PROFILE NO. 1- MELCHOR ADOLFO PAHULAYA

Mel was excited when he graduated from the Academy sometime in the year 2001, he was able to practice the business rules of thumb right away when an opportunity came to start a janitorial supplies distribution and a cleaning services business. He was excited to travel the road to self reliance so that he would be able to marry the girl of his dreams in the Manila Temple, start a family and serve His Maker.

Working 15-18 hours a day building his business with a partner definitely was not an easy task. They labored night and day delivering supplies to their customers and supervising people that handled their contracts. One of their contracts was to provide cleaning services to the Church. After several months of effort, Mel felt that he was no longer in control of his life anymore. They neglected the rule of thumb ‘pay yourself first’ and did not write down a partnership agreement. Everything turned to ashes one night, when he and his partner had a huge fight; painful words were uttered and an awful scene of who did the most work came into play. Mel left the business disgruntled. As anticipated, the partner did not pay him his share of the business profits.

After that incident, Mel went off to Luzon (northern part of the Philippine islands) to find employment and get his life together.

In the summer of 2004, Mel came in touch with one of his Mission buddies who was living in Zamboanga City (southwestern tip of the Philippines) and who after presenting a simple business plan, invited him to start a business venture. Mel was hesitant at first since his still felt his scars in the realm of business failures and the fact that he was doing really well in his employment in Luzon (north of the Philippines) left him with uncertainty. His heart soon took courage since the woman that she would be marrying resided in the same city and they had made an agreement to settle in this city, with him giving up his job. After calculating the odds of the move, Mel took the plane to Zamboanga City and worked to execute the business plan that his friend had presented.

The plan was simple: a new US Fast food chain was opening shop in the City and they needed a vegetable supplier. His friend won the contract and from this, they went to work. Mel worked IN the business as the 1st employee while his mission mate worked ON the business as the 2^nd employee. Since both of them had undergone training from ACE, they knew the difference and understood that a business start-up needed to cover both areas of the INS and OUTS of the business.

It was Christmas season 2004, when Mel took his fiance to the Manila Temple and since the thriving business needed attention, had to cut short their honey moon.

Mel focused on the day to day operations of the business, kept a balanced inventory system, ensured quality packaging and delivered the goods to the clients everyday. They had learned to make financial statement projections while they were at the Academy and so they projected their cash flow and income statements carefully so as to be able to create strategies. Capital funds were limited, they only had a combined savings of approximately 50,000. They were literally empty handed in terms of equipment that they needed to use for the day to day operations of the business however, they did not lose hope since after doing the mathematics, they approached a contact in their network that loaned money at 3% a month (36% per annum). Their projected financial statements told them that the business would be able to bear such a high interest and still have funds left over. They needed fixed assets like huge chest type freezers and a vehicle to use to deliver their goods and solved this by finding an appliance store that offered installment plans payable for 12 months. They also found a contact in their network that agreed to offer a 6 month 0 interest installment plan on a mini pick-up vehicle (also known as a multicab). Because of the training they had received in projecting financial statements, both partners were able to address pressing challenges that a business start-up always encounters and they were able to stretch their limited cash base.

All was not well along the way, there were instances that there were cash problems and cash emergencies. But by keeping a constant watch on their payables and receivables, they were able to manage such shortages. The most memorable instance in Mel’s mind was the time that he had to pawn his wedding ring so as to be able to make supplier payments the next day. Experiences like these, turn boys into men.

The partner working ON the business was able to get all the necessary business permits. And since this was a start-up venture, it took 2 months before they could be given their first Official Receipt booklets which meant that 60 days worth of inventory was already given to the client without billings. They were able to manage this by bearing in mind the rule of thumb ‘delay payments to suppliers as much as possible.’ More clients were also added to their portfolio, the big Sardine factories also were asking for vegetable supplies while the first fast food chain client opened it’s 2^nd outlet after 12 months thus increasing sales.

Mel is smarter in his business this time and so, he pays himself a salary from the business and follows another rule of thumb called ‘practice separate entity’. He works full time at his job in the business and manages people as he continues to build this company that he helped start in 2004. Today, that company has a net worth of 5 Million Pesos (US$ 100T ) and by managing the finances of the business and using annual profits to expand to other ventures, Mel is able to become self-reliant and is able to magnify his calling as the President of one of the Branches in the Zamboanga Stake. By constantly improving in his financial education, improving in his business skills and sharing what he knows, Mel is quite confident with the decision he made to educate himself in the realms of business which started in the halls of the Academy for Creating Enterprise.

(In the picture, Mel Pahulaya with his wife opening one of their expanded business ventures.)