Profitability and Sustainability of Vermi Composting Business toward Social Entrepreneurship in Negros Oriental, Philippines

This study aims to determine the profitability and sustainability of vermicomposting business towards social entrepreneurship. Vermicomposting businesses which gained profit and sustained for at least five years were covered in the study. Personal interview and observations were undertaken with net profit margin, return on assets and investment, mean, weighted mean, fixed asset turnover ratio, ordinary least square, and correlation were utilized. Findings revealed that vermicomposting businesses were dominated by family enterprises and generated employment. The average net profit of sampled businesses was ₱921,784, average net profit margin of 74.59 percent; average return on assets of 179.06 percent; average return on investment of 83.00 percent. This higher profitability was attributed by satisfaction in growth both in business and personal income; increased customers; assessed customers’ satisfaction; initiated changes to overcome competition; enhanced employees’ competencies thru trainings; and kept organization’s best people. Said businesses had average fixed asset turnover ratio of 461.19 percent and projected to increase sales from ₱1,951,516 to ₱2,253,686 by 2024. This higher sustainability was due to improved employees’ standard of living; reduced pollution; absence of complaints regarding the project; and positive feedback regarding soil fertility. Type of customers had correlation of 0.984 with profitability. and 0.973 with sustainability while profitability had correlation of .800 with sustainability. The study concludes that application of frictional, innovations, risk and uncertainty bearing, and managerial efficiency theory of profits result to higher profitability whereas, higher sustainability is attributed by practice of social entrepreneurship with emphasis on economic, social and environmental contributions (Sustainability Theory).

Keywords – Profitability, social entrepreneurship, sustainability, vermicomposting business