Social Value Simulation of the Philippine Community-Based Social Enterprise Using Value Chain Analysis

Abstract

Through a case study of a coffee cooperative, the researchers simulated how a community-based social enterprise (CBSE) creates social value by measuring the positive returns of its existence to the society as a solution to unequal distribution of income and rural unemployment. By extending the CBSE’s value chain, more significant social benefits are provided to the society by generating additional employment, especially for indigenous peoples in countryside areas. Nonetheless, the free market failed to deliver such socioeconomic advantage. Moreover, social enterprise products are not at par with mainstream supermarkets, adversely affecting indigenous laborers due to an uninformed market concerning the social benefits it tends to contribute to society. Such market failure can be conciliated through the creation of intra-value chain within the CBSE. With this pioneering study in one of the coffee regions in the Philippines, the Keynes multiplier simulated the impact of per peso invested on the new chain of operation. The relevance of an institutional enterprise was also emphasized. This research concluded that the creation of new value chain focused on providing consumer’s value for their money through intra-trading of products in the countryside offers the consumer an authentic experience of contributing to CBSEs which can boost a better long-term consequence.