Interim Report

Social Innovation Challenge

Group 2
Abdelrahman Said
Matthew Kerner
Adrian Cheung
Nikita Kochnev
David Boroto

February 27th, 2019

1.0 Problem Statement
This section provides a detailed description of the problem.  

The Philippines is ranked as the third worst plastic polluter in the world, behind only China and Indonesia,
contributing nearly two million tonnes of mismanaged plastic waste every year to the global ocean plastic
problem [1]. The Philippines is also home to poorly managed waste facilities and informal dumpsites. This
issue is further compounded by the lack of awareness and lack of effort from both the government and
citizens to institute and follow appropriate waste management systems.
The project focuses on two communities, Sto. Nino Sur and Sto. Nino Norte, which are particularly poor at
effectively managing the waste they produce. These two neighborhoods are located in a province called
Iloilo and are situated on the coast of the Iloilo Strait. The majority of the people living in these
communities are living in what is considered extreme poverty [2] (making less than $117 USD a month).
With daily hazards to life such as health problems, economic shortcomings and relocation concerns this
community is in dire need of assistance.

In recent years the government has taken some action to remedy the situation. In 2001, the Philippines
government passed a solid waste act aimed to incentivize proper garbage disposal by establishing
environmentally friendly dumping grounds and using trucks to collect the garbage. However, this attempt
fell short for several reasons, mainly due to weak enforcement and poor education for the citizens. The
good news is that there is a desire to improve the situation and there is an existing structure in place. It
just needs to be improved and monitored appropriately.

The main objective of the project is to fix the waste management system by addressing the root cause of
the issue and correcting previous failures. Effort has already been put forward by the government and by
the Filipino people to address the issues; accordingly, a beneficial solution will ensure the existing system
works as intended. The main objective will revolve around 4 goals, each addressing a fundamental issues
in the communities. Firstly, the community needs to be properly educated to understand the benefits of
proper waste management so they are incentivized to participate in the waste collection process.
Secondly, the coverage of the existing waste collection system must be expanded in order for it to be
more accessible to the community residents. Thirdly, the system can be improved by coordinating with
existing waste management facilities to provide a monetary return from the garbage they deposit. Lastly,
existing waste management systems with external organizations that can utilize the waste and ultimately
produce some monetary gain to the community.

It is important to note that a comprehensive solution to the community’s waste management issue will not
consist of a single product or service that will reduce the amount of garbage produced. Similarly,
collecting the existing garbage will not address the root cause of the issue. The project focuses on the
systems in place and strategically optimizing and improving them to improve the lives of the Sto Niño
communities. The lack of education and motivation of the community residents to properly dispose of and
manage their waste is at the heart of the waste management problem.

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2.0 Background and Context
This sections provides a literature review on the problem, the service environment, and the stakeholders.

Poverty in the Barangays

The majority of the people in our target communities live in poverty. The Philippine Statistics Authority
poverty report of 2015 quotes the poverty line in the Philippines at USD $167 a month, while any families
sitting under $117 a month are considered to be in extreme poverty. In the target Barangays, the average
income for a single household can vary from $74 to $110 [3] [4]. This prevalence of poverty in these
communities causes two main features of the villages’ culture. Firstly, the garbage that is collected in the
villages by the Iloilo City government needs to be brought to the main road (Baluarte - Calumpang - Villa -
Oton Blvd.) [5][6]. This is actually the only major throughway in either of these communities and is
situated along the coastline on the south side of the villages (See Appendix A). From here, the refuse is
deposited in the Iloilo City Landfill, which is shared by all districts within the city and is located outside of
the target area.

However, due to the general economic situation of the Barangays, most residents cannot afford formal
properties along the main roads, and instead setup informal settlements closer to the Batiano River,
which forms the northern border of these communities, or near the Iloilo Strait, which forms the coastline
south of the main road (See Appendix A) [4]. As a result, families can be up to 450 m away from their
closest point of formal disposal, making it rather inconvenient to dispose of trash properly. The prevalence
and ease of setting up these settlements have also attracted other low-income citizens from surrounding
areas to move into the area, increasing the demands on an already insufficient waste management
system [4]. Secondly, low-income affects the people by way of the things they purchase. Most
consumable products used at home by the people are often bought in small single use soft plastic
sachets, as they tend to be more cost-effective for the families living here. These increase the amount of
non-recyclable waste that is produced within the area, as the sachets can not be turned into other plastic
products, will not be bought by local junk shops and use more material than buying materials in larger
quantities [4].

Behavioural Issues

The reality for many residents of Barangay Sto. Niño Sur and Barangay Sto. Niño Norte who live in the
seaside and riverside areas do not have the discipline to abide by the waste disposal rules and
regulations put forth by the government. Through no fault of their own, the benefits that come from a
established waste management system have not hit home for these people. Some main reasons for the
failure in adapting new practices are the distance from home to the road, as well as the ease of disposing
in illegal, yet convenient spots and an established group mentality. If few people adopt the new approach,
they will feel like it is irrelevant and go back to their old ways. Therein lies the problem; most people would
rather save themselves time and dispose garbage of incorrectly than take the effort to do it properly,
especially if everyone else is doing it. It will be our task to re-educate them into seeing the benefits the
additional effort required to dispose of waste properly brings to the community. Another behavioural
concern is proper incentives. Along with proper education, the incentives for proper waste management
need to be reaffirmed. Whether it be improvement in quality of life or monetary compensation, some form
of incentive needs to be presented. This will be a large scale undertaking and will require the leaders of
the Barangays to buy in and compel residents to follow in their footsteps.

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 Stakeholders

The stakeholders are discussed in detail in Section 4.0 however a brief introduction is provided below:
● Residents -​ They will be the primary benefactor and will be a top priority.
● Local Waste Collectors -​ The main driving force of the waste management system and present
a great opportunity for employment and could stimulate the communities to prosperity.
● Waste Management Facilities -​ ​being able to correctly process and manage the influx of
garbage coming will be vital to the success of this undertaking.
● Landfills -​ sustainable landfills will need to be created and maintained.
● Local Government -​ ​the government will be subsidizing some of the variable costs and will need
to play a role in educating and implementing the system to ensure a more successful integration.

3.0 Existing Solutions: State of the Art Review

This section provides a brief overview of existing state-of-the-art solutions to the problem, and the gap in the market that you are
proposing to fill in order to address the challenge.

Handling the waste management problem in the dense residential areas of Sto. Niño Norte and Sto. Niño
Sur is by no means an easy task. As highlighted by the technical brief provided by World Vision, three
initiatives aimed specifically at this neighbourhood were undertaken, but to no avail. However, these
projects and others across the Phillipines provide insight into what may and may not work for these two
Barangays.

Material Recovery Facility (MRF)

In 2001, the national Filipino government enacted the Ecological Solid Waste Management Act of 2000
which stated that every Barangay, or cluster of Barangays, required a material recovery facility [7]. These
facilities would provide residents with a location in their communities to deliver and drop off waste easily,
as well as reducing the amount of work done at the regional landfill site to segregate the waste.

Unfortunately, although the policy was put into effect almost 20 years ago, to this day neither target
village contains an operational MRF [4]. What seems to be the main issue holding this initiative back is
the lack of public support, as the case studies mentioned in the brief touch upon the apathy amongst the
residents to clean up their villages and be accountable for their own waste [4]. Considering this initiative is
supposed to be handled and operated by district or village politicians, and the Barangays currently lack
any sort of committee or team to improve the MRF situation, it is unlikely that the current populace (along
with their attitudes towards waste management) will take it upon themselves to do so. Moving forward, a
program that motivates the general population to clean up their communities may lead to renewed
success for this initiative.

Nets and Seawalls

These two initiatives were put into place to curb the amount of water (and the garbage it contains) that
flowed into the neighbourhood during high tides and floods [4]. The nets were intended to catch waste
flowing within the currents, filtering out garbage that would have entered the neighbourhood, while the
seawalls would be made of oyster shells, impeding the flow of sea or river water and reducing the flux of

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garbage [4]. Both projects have local support and may have promise, but our team feels they do not
tackle the problem.

Our team is focused on helping these Barangays improve their current methods of waste management
system and unfortunately, these two solutions do little to nothing to remove garbage from the community.
Instead, they may allow for residents to increase the practice of dumping refuse into their local bodies of
water, as the garbage would sit away from their streets and houses. For these initiatives to ever
contribute to an effective waste management system, they would need to be paired with a responsible
and effective method of removing the trash from the waterways as well.

Pag-asa sa Basura

This program in the Filipino capital city of Manila, within its Baseco district, motivated community
members to hand their recycling due to the fair compensation promised for recycled items [4].
Additionally, Proctor and Gamble, a major producer of the plastics Filipinos throw out, joined the project
due to the great PR opportunity (as they were under media scrutiny for their contributions to the waste
problem) [8]. With the combination of a major corporation in P&G, NGOs such as World Vision and The
Plastic Bank, and the participation of the community, the Baseco’s waste management system was
successfully revamped.

It is mentioned earlier in World Vision’s technical brief that one problem with current recycle incentive
programs in the area was the lack of return for a daily worker picking up garbage in their community. Most
plastics could be sold back to the local junk shops for only 64 US cents a kilo. On top of that, the single
use sachets of household consumables that are used rampantly in this part of the Philippines are not
even able to be sold back to local junk shops [4]. Increasing the recycling compensation, and introducing
vouchers for goods and services, as was done in Baseco, may prove to better community interest in
revamping the waste collection system of the subject Barangays. Additionally, incorporating a feasible
manner for the sachets to be fed through the incentive program will only strengthen interest. With the
support of teams like ours, World Vision, and potential corporate partners looking to make a similar move
as P&G, this model may be able to work quite effectively in Sto. Niño Norte and Sto. Niño Sur.

Other Filipino Projects

In both Rizal and Iloilo provinces, there have been methods introduced to turn the waste created by these
communities into something useful. In Rizal, landfills were being harnessed for their methane gases to
power electrical generation plants, while in Iloilo City plastics were being rerouted from landfills to
factories to produce armchairs [9][10]. Although these methods do not directly increase the amount of
waste being correctly handled by their districts waste management systems, the fact they allow these
regional governments to produce products and energy may lead to improvements in compensation for
residents recycled goods. Allowing the political bodies in the area a chance to sell or trade usable
commodities generated from their denizens’ trash may create a more lucrative return for the consumer
recycling their products, as the margin on compensation will shift. In turn, this will lead to increased
participation in the local waste management system, which is something that will greatly benefit Sto. Niño
Norte and Sto. Niño Sur. In fact, Iloilo City will soon be following in Rizal’s footsteps as it has signed a
reciprocity deal with neighbouring Leganes, who will be soon opening up a waste-to-energy plant
themselves. By allowing Leganes to dump their waste in the Iloilo landfill for the time being, the city will be
allowed to utilize the new facility when it becomes operational [11].

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4.0 Proposed Innovation
This section describes the proposed innovation, delivery, and the potential economic, social and environmental impact the
innovation will have on the target community.

The primary stakeholders in the waste collection system in the residents of the community themselves,
the waste collectors, the waste management facilities, landfills, and the local government. Figure 1 below
highlights the problematic interactions between the main stakeholders, excluding the local government,
who oversees the entire process. The proposed solution aims to improve the existing system by
strengthening the reverse supply chain of glass, plastics, organic products and papers in the Sto. Niño
Norte and Sto. Niño Sur. To do so, the relationships between the identified stakeholders and
effectiveness of each stakeholder will need to be improved as well. Specifically, the residents need
increased access to appropriate waste disposal sites, and additional incentives to actually use them. As
well, the collected waste needs to be handled and distributed appropriately to increase its value.

Figure 1: Ideal and Actual Waste Process Flow Diagram

The proposed solution is to implement ​waste processing kiosks​ throughout the two communities. The
kiosks will serve as waste disposal sites that are more appealing and accessible than the existing illegal
dumpsites and the rivers where residents currently dispose of their garbage. The kiosks handle waste
sorting and processing, as well as financial management, as shown in the figure 2 below. The purpose of
the kiosks is to increase the financial value of waste products and distribute them to organizations that
find value in them, either for reuse, recycling or repurposing. The residents will be paid for the waste that
they deposit at the kiosk, which will be processed and sold to organizations that value the various waste
products. The solution requires significant behavioural change on the part of the end user; the financial
incentives and increased accessibility aim to combat this issue. In addition, a door-to-door marketing
campaign will be required to educate residents of the new system and the benefits of using it.

Figure 2: Waste Processing Kiosk

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The kiosks will be dispersed throughout Sto. Niño Norte and Sto. Niño Sur, placed at convenient locations
where residents already travel frequently, as well as at existing illegal dumpsites. Residents will take their
waste to the waste processing kiosks where it will be separated into organic, plastic, glass and paper
waste. Residents will be given a financial payment for the waste they deposit at the kiosks. A financial
value will be attributed per unit waste to each of the types of waste collected and payment will be based
on the weight of each kind of waste provided. As such, preference will be given to residents who separate
their waste by themselves. For residents who do not sort their waste on their own, a fixed price will be
given per bag of waste, subject to certain requirements to prevent cheating of the system. A space will be
provided near the facility to allow residents to sort their waste. Where waste processing kiosks are
infeasible due to high density or land availability, ​mobile waste collection sites​ will be implemented to
transport waste to a nearby kiosk. The figure below shows the entire process of the proposed solution.
Once waste is sorted it will be processed and distributed accordingly. Waste from all the waste
processing kiosks will be transported to a​ ​centralized waste storage facility ​located in between Sto.
Niño Norte and Sto. Niño Sur.

Figure 3: Proposed Waste Process Flow

A fleet of vehicles will need to be contracted or procured to facilitate the transportation of waste from each
kiosk to the centralized facility. In dense areas where a waste processing kiosk may be infeasible or
accessible by truck, like the northern part of Sto. Niño Norte along the river, boats and trolleys can be
leveraged to access these sites. Waste will be collected from the kiosks frequently to ensure the kiosks
do not go over capacity. The centralized storage facility will facilitate distribution of processed waste to
relevant organizations. For example, processed plastics can be sold to the Plastic Bank, organic waste to
Leganes Energy Facility, and glass and paper to junk shops. The processed waste will be sold to relevant
organizations at a price such that the business is revenue neutral.

The project will be beneficial to the community from an economic, environmental and social standpoint.
Economically, the monetization of waste will provide community residents with additional income. As well,
staff will be required to manage and operate each waste processing kiosk, as well as the transportation of
waste to the storage and distribution facility and the operations of the facility itself. The staff will be hired
locally and provide employment for residents within the community. The project directly targets the bottom
of the pyramid as it focuses on increasing income and employment in an impoverished community. The
environmental impacts of the solution are clear; the use of waste processing kiosks will reduce the
amount of waste discarded into the environment. As well, waste that is collected will be properly disposed
of and recycled, further reducing the impacts on the environment. The long term environmental
sustainability of the community will be improved due to the improved waste management system and
reduced amount of waste that seeps into the environment. Socially, the existing cultural norms that
prevent community residents from looking after their community will be broken down. Given the
successful implementation of the project, properly disposing of waste will be the norm in the community.

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5.0 Business Model Canvas
This section provides a Business Model Canvas for the proposed solution along with a detailed business proposal.

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Key Partners - ​Partnership with suppliers and service providers is very important because it allows us
to optimally perform the core activities. An important type of partnership is buyer-supplier relationship with
kiosk suppliers, boat suppliers, and drivers. Having strong economic relationships such as strategic
alliances and mutual interests that will create reliable access to resources from suppliers. Partnership with
these companies should be long term because resources such as boats and kiosks require frequent
maintenance. In addition, developing a high level partnership and relationships with governments and
local leaders will help our program to promote proper waste disposal through their education system and
using their landfills. The partnership with companies that treat waste afterlife such as plastic banks,
leganes energy facility to burn waste and plastic shredder supplier completes our secondary function. Our
primary function when creating partnership is to have bonds that help families separate their waste from
their house to official landfills. A detailed description of the partnership terms with the key external
partners is as follows:

Government: ​potentially provide subsidies for the operations of the waste processing kiosks and
the overall operations of the program. The government can also assist the program through stricter
waste management policies mandate the use of the waste processing kiosks. At the same time,
the government may institute rules and regulations for waste processing that may affect the kiosk
operations.

Plastic Bank:​ a company that exchanges money for plastic waste, Plastic Bank may provide
above market rates for plastics to incentivize its collection to help promote plastic to be traded in
for items, services and money. The waste processing kiosks will make plastic collection more
accessible for residents; plastics collected will be sold to the Plastic Bank to be recycled.

Leganes Energy Facility (LEF): ​a facility that converts organic waste into energy, LEF will be the
primary purchaser of organic waste from the kiosks. A means of transporting biodegradable
composites to Leganes, a neighbouring municipality, will need to be established.

Junk Shops & Recycling startups: ​to generate revenue from the collected paper, metal and
glass collected from the household families, partnerships with junk shops will leveraged to sell
these waste products to them. Recycling startups who develop biodegradable bags, bottle shops,
photodegradable technology and other solutions to close the recycling loop will also be customers.

Local Leaders: ​to add intellectual resources on the community's ethical standards, highest levels
of expertise and local connections that will aid our process. To also receive direct feedback from
our customer on the system to improve and alter in order to better suit their needs.

Key Activities - ​The key activity for our proposed solution is to communication and accessibility to
strength Sto. Niño Norte and Sto. Niño Sur’s waste management system. One important aspect of the
waste management solution is to increase coverage in order to access all households in Sto. Niño Norte
and Sto. Niño Sur. Our goal is to create multiple kiosk administration to sort collected waste from dump
sites and delivery to facilities and landfills. Dump sites are created near rivers to lessen the walking
distance for families to throw out trash, while trucks serve the same purpose of collecting trash near
households. Families can exchange their waste for incentives, it creates less reasons for the family to
dump their trash into the river.

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Key Resources - ​The resources required to create a cleaner environment for Filipino communities is
have human resource (employees and volunteers), strong business partnership with suppliers and the
government, and strong financial management. Human resources include truck/boat drivers, kiosk
administrators, financial planner and analyser and labourers for recycling and sorting waste. Through
partnership with suppliers, acquiring physical resource including transportation boats, trolley, garbage
trucks is important to help extend waste management coverage. Intellectual resource from community
leaders and the government will help optimize trash collection channels and paths. This means we need
to study the geographical area and determine effective methods to reach every household either by land
or water. Lastly, another key resource is revenue from investors and partners (more details in Revenue
Stream section). Providing incentives back to families who spend time to properly dispose of their waste
is a key method to increase motivation in our solution.

Value Proposition - ​Sto. Niño Norte and Sto. Niño Sur families gain three values from our waste
management system: education, accessibility, employment and financial incentives. By working with the
government and community leaders, our goal is to implement lessons on why recycling and proper
disposal of trash is essential for keeping their community clean. These lessons include scientific studies
showing how human health and marine life is adversely affected by the accumulation of trash. The next
value the families are getting being more accessible to local dump sites by increasing more trucks and
even boats to collect waste. This will help them save time, energy and motivate them to dispose waste
properly. The last value for the families is the incentives that is given to families at dump sites (See Part
6.0 Financial Assessment for more information).

Customer Relationships ​- ​The relationship is community because knowledge on our improved

recycling system, increase in kiosk, increase in disposal sites and increase in transportation frequency is
shared to all households. The community platform produces a situation where all members are expected
to dispose trash properly. It should be looked at negatively if someone in this community is not following
our waste management system we implemented. The next relationship with customers is self-service
because families are to perform their routine of taking out the trash in their house without requiring our
assistance. The solution’s extensive waste management coverage provides the tools to help them
dispose trash by themself.

Customer Segments - ​Our waste management system is divided into two segments: sector and
geography. The municipal sector includes all household residences that live in the region while the
industrial sector are workers in the commercial industry. Household waste accounts for 74% of the total
waste generated and will therefore be the main point of focus [12]. Geographical segmentation is also
considered in order to group our customers based on mutual behaviour and tailor the business model to
match their habits.

Table 1: Customer Segmentation Breakdown

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Distribution Model & Channels

Market Entry Strategy

To bring the proposed innovation to the market, the team has agreed on a strategic entrance strategy that
relies on ​partnerships​ and ​on-ground program activation​. Establishing partnerships with the
government, local leaders and third parties is the first step to assure the viability of this business model.
The terms of the partnership agreements are as discussed earlier in this section. The second phase of
the entrance strategy is to launch an on ground activation program comprised of collection sites, waste
processing kiosks, and centralized facility for storing processed waste waste.

Delivery Channels & Points of Contact (POCs)

The first stage in the proposed business model requires customers

(disposing sector) to drop-off the waste at the designated waste
processing kiosk. To ensure that these sites are easily accessible, the
kiosks will be distributed throughout the community, at locations where
residents would typically travel. In Sto. Niño Norte, which is particularly
dense and has greater access to the river, kiosks will be distributed
along the river to disincentive using the river for waste disposal.

Trucks and/or trailers that connect to moving vehicles will be used in Sto.
Niño Sur to transport waste from the kiosks to the processing facility,
because the neighbourhood has well paved roads that are easy to
access and navigate. On the other hand, motor boats will be used in Sto.
Niño Norte since its housing is densely packed and people have access
to the river, where they often dump their trash. Appendix A provides a
google map aerial view of both neighborhoods.

Centralized processed waste storage facilities are the primary channel

for interacting with waste collectors and third parties such as the plastic
bank, junks shops, energy facilities, and recycling startups. These third
parties will buy processed waste from the facility, either to be picked up
at the facility or delivered directly to them. The facility will be the main
storage warehouse, and exists to consolidate all waste collected
throughout the community prior to distribution.

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6.0 Financial Assessment
This section provides a high-level financial assessment of how your proposed solution can be economically-viable by exploring the
cost structure and the revenue estimation for the proposed solution.

Performing financial projections and conducting estimates are imperative steps for the team to
undertake in order to be able to meticulously evaluate the possibility of success for the proposed solution
and to potentially identify any gaps at an early stage. Primarily, the sole reason behind conducting
financial projections is to determine whether the proposed business model can be economically viable or
not, and if not, then what are the impeding factors.

Revenue Estimation
The primary source of revenue streams for the
proposed design will be generated through the
commercialization of processed waste. The idea is
to separate the waste and process it as required
in order to sell it to third parties such as the plastic
bank, junks shops and energy generation facilities
that will be able to utilize the processed waste as
raw materials for their operations.

According to waste report published by the Senate

Economic office of the Philippines, an average
waste bag is primarily comprised of biodegradable
composites, which account for 52% of the mass.
Following that comes the recyclable material
accounting for 28% and residuals for 18%. Figure 4: Average Waste bag composition [12]

The recyclable waste is comprised of plastic packaging waste, glass, and paper. The residuals are non
degradable and often end up in a landfill. Finally the remaining 2% are hazardous materials as
demonstrated in figure 4​ ​above. These waste composition values can be used to provide a framework
for estimating how much revenue can be generated from the proposed business model that aims to
generate money by selling processed waste a raw material. Table 2​ ​found below provides an estimate
of the selling prices for the different materials that can be sold upon separating and processing the
waste. One assumption made was that recyclables are equally distributed across the different materials
that constitute it, therefore and average of the selling price for each material was taken.

Waste Stream Selling Price

Compost $0.15​ per kg of compost [13]

Plastic: $0.2 per kg of plastic waste [14]

Paper: $0.1 per kg paper waste [15]
Glass: $0.04 per kg of glass waste [16]
Recyclable
= ​$0.113​ per kg of recyclables

Table 2: Processed Waste Selling Prices (USD)

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 Figure 5: Daily Revenue Estimation Diagram (USD)

According to the report provided by World Vision, Sto. Niño Norte and Sto. Niño Sur is home for 14,172
individuals that generate somewhere between 0.2 kg to 1 kg waste per capita on daily basis, depending
on whether they live in urban or rural areas. That being said, an average of 0.5 kg of daily waste per
capita can be used as a fair overall approximation. Figure 5​ ​demonstrates that on average, Sto. Niño
Norte and Sto. Niño Sur generate 7086 kg of waste per day. Using the selling prices found in table 2,
the daily revenue was calculated to be $777( USD). This number may seem fairly low, however it only
accounts for the new generated waste on daily basis and does not take into account the potential of
utilizing the already existing waste in ocean and on the land.

Cost Structure

Table 3: Costs approximation (USD)

Table 3 found above provides an approximation of the fixed and variable costs required to operate the
proposed business model. The initial fixed cost required to implement this business model up to the
closest point of operation is $24,680, while the cost required to operate this business model on daily basis
is $460 (variable). However that does not account for the amount of money paid out to customers who
drop off their waste at the designated waste collection sites. This amount is varies depending on how
much revenues are made from selling the processed waste to interested parties and external entities.

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 6.3 Economic Viability

In order to conclude whether or not this business is economically viable, some assumptions were made
while generating this proposed business model. These assumptions would certainly affect the overall
viability of the proposed solution. The assumptions are as follows:

● World Vision will provide $25,000 ​to the team in order to aid the implementation of this solution.
The team believes that this amount of money will cover the estimated fixed costs (initiation cost)
and therefore would bring the fixed cost balance down to almost $0.
● The team aims to ​partner with the government of the Philippines and local aid providers​ in order
to subsidize the variable expense of $460 on daily basis and provide space (land) for installing
the waste processing kiosks and collection sites. Therefore, the variable daily expense will be
funded by the government and external subsidies.

Assuming this happens, the business model would be able to generate a net profit of ​$777 USD ​on daily
basis. The profits generated will be used to price the waste paid to the community members at the kiosks.
Assuming all ​14,172 people ​who live in Sto. Niño Norte and Sto. Niño Sur use the kiosks and disposes
equal amounts of waste, ​each person will receive $0.055​ for each day he/she drops of waste at the
designated waste collection sites. In that case, an ​average family of five would receive $0.25​ ​every
day​ they drop their waste at right spot.

Although these numbers may not be a strong enough incentive that would certainly push the inhabitants
to properly dispose their trash, the team will look into other aiding methods that can change the people’s
behaviour and motivate them. This is discussed in further details in section 7.0.

7.0 Next Steps

Our team has reached a point in this project where we have become fully aware of the people, cultures,
environment, and the problems that are associated with this scenario. Using this information we have
formulated a design and business model we hope to grow in the coming weeks. However, to achieve this
work continues to be required on both the solution and financial side to ensure this project will succeed as
best as possible.

Design

Our team has established the framework of solution aimed to revamp and transform the current waste
management system. Our work has generated a process composed of smaller components, each of
which serves a specific purpose. However, at this point we have only covered the “what and why” of each
component’s function, and it is time for our team to move onto the “how”; the logistics. First off, we know
that injection of waste into the formal waste collection system has been difficult for isolated residents off
the main road, and have proposed the use of small land vehicles and boats as waste collection units to
make things easier for residents moving forward. In order to ensure these are being implemented as
appropriately as possible, more detailed questions need to be answered. These include queries such as;
How often is the frequency of pick-ups by these units? How many will the community require? Will the
municipal or government officials be responsible for this system? Will the system be an avenue of
employment, or a volunteering initiative? What is the best choice of trolley/cart/motorized land vehicle,
and best choice of motorboat? Will significant modifications have to be done on the vehicles to make
them fit to carry loads of trash? Are there already current pieces of infrastructure available in the
community?

Topics like these will also need to be answered regarding our proposed collection buildings (Waste
Processing Kiosks and Centralized Processed Waste Storage). Already, as we look forward, we know the

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Material Recovery Facility Program in the Philippines constitutes that MRF’s meet certain considerations
[4]. As the MRF performs similar functions to our proposed buildings, we feel it justified to follow these
considerations for our proposed storage and processing waste facilities. These considerations include
that processing of materials within the facilities must be able to be done safely, while storing and receiving
material efficiently and ecologically. Additionally, the buildings (especially the CPWS) will need to be
designed in a manner that allows for larger vehicles to access materials that may be shipped in large,
bulked orders. Both buildings will also need to be designed to easily receive materials from the smaller
means of transport we hope to introduce to the Barangays will help serve the populace better. The interior
will also need to be put into consideration as we work to balance floorspace between storage, processing,
receiving, and other functions. We also want to start studying the Barangays in greater detail in order to
choose usable and convenient plots of land to install the kiosks and centralized facilities. The creation of
building features to ensure these considerations are addressed will help guide our design process in the
coming weeks.

Business Model

We believe our current system truly incorporates the Challenge’s title goal of finding value in waste.
Ideally, by centralizing the waste collected in the area, different avenues that allow waste to be converted
into revenues for the community will be easier to access all at the same time. However, we want to
ensure as things mature on the design side of our solution, that we continuously reflect on what future
design choices will mean for returns we hope to generate for the community. This means that any
modifications or additions to the proposed strategy will require the execution of a proper financial
assessment of the change. We highlight this due to the importance of the revenue sharing feature of the
design, as it will serve to motivate the community to participate in our system.

Additionally, we will begin to take a closer look on the other operations that may feel threatened or cut-out
if our design takes hold. It is mentioned in our proposed design that Plastic Bank, the Leganes Energy
Facility and local junk shops are all partners we hope to incorporate into our system. However, we also
want to ensure that these groups do not become unnecessary competitors to our design. This may come
about if our system causes them to lose potential revenues, and may instead choose to bypass our waste
management process or looking for business with other communities entirely. By understanding our
partners operations and their expectations, we will be able to accurately and effectively build our
economical model to meet their financial requirements as best as possible.

Finally, we need to start planning for the transient stage of implementation in the case our project reaches
the target communities. This stage will require most other tasks to be completed, but it is still key to the
successful integration of our solution. At this stage we begin to look at the actual work and activities that
need to be performed to get our solution on the ground in Iloilo. However, at this point in the project, we
still require more segments of our design and business model to be finalized to make concrete plans for
the future.

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8.0 References

[1] Jambeck, J.R., ; Geyer, R., ; Wilcox, C., ; Siegler, T.R., ; Perryman, M., ; Andrady, A., ; Narayan, R., ;
Law, K.L.. Journal Article. [Online]. Available:http://science.sciencemag.org/content/347/6223/768/tab-pdf.

[2] "Waste - Social Innovation Challenge", Social Innovation Challenge, 2019. [Online]. Available:
https://challenge.worldvision.ca/en/challenge/waste/. [Accessed: 02- Feb- 2019].

[3] Republic of the Philippines (2019). ​Poverty incidence among Filipinos registered at 21.6% in 2015 -
PSA.​ [Online] Psa.gov.ph. Available at: https://psa.gov.ph/poverty-press-releases/nid/63819 [Accessed
27 Feb. 2019].

[4] "Waste - Social Innovation Challenge", Social Innovation Challenge, 2019. [Online]. Available:
https://challenge.worldvision.ca/en/challenge/waste/. [Accessed: 02- Feb- 2019].

[5] "Waste - Social Innovation Challenge", Social Innovation Challenge, 2019. [Online]. Available:
https://challenge.worldvision.ca/en/challenge/waste/. [Accessed: 02- Feb- 2019].

[6] General Services Office | Iloilo City, ​Iloilocity.gov.ph​, 2019. [Online]. Available:
https://iloilocity.gov.ph/main/general-services-office/. [Accessed: 26 Feb- 2019].

[7] National Solid Waste Management Commission, "Establishment of Materials Recovery Facility
(MRF)", ​Nswmc.emb.gov.ph​, 2019. [Online]. Available: http://nswmc.emb.gov.ph/?page_id=936.
[Accessed: 23- Feb- 2019].

[8] C. Joyce, "Movement To Find Alternative To Plastic Packaging Grows In Philippines", 2019. [Online].
Available:
https://www.npr.org/2019/01/16/685980872/movement-to-find-alternative-to-plastic-packaging-grows-in-p
hilippines. [Accessed: 27- Feb- 2019].

[9] ABS-CBN News, "Meralco to source energy from Rizal methane plant", ​ABS-CBN News​, 2009.
[Online]. Available:
https://news.abs-cbn.com/business/04/16/09/meralco-source-energy-rizal-methane-plant. [Accessed: 27-
Feb- 2019].

[10] Philstar.com, "Recycling factories make armchairs from plastic waste", ​philstar.com​, 2018. [Online].
Available:
https://www.philstar.com/business/science-and-environment/2018/06/21/1826387/recycling-factories-mak
e-armchairs-plastic-waste. [Accessed: 27- Feb- 2019].

[11] L. Conserva, "Iloilo town wants to dump garbage in Calajunan", ​The Daily Guardian​, 2019. [Online].
Available: https://thedailyguardian.net/local-news/iloilo-town-wants-to-dump-garbage-in-calajunan/.
[Accessed: 27- Feb- 2019].

15
[12] "Philippine Solid Wastes At A Glance", 2019. [Online]. Available:
https://www.senate.gov.ph/publications/SEPO/AAG_Philippine%20Solid%20Wastes_Nov2017.pdf.
[Accessed: 23- Feb- 2019].
[13] "City outlines compost facility costs", ​GuelphMercury.com​, 2019. [Online]. Available:
https://www.guelphmercury.com/news-story/5856117-city-outlines-compost-facility-costs/. [Accessed: 23-
Feb- 2019].

[14] M. Hestin, T. Faninger and L. Milios, Increased EU Plastics Recycling Targets: Environmental,
Economic and Social Impact Assessment, 1st ed. United Kingdom: Deloitte, 2019, pp. 35-40.

[15]"Baled Waste Paper", ​Canadian Recycle Exchange​, 2019. [Online]. Available:

https://www.recyclexchange.com/a/view/1206.html. [Accessed: 21- Feb- 2019].

[16] B. writer, "Is recycling glass worth the cost?", ​The Killeen Daily Herald​, 2019. [Online]. Available:
http://kdhnews.com/news/is-recycling-glass-worth-the-cost/article_8e2dd0e6-d956-11e2-ab95-0019bb30f
31a.html. [Accessed: 22- Feb- 2019].

16
9.0 Appendix

Appendix A​ - Google Maps view of ​Sto. Niño Norte and Sto. Niño Sur

Figure A1: Google Maps view of​ Sto. Niño Sur

Figure A2: Google Maps view of​ Sto. Niño Norte

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Appendix B​ - Google Maps view of ​Sto. Niño Norte and Sto. Niño Sur

Figure B1: Map on the left showers the area of residence less than 50m from the shore area where waste is
accumulated. Map on the right shows area of residence over 50m away from the shore.

18