5 hours and a total of 51 hours per week. Additionally, no manufacturing is done by the business on Sundays. The production of all their products such as the peanut butter, turon de mani, and roasted peanut is not being done simultaneously. Hence, daily production is carried out one product at a time. The target quantity of peanut butter is scheduled to be produced within the first three days of the week. Whereas, after the scheduled production for the peanut butter, two consecutive days are allotted in producing the turon de mani and the remaining one day is scheduled for the production of the roasted peanuts. As per the result of the observations and interview conducted, it reveals that 50% of the working days is allocated for the production of peanut butter, 33% is allocated for turon de mani, and 17% is allocated for the production of

51 the roasted peanuts. Peanut butter comes in three different sizes: 210 grams, 300 grams, and 630 grams. 1000 bottles for 210 grams, 840 bottles for 300 grams, and 300 bottles for 630 grams are the daily volume production targets. Since the business still takes into consideration the orders of its customers, the size of the peanut butter that they manufacture is not fixed for a given peanut butter production schedule. For turon de mani, the daily volume of production is 130 packs that consist of 20 pieces per pack. For roasted peanuts without shell, the daily volume of production is 226 packs for 130 grams and 65 packs for 300 grams. While for the roasted peanuts with shell, the business produces 160 packs for 300 grams and 110 packs for 500 grams per production. The owner also indicated that they use Just-in-Time (JIT) as part of their production management. Thus, this implies that there is a change of schedule for the production if there will be an increase in demand for a specific product. As per the interview, it is stated that the business responds to the customer demand by increasing the production of the products with high demand and reducing the production for the products with lesser demand. The delivery of products to their customers is being managed by the owner himself. Additionally, deliveries happen every first to second week of the month for grocery stores and supermarkets (SM, Gaisano, Robinsons, Metro Mart, etc.) in Tacloban City, every third week for other areas of Leyte, and every fourth week for bakeries like Quality Bread, Reyna’s and Mayong's. Furthermore, it was also stated that the owner has complete control over the manufacturing process of the business. The owner is the one who decides whether or not to change the production schedule in order to change the number of items that will be produced during a specific production period. E. Records Management Based on the interview conducted, the transactions of Alboco Food Industry are mostly not recorded including the daily time records of employees, procurement slips and distribution logs and payments for the orders. Furthermore, the business has no established policies and procedures for their records management. The owner only collects receipts upon the procurement transactions which are stored in a folder. These receipts are not properly organized and recorded for easier tracing. The last record documented was

52 also outdated and only written in a notebook. The practice of recording was not continued until the present times in which all transactions are being done only through verbal agreement. As the business does not have a contract signed with its distributors, the owner is struggling to collect the receivables. This increases the amount of receivables and decreases the cash on hand of the business that can be used in procuring necessary materials, equipment and machines needed by the business. Since there are no records, it is quite a challenge to trace the finances and other transactions made in the business. This leads to discrepancies on the amount of money that the business uses for the operation. Additionally, a committee for records management of the business is also unavailable which should be responsible for the monitoring and keeping of records. Moreover, no computer system is present that can be used to secure and organize data coming from its transactions. As well as no forms are available that can be used to easily record the data. This is the major problem of the Alboco Food Industry because it would greatly affect the business. It is necessary to have a well-established records management system to easily track business transactions. Tracking records is important to know the current status of the company and to determine the next steps to do. Alboco Food Industry regularly renews the permits needed for the business to legally operate. These permits include Business Permit, DTI Permit, FDA License to Operate and Certificate of Product Registration. The above mentioned permits are necessary for food manufacturing industries such as the Alboco Food Industry. In compliance with the FDA license is for the business to have a barcoding system. Based on the interview conducted, the business already has barcodes on the packaging of their products for the pricing of their distributors but does not have a computer system within their facility in which these barcodes cannot be used in inventory monitoring of the management. F. Raw Materials Alboco Food Industry procures its supplies of peanuts from a number of local municipalities as well as imports from other countries. During the interview, the owner stated that although several farmer cooperatives in the area supplies them, they still experienced a shortage of raw materials especially

53 on peanuts. In line with this, the owner has claimed that one of the causes of the peanut supply problem is that there are times when local farmers are selling their peanuts to other clients rather than supplying them. In addition, the owner stated that although they could expand their supply by selecting new suppliers, they opted not to do so, particularly considering that one of their goals is to support local farmers. Furthermore, the unit quantity and the replenishment of the raw materials do not have a specific level as a basis for placing an order. They are only repurchased if the supply of raw materials and packaging materials are already insufficient to produce the quantities of products that they need to provide in order to satisfy the demand. For example, they only procure raw materials if they are almost out of stock without considering that the lead time between the placement of their order and its delivery from their suppliers might arrive after 2 weeks or more. Additionally, the management of Alboco Food Industry does not know its Economic Order Quantity (EOQ). Also, the management does not consider the reorder point (ROP) as the basis of the replenishment process of its raw materials. When it comes to the quality of the raw materials being procured, the owner ensures that they are acquiring the best quality in order to produce good quality products. Furthermore, the owner has added that as the raw ingredients arrive at their facility, they are inspecting everything to assure its quality. However, it was noticed during the observation that the raw materials were kept in an open space along the entrance. Additionally, the space provided for the raw materials was seen to be small. The size of their raw materials storage measures 1.86 x 3.25 meters. It was also noticed that some goods such as a sack of sugar and salt were just directly stored on the floor. Moreover, it was observed that not all raw materials were kept in a single location and that some were preferred to be kept close to the area where it will be utilized. G. Inventory As per the conducted interview, the owner has mentioned that in ensuring that the raw materials are well-utilized and promote zero waste, they are executing First In First Out Method (FIFO) as part of their inventory management. The stocks that were consumed first are the raw materials that were delivered first in the facility. Additionally, when it comes to their products,

54 the first batch they have manufactured is also the batch of products that would be distributed first to their customers and resellers. However, it was stated that they are having difficulties when it comes to their inventory planning. The owner claimed that this is due to the fact that only one person manages their inventories which is also the owner. For instance, there are times when the facility needs to perform an inventory, but the assigned individual is typically unable to do so because he will also be the one distributing the products to their customers. When it comes to the inventory of their raw materials, the business do not follow a specific reorder point and economic order quantity, in which they are also having challenges in controlling the stocks on when to procure another set of raw materials especially that peanuts which are their primary raw material is seasonal and customer demand is continuously changing. When it comes to their finished products, they are having a good control with their inventory and the owner has also added that it is because they are utilizing a Just-In-Time inventory into which the volume of their production is based on demand. Additionally, when it comes to the inventory of their raw materials, work-in-process, machine and equipment, and finished products, they are just taking notes and counting it mentally. Furthermore, the results of the conducted interview and observation reveals that they are not using any form in tracking and monitoring the movement of the raw materials, finished products and all the items in the facility that are used in their operation. Additionally, the owner has added that there are times that they are in need of historical data for their inventory management, but they cannot obtain adequate data. This is due to the fact that the owner frequently forgets important details needed for inventory management since he only stores inventory-related information in his mind. Moreover, barcodes in a manufacturing industry increase the accuracy of the records in the inventory and increase a good control in real-time inventory. It was observed that the products of Alboco Food Industry have their own barcodes. But it was noted by the owner that those barcodes have no connection with their inventory management. They are only using the barcode in order to comply with the requirements and policy of the Food and Drug Administration (FDA).

55 H. Personnel The Alboco Food Industry employs a total of eight workers, two of them are indirect labor and the other six are direct labor. As per the interview, the owner stated that their workers receive Php 300.00/day salary under a No Work, No Pay Policy. The owners have also shared to the proponents that the only incentives that they can provide is the year-end-bonus of their workers. SSS, Pag-IBIG and Philhealth are not included in the benefits that they are providing for their employees. Additionally, the only training provided to their employees is the training for each new hire on how to perform the jobs that will be assigned to them. Moreover, the management has given the workers personal protective equipment that will be worn during the entire production time in order to ensure their safety, as well as the safety of the product they are handling. The dressing room of the workers has a tight space with some unnecessary equipment, such as a washing machine. The room could only accommodate one person at a time, and it is located between the raw materials storage and the roasting area. When it comes to material handling, most of the time the workers handle the items manually; however, a pushcart is available for handling much heavier material. The workers are working 8.5 hours a day, starting from 7:30 in the morning up to 5:00 in the afternoon. The working days of the business are from Monday to Saturday. They have an hour-long lunch break from 12:00 NN to 1:00 NN. A fifteen-minute break is also given to the employees from both morning and afternoon working hours. For personnel requirements, it was observed that the facility’s comfort room is located outside the production area, making it difficult for the workers to access. It was also noticed that the management does not provide a water dispenser for their personnel where they can get water from. Furthermore, the veranda, which is affixed to the facility's office building outside, is where employees can go during breaktime. Alboco Food Industry has its sanitary permit to operate since it is a food service establishment from Local Health Authority of Tacloban City in pursuant to the Code of Sanitation. In line with this, the issuance of health certificates for food handlers is a requirement of the management as part of their personnel management. Included in the issuance of health certificates for food handlers are the laboratory examination results for urinalysis, fecalysis/stool, chest X-Ray, and HEPA tests. The validity of

56 health certificates for food handlers is up to 1 year. Hence, the establishment requires its workers to submit an updated health certificate annually. I. Management Practices Planning The Alboco Food Industry’s management and workers convene to plan out the necessary actions and solutions to the problems existing in the industry. Monthly Executive Meeting is conducted to discuss the important matters such as production schedule, raw materials and other issues concerning the production process of the industry. This also builds strong relationships with the workers since there is constant communication between the management and the workers to ensure that all personnel are working towards a common goal. The Alboco Food Industry’s personnel are committed to ensuring that all actions are in accordance with the plans made by the team. Organizing In the Alboco Food Industry, the plans are organized to be implemented effectively. Decision Making is done in assigning the workers and giving the duties and responsibilities to ensure that the personnel work efficiently and effectively. They also prepare and conduct training and seminars to the new personnel. Monitoring of the work progress is constant to ensure the production is running smoothly. Leading The existing organizational chart of Alboco Food Industry shows an imbalanced division of duties and responsibilities of the personnel. The manager holds four major positions, other personnel hold only one minor position. The management is not strict when it comes to the other responsibilities of the workers; they just focus on the production of the products. Moreover, the mission and vision of the industry do not reflect or are not aligned with their goal as a manufacturing industry. Additionally, it is not measurable, attainable, realistic and time- bound which are the guides in creating the mission and vision of the company.

57 Staffing The Alboco Food Industry’s hiring policies are not in accordance with the standard hiring policies of the manufacturing industries. The standard hiring policies will not be effective since the management refers to hiring people they know and are referrals from a friend. They don’t follow the proper hiring process; as long as they like the applicant and have the recommendation of an acquaintance, they will consider and hire the applicant. Moreover, a health certification from the city health office must be furnished as one of the requirements of the industry. Controlling Alboco Food Industry ensures that all the processes are under control. Controls are implemented effectively, but there are some important controls that the Alboco Food Industry lacked and missed. Safety Food Controls are important to the industry because they are producing food products. According to the observations conducted within the facility, they implement some rules of OSH such as posting of signage and wearing of personal protective equipment. However, they failed to install water sprinklers, evacuation routes, and fire alarms. They have no safety and health committee that will create and evaluate a safety program to ensure the safety of the personnel as well as the facility. The windows and doors have screens to prevent insects going inside. For ventilation, the facility lacks exhaust fans in some areas. Alboco Food Industry ensures that the facility follows the Good Housekeeping Policies for food industries. There are things that are restricted inside the production area, such as jewelry, piercings, phones, etc. The regular cleaning is done to maintain the cleanliness of the facility. A double door is installed so that it will be easy for the finished product to be transported from inside to outside for distribution to the retailers. The waste management of the Alboco Food Industry ensures that the waste is being used for other purposes. They ensure that the facility practices zero waste manufacturing and 5R (Refuse, Reduce, Reuse, Repurpose, and Recycle).

58 Table 8. Good Manufacturing Practices (GMP) CATEGORY M INTERPRETATION Facility Premises 2.60 Good Design and Construction 2.88 Good Equipment & Utensils 2.77 Good Sanitary Facilities 1.77 Fair Sanitary Operations Personnel 3.5 Very Good Overall M 2.70 Good Table 8 shows data on the conformance of the good manufacturing practices present and implemented by Alboco Food Industry to the guidelines of GMP. As indicated in the table, the evaluation of their GMP is interpreted as ‘good’ (M = 2.70). The table also displays that the establishment have a ‘very good’ interpretation when it comes to their sanitary operations and personnel (M = 3.5), a ‘good’ interpretation when it comes to their facility premises (M = 2.60), decision & construction (M = 2.88), equipment and utensils (M = 2.77), and a ‘fair’ interpretation with their sanitary facility (M = 1.77).

59 Chapter V FINDINGS, CONCLUSION AND RECOMMENDATION This chapter shows the discussion of the study’s significant findings. Moreover, conclusions and recommendations were also presented. Findings Based on the data gathered, the researchers were able to understand the whole operating system of Alboco Food Industry. A summary of the findings in this study is presented as follows: A. Production Process 1. The Alboco Food Industry executes a batch type of production. 2. The volume of the production changes depending on the demand of the customers, and they prioritize the products that are in demand. 3. The grinding and its following processes require an average of 7 repetitions to reach the target daily production. 4. The production processes one product at a time. 5. The facility has no available power generator to be used when power outages occur within the area. 6. Alboco Food Industry receives ready to deshell peanuts from the suppliers. 7. Only one personnel sorts and inspects the deshelled peanuts and is done manually. 8. The roasting process takes place in a small area which has a high temperature coming from the machine. 9. The cooling process of roasted peanuts is done in the same area where the roasting process takes place. 10. Peeling process is done manually inside the roasting area because the peeling machine is under repair. 11. The three-grinding process is carried out with only two grinding machines because one of the facility's grinding machines is no longer in use due to its age. 12. The mixing process is done using a mixing machine with a capacity of 50 kg per hour.

60 13. The filling process uses a filling machine which is semi-automated where workers manually use pedals to fill the peanut butter into the containers. 14. The cooling process of the peanut butter is done on a stainless table with the use of two stand fans. 15. The wrapping process of the turon de mani is done manually. 16. The workers are not wearing hand gloves when wrapping the turon de mani. 17. In the frying process, a small frying pan and a stove is used to manually fry the turon de mani. 18. The oil used in the frying process is being reused by the owner as their own cooking oil. 19. The packaging materials for roasted peanuts are zipped pouch bags that can still be closed by the customers if they want to. B. Production Design and Layout 1. The Alboco Food Industry adopted the product layout design to their facility layout. 2. The deshelling area located outside the manufacturing plant has no door and with broken walls. 3. The raw materials storage has a small space that houses the raw materials which are just placed on the floor. 4. The dressing room has the smallest space which is only 5.3% of the total facility area and is occupied with unnecessary equipment. 5. The dressing room has no electric fan provided for its employees. 6. The roasting area has a high temperature from the heat emitted by the roasting machine with only two windows and one exhaust fan available for ventilation. 7. The cooling and peeling process is done in the roasting area. 8. The aisles of the facility are narrow. 9. The arrangement of the areas and machines within the main production area is based on the sequence of the production process. 10. The frying area has a distance of 4 m from the wrapping area. 11. The floors inside the production area are coated with non-slippery paint. 12. Signage including the production rules and names of the areas is visible.

61 13. Alboco Food Industry is formerly a residential house and is converted into a production facility. 14. Comfort room is located outside the facility. 15. Areas within the facility have low to moderate illumination levels. 16. Areas within the facility have low noise levels. C. Machine 1. The grinding machine of Alboco Food Industry has a capacity of 30 kg per hour while the roasting, mixing, and peeling machines have a capacity 50 kg per hour. 2. The peeling machine is not functional and is under repair. 3. The machines in the main production area have a distance of 0.50 meters between them. 4. The facility needs to use 3 grinding machines for the production of their crunchy and creamy peanut butter. 5. The first grinding machine is not functional because it is old and not made up of stainless materials. 6. The filling machine is connected to the third grinding machine and is semi-automated. 7. The hose in the filling machine has leaked twice since they purchased it. 8. The Alboco Food Industry does not practice proper machine maintenance and their way of maintaining the machines is by cleaning every after use and conducting inspection before the start of production. 9. Alboco Food Industry has no resident mechanic to immediately repair the machine. D. Production Schedule 1. The business operates 6 days in a week starting from 7:30 in the morning until 5:00 in the afternoon. 2. The production schedule of Alboco Food Industry allocates the first three days for the production of peanut butter, followed by the turon de mani, and roasted peanuts for the other days. 3. Alboco Food Industry is practicing JUST-IN-TIME in its production management.

62 4. The business prioritizes the products that are in demand. 5. Alboco Food Industry schedules their delivery in different areas and resellers per week. E. Records Management 1. The Alboco Food Industry has no record management system that is being implemented. 2. The business doesn’t have both a physical and electronic record system. 3. Business transactions are done verbally. 4. No forms and tables are available for use to track the different transactions done by the business. 5. Alboco Food Industry regularly renews permits needed by the business. 6. The barcodes that can be seen in the finished products are only for the pricing but not for inventory and monitoring of the products. F. Raw Materials 1. The suppliers of raw materials for Alboco Food Industry are from local municipalities within the region and sometimes imported from nearby countries. 2. The Alboco Food Industry experiences a shortage of raw materials especially the peanuts. 3. Alboco Food Industry only repurchased raw materials when it is insufficient. 4. The business doesn't have a specific reorder point and economic order quantity for their raw materials. 5. Inspection is done upon the arrival of raw materials in the facility. 6. The raw materials are stored in their small raw material storage area and are placed on the floor. 7. Some raw materials are kept close to the area where it is used. G. Inventory 1. Alboco Food Industry utilizes First In, First Out Method (FIFO) as part of their inventory management.

63 2. The person who handles the inventory management is also the owner/manager of the business. 3. Alboco Food Industry does not follow a specific reorder point and economic order quantity as part of their inventory management. 4. Alboco Food Industry has no proper inventory management on raw materials, finished products, work in process, and machine and equipment. 5. The barcodes on the products of Alboco Food Industry have no connection with their inventory management and are only used in compliance with FDA regulations. H. Personnel 1. The workers receive a salary of 300 pesos per day under a no work no pay policy. 2. Alboco Food Industry only provided a year-end bonus as incentives to its workers. 3. SSS, Pag-IBIG, and PhilHealth Insurance are not included in the benefits provided for the employees. 4. Alboco Food Industry only provides training to its newly hired employees. 5. Alboco Food Industry provides personal protective equipment to all employees. 6. The dressing room for the workers has a small space and is occupied with unnecessary equipment. 7. The workers are working 8.5 hours daily from Monday to Saturday having an hour for their lunch break and a 15 minute break both morning and afternoon working hours. 8. The comfort room is located outside the facility. 9. The Alboco Food Industry does not provide water dispensers in the facility. 10. Alboco Food Industry has a sanitary permit from Local Health Authority of Tacloban City in pursuant to the Code of Sanitation.

64 I. Management Practices 1. Alboco Food Industry conducts monthly executive meetings to discuss its plans. 2. Plans of the Alboco Food Industry are organized to be implemented effectively. 3. The existing organizational chart of Alboco Food Industry shows imbalance in division of duties and responsibilities. 4. Alboco Food Industry’s mission and vision of Alboco Food Industry does not reflect the goals of the manufacturing industry. 5. The Alboco Food Industry has no proper hiring procedure. 6. Alboco Food Industry implements rules of OSH such as posting of signages and wearing PPE. 7. Alboco Food Industry failed to install water sprinklers, evacuation routes and fire alarms. 8. Alboco Food Industry has no safety and health committee. 9. Alboco Food Industry lacks an exhaust fan for ventilation. 10. Alboco Food Industry follows good housekeeping policies. 11. Alboco Food Industry practices zero-waste manufacturing and 5R. 12. Alboco Food Industry shows good manufacturing practices. CONCLUSIONS Based on the findings presented, the following conclusions were drawn: A. Production Process 1. The Alboco Food Industry utilizes batch type of production, which indicates that they cannot produce all types of products simultaneously because of their small capacity machines that repeat their production processes. 2. During power outages, interruption occurs for the production of products that use power dependent machines. 3. The raw materials for the Alboco Food Industry, which are peanuts, are deshelled and sorted as soon as they arrive, eliminating the need for washing and drying within the facility. Deshelled peanuts are sorted and

65 inspected by one person only, which will take more time and not guarantee 100% accuracy. 4. The roasting area of Alboco Food Industry where the roasting process takes place along with the cooling and peeling process has a small space and high temperature which results in traffic and puts the safety of its workers at risk. 5. Since the peeling machine is under repair, the peeling process is done manually that adds time and delays to the production process. 6. The grinding process also involves backtracking and production delays since there are only two grinding machines available for use because the first one is old and not functional. 7. Due to the machine's limited capacity, repetitions on the mixing process also occur to reach the production volume. 8. The machine used for the filling process is semi-automated which implies that a worker is necessary to manually operate the machine. 9. The cooling process takes a longer time to be completed since the facility only uses 2 electric fans as equipment for cooling. 10. Wrapping process takes the longest time to perform in order to produce the target volume for the turon de mani. 11. Lack of PPE during production might cause food contamination in the facility. 12. Due to the frying pan's small capacity to hold turon de mani, the process takes longer to complete. 13. The roasted peanut with shells and without shells produced by Alboco Food Industry comes in convenient packaging for consumers. B. Production Design and Layout 1. The deshelling area is inappropriate as an area for food production since it is not well-built. 2. Small spaces in areas like the aisles, dressing rooms, roasting area, and raw material storage cause traffic and bottlenecks for workers. 3. The raw materials are not properly stored. 4. Both the dressing room and roasting area are not well-ventilated.

66 5. The cooling and peeling process takes up additional space in the roasting area. 6. The distance of the frying area from the wrapping area causes a longer travel time. 7. The floor of the facility follows the requirement when it comes to facility safety and the visual management enables the workers to be reminded of the rules in the production. 8. The building of Alboco Food Industry is not intended for a manufacturing facility. 9. The comfort room in Alboco Food Industry is not easily accessible for their workers. 10. Alboco Food Industry is not following the 200-500 lux standard illumination level for manufacturing facilities. 11. Alboco Food Industry is below the 85dB maximum noise level which is advisable for the health of the workers. C. Machine 1. The machines used for production in Alboco Food Industry have small capacity and cannot meet the target demand which results in repetitive processes. 2. The machines at Alboco Food Industry are provided with enough space. 3. Alboco Food Industry has only two grinding machines available for their three grinding processes. 4. The semi-automated filling machine requires a worker to manually operate it since it is semi-automated. 5. Machine breakdown could frequently occur due to poor machine maintenance and a lack of a resident mechanic, which happened to their peeling and filling machine that resulted in manual peeling and increase on production time and delays. D. Production Schedule 1. Alboco Food Industry operates extra time at work than the standard working hours as mandated by the Department of Labor and Employment (DOLE).

67 2. The Alboco Food Industry only produces one product every day, indicating that they are unable to make different kinds of products simultaneously. 3. The Alboco Food Industry prioritizes producing the products that are on demand and its bases for their volume of production in order to prevent overproduction from occurring. 4. The delivery schedule of Alboco Food Industry is based on the area and type of resellers. E. Records Management 1. Alboco Food Industry has poor records management that would result to difficulties in managing and tracing transactions and finances. 2. Alboco Food Industry complies with requirements of the government in line with the business. 3. The barcode in the product has no direct purpose in the records management of Alboco Food Industry. F. Raw Materials 1. When there is a local supply shortage, Alboco Food Industry solely purchases raw materials from foreign suppliers. Production halts as a result of a raw material shortage. 2. The lack of ROP and EOQ throughout the procurement process could cause the business to overspend and incur unnecessary expenditures when buying its raw materials. 3. Raw materials are subjected to inspection upon arrival to ensure its quality. 4. The raw materials of Alboco Food Industry are not all stored in its raw materials storage. Some are placed and inappropriately stored near the areas where it is needed. G. Inventory 1. The First In, First Out Method (FIFO) of Alboco Food Industry is a good practice to ensure that their resources are well-utilized.

68 2. The person in charge of managing the inventory could be overloaded with duties. 3. Alboco Food Industry cannot monitor the number of stocks currently available and when to repurchase the materials needed, at the same time the quantities of finished products, work in process, and machine and equipment. 4. Alboco Food Industry complies with FDA's rules and specifications, yet the barcode on their goods has no bearing on how they manage their inventory. H. Personnel 1. Alboco Food Industry doesn’t follow the provincial minimum wage as required by the Department of Labor and Employment. 2. The management lacks a well-established strategy and programs for motivating and ensuring the welfare of its employees. 3. The Alboco Food Industry has no established regular training programs for its employees to enhance their skills. 4. The PPEs provided by Alboco Food Industry are being stored in the dressing room which does not meet the standard size and is occupied with unnecessary items stored inside the room. 5. The business is operating half an hour beyond the DOLE-mandated standard daily working hours. 6. Alboco Food Industry is unable to meet adequate personnel requirements having no available water dispenser and comfort room inside the facility. 7. Good sanitary practices enables the Alboco Food Industry to ensure safe food handling. I. Management Practices 1. Alboco Food Industry will be able to ensure that they conduct regular planning and assure that all their decisions and actions are in accordance with their plans. 2. The Alboco Food Industry failed to equally distribute the number of duties and responsibilities causing other employees to do more work.

69 3. The Alboco Food Industry’s mission and vision have a little impact on the performance of the company. 4. Alboco Food Industry could possibly hire incompetent workers. 5. Alboco Food Industry is able to comply with the proper visual management guidelines set forth by OSH, but they failed to set up a safety and health committee within the facility. The business also failed to provide fire safety equipment which is important for the safety and health of the workers. 6. The facility of Alboco Food Industry has no proper ventilation. 7. Alboco Food Industry ensures the cleanliness within the facility and promotes an environmentally friendly workplace. 8. The Alboco Food Industry is able to ensure the safety for their workers and safety for their products especially that they are producing food products.

70 Analysis on the Proposed Layout The table below shows the comparative analysis of the Existing Layout and Proposed Layout of the Alboco Food Industry. The justification is also presented to distinguish the improvement of the operation in the proposed layout compared to the existing layout. Existing Layout Proposed Layout Justification The deshelling It has a window and The management will area has no door Door that will prevent prevent spreading of the and window to rats and insects from dust that came from the prevent insects going to the deshelling machine and ensure no and rats. area. contamination will occur. Deshelling Area The location of the deshelling area is placed in a The deshelling area is Since the deshelling temporary now placed in the area is placed in the main building. main building, the building. process will be faster. The storage has a The storage room has The management can narrow space a bigger dimension to store more raw materials which limits the store the raw for the business and capacity to store materials. there will be no delay on more materials. procurement of the raw Storage Room The area is now in materials. The area has no closed space and has door and in open a door to prevent rats The management will be space were and insects able to ensure that no exposed to rats contaminating the contamination coming and insects. materials. from rats and insects will go to the materials. The locker room is The locker room is The management will be able to have a secure too narrow and wider and has and safe place for the workers personal small for the cabinets to store the belongings. workers to store personal belongings This will help the management to prevent Locker Room their personal of the workers. delay and shorten the travel distance of the belongings. workers. A comfort room is The room has no placed inside in the comfort room for locker room for the the workers. workers.

71 The roasting area The roasting area is in The management will be has no doors that a closed room and able to control and separate from the has a door that minimize the heat which other area. The separates the other occurs during the heat spread in the areas. It controls the production process. main building heat spreading to the during the main building. The management will operation. have more space for the The dimension is possible upgrades of the Roasting Area The area is narrow bigger to have better roasting machine and which limits the movements of the enough space for the movement of the workers. worker for a better workers. production process. The installed exhaust The humidity in fan and windows will The management will be the area is hot control the airflow in able to provide a safe during the roasting the area. working condition and operation. eliminate the risk to the workers and to the product. The size of the The dimension of the The management will production area is production area is have capability to just fit enough for bigger for better upgrade their machines Production Area the machines that production flow. or apply automated they going to use production since there is for the production. a bigger space. This will give a better production process. The goods were There is a safe room The management can ensure that the product stored beside the where the finished is placed in a clean and safe area. They can also Finished Goods exit door. They goods can be stored properly monitor the Storage use a basket and safely and prevent finished goods since it stock them. contamination. will be placed in a room type storage area. The current office The office is located The management can is the owner’s near the production have a proper place to personal room. area. This office will deal on business Office serve the admin office transactions. This office The owner’s used where they can also will help the its personal store their business management easily computer for the records and can have monitor the production business. a business line since it is near the transaction. production area.

72 Office computers are The management can installed to ensure the have the ability to store data of the business is business records and safe and secure. transactions properly since there is an office computer. This area is The peeling area is The management will placed inside the now placed in a have a fast-cooling roasting area. The different room beside process and peeling of process takes the roasting area. It is peanuts since there is a place after the well ventilated for a designated place for this Peeling Area roasting and better and faster process. This also cooling process. cooling process. improves the production process since the worker will no longer wait many hours just to cool and peel the peanut.

73 RECOMMENDATIONS Based on the conclusions drawn from the study, the following recommendations are given: A. Production Process 1. The Alboco Food Industry should increase its machine capacity to meet the customer’s demand and to produce all types of products in just a single production day. (See Annex A for the proposed machines) 2. The Alboco Food Industry should provide a generator in case of power outages. (See Annex B for sample generator) 3. The Alboco Food Industry should consider assigning additional personnel for the sorting process. 4. The Alboco Food Industry should consider allocating separate areas for peeling and cooling processes and design a well-ventilated roasting area while increasing its dimension. (See Annex C for the proposed production layout) 5. The Alboco Food Industry should have a resident mechanic that can immediately respond to machine breakdown. 6. The Alboco Food Industry should purchase additional grinding machines with higher volume capacity so that three grinding machines will work on the three-grinding process in the production flow. (See Annex A for the proposed machines) 7. The Alboco Food Industry should consider purchasing a new mixing machine with higher volume capacity to avoid repetition of process. (See Annex A for the proposed machine) 8. The Alboco Food Industry should change their filling machine into an automated machine to reduce its needed number of workers. (See Annex A for the proposed machine) 9. The cooling process for peanut butter must be done in a well-ventilated area to lessen the required cooling time. (See Annex C for the proposed production layout) 10. The Alboco Food Industry should have a wrapping machine for turon de mani to minimize the time allocated for the wrapping process. (See Annex D for sample wrapping machine)

74 11. The Alboco Food Industry should provide the workers with nitrile gloves to ensure food safety. (See Annex E for sample gloves) 12. The Alboco Food Industry should replace their frying equipment with a stainless steel deep fryer that can accommodate a higher capacity of turon de mani. (See Annex F for sample fryer) B. Production Design and Layout 1. The Alboco Food Industry should provide a well-constructed area for the deshelling process that will ensure food safety. (See Annex C for the proposed production layout) 2. The Alboco Food Industry should redesign the facility and reorganize the visual management of the production area to provide sufficient space for each process step which also considers the standard width for aisles and size for dressing room based on the number of workers. (See Annex C for the proposed production layout) 3. The Alboco Food Industry should provide material handling equipment in the raw material storage. (See Annex G for sample material handling equipment) 4. The Alboco Food Industry should have a centralized air condition that will provide good ventilation and support the operations of machines and workers, as well as the cooling process of the products. (See Annex H for sample air condition) 5. The Alboco Food Industry should allocate separate areas for the peeling and cooling processes. 6. The Alboco Food Industry should position the frying area beside the wrapping area to eliminate additional travel time. (See Annex C for the proposed production layout) 7. The Alboco Food Industry should provide comfort room inside the production facility. (See Annex C for the proposed production layout) 8. The Alboco Food Industry should install additional fluorescent lamps to enhance the lighting and increase productivity. (See Annex I for the proposed fluorescent lamps)

75 C. Machines 1. The Alboco Food Industry should purchase new machines that have higher machine capacities to avoid backtracking and process repetitions. (See Annex A for the proposed machines) 2. The Alboco Food Industry should purchase additional grinding machines with higher volume capacity to avoid backtracking and ensure smooth flow of production. (See Annex A for the proposed machines) 3. The Alboco Food Industry should consider having an automated filling machine that will lessen the required number of workers. (See Annex A for the proposed machines) 4. The Alboco Food Industry should implement proper machine maintenance and schedule to avoid unexpected machine breakdowns and a resident mechanic in case of machine repair. (See Annex J for proposed machine maintenance schedule) D. Production Schedule 1. The Alboco Food Industry should adopt the standard working hours of the Department of Labor and Employment. 2. The Alboco Food Industry should purchase new machines that have higher machine capacities that will allow the business to produce all types of products in just a single production day. (See Annex A for the proposed machines) 3. The Alboco Food Industry should maintain using Just-in-Time as part of the production management to avoid overproduction. E. Records Management 1. The Alboco Food Industry should implement a proper record management system to easily track its transactions. Physical records and database systems should always be available to secure records for transparency purposes. 2. The Alboco Food Industry should have forms that are used in documenting information and data from all the transactions, that includes the daily time of employees, procurement order, order slip, equipment

76 maintenance log and distribution log sheets must be available. (See Annex K-O for the samples) 3. The Alboco Food Industry should implement a barcoding system for the inventory monitoring of the business. (See Annex P for barcode samples) F. Raw Materials 1. The Alboco Food Industry should consider procuring from suppliers coming from other regions if raw materials are being offered at lower prices but with the same quality. 2. The Alboco Food Industry should practice using Reorder Point (ROP) and Economic Order Quantity (EOQ) as bases for their procurement. (See Annex Q for sample formula) 3. The Alboco Food Industry should properly store all its raw materials inside its raw material storage. G. Inventory 1. The management of Alboco Food Industry should distribute other responsibilities to its personnel and provide training related to the tasks assigned. 2. The Alboco Food Industry should practice using Reorder Point (ROP) and Economic Order Quantity (EOQ) as bases for their inventory to easily track supplies available . (See Annex Q for sample formula) 3. The Alboco Food Industry should establish a proper inventory management system for the Inventory of Raw Materials, Finished Goods, Work-In-Process and Machine and Equipment to constantly track the resources. (See Annex R-U for the samples.) 4. The Alboco Food Industry should implement a barcoding system for their inventory monitoring. (See Annex P for barcode samples) H. Personnel 1. The Alboco Food Industry should adhere to the standard minimum wage in the province which is provided by the Department of Labor and Employment.

77 2. The Alboco Food Industry should provide other incentives including PhilHealth Insurance, SSS Insurance, applicable leaves, and awards like Worker of the Month in order to boost the worker’s morale. 3. The Alboco Food Industry should provide regular training to its workers in order to improve their skills and capabilities, allowing the workers to perform their assigned tasks effectively. 4. The Alboco Food Industry should adhere to the dressing room size standards that can be determined with the number of employees and allows only necessary equipment to be placed within the room. 5. The Alboco Food Industry should follow the 8-hour working time provided by the Department of Labor and Employment. 6. The Alboco Food Industry should provide the personnel requirements such as comfort room and water dispenser within the production area for easier access. (See Annex V for sample water dispenser) I. Management Practices 1. The Alboco Food Industry should arrange and establish a new organizational chart that distributes the duties and responsibilities equally. (See Annex U for sample organizational chart) 2. The Alboco Food Industry should establish a new Mission and Vision that would help to reach the goals of the business. (See Annex V for the proposed Mission and Vision) 3. The Alboco Food Industry should have proper hiring policy to hire the right workers for the business. 4. The Alboco Food Industry should install water sprinklers and fire alarms. (See Annex W for samples) 5. The Alboco Food Industry should establish a Safety and Health Committee that will supervise safety procedures within the facility. 6. The Alboco Food Industry should have a centralized air condition for a well-ventilated facility.

78 ANNEX A Proposed Machines Grinding Machine

79 Roasting Machine Peeling Machine

80 Mixing Machine Filling and Packaging Machine

81 ANNEX B Proposed Generator

82 ANNEX C Proposed Production Layout

83 ANNEX D Proposed Wrapping Machine ANNEX E Nitrile Hand Gloves

84 ANNEX F Proposed Stainless Steel Deep Fryer ANNEX G Proposed Material Handling Equipment Storage Racks

85 Industrial Trolley ANNEX H Proposed Air Conditioning

86 ANNEX I Proposed Fluorescent light ANNEX J Proposed Machine Maintenance Schedule Machine Mon Tue Wed Thu Fri Sat Sun Deshelling Machine Roasting Machine Peeling Machine Grinding Machine Mixing Machine Filing Machine Sealing Machine

87 ANNEX K Daily Time Record