cfc annual report 2009-10

empowering mothers to break the cycle of

poverty

ANNUAL REPORT

2009/10

of 18 EMPOWERING COMMUNITIES | CARPETSFORCOMMUNITIES.ORG | 2009/10 �

CONTENTS

From the Chief Executive Officer... 3

Major accomplishments of CfC in 2009-2010 3

About Us: Strategic Direction of the Program 4

Australian Operations 7

Our Structure, Volunteers and Members 7

AIESEC Partnership 8

Sales and Marketing 9

External Relations and Media 10

Conference Output 10

Cambodian Operations 11

HR Structure 11

Income generation project 12

Other community support 14

Statistical data 16

Financial Information 17

� EMPOWERING COMMUNITIES | CARPETSFORCOMMUNITIES.ORG | 2009/10 of 18

The young guy who met some kids while on a visa

run never imagined it would turn into this. He

never imagined having groups of volunteers all

around Australia selling products from the little

town where these kids lived.

I hoped but never really believed that big retailers

would be selling the products in their stores. And

it’s all because of the countless hours put in by

volunteers all around Australia (and overseas). I’ve

been humbled by the dedication of people and

their contributions to the project.

By almost any measure this has been an incredibly

successful year for Empowering Communities

Incorporated (EC) and Carpets for communities

(CfC), our founding project.

For EC this July marks our first full year as a

registered Organisation and for CfC it has been a

year of incredible growth in sales enabling us to

more than double the number of families in the

program.

Volunteers are the life blood of CfC and we’ve seen

new groups start up in many areas of the country

bringing in lots of new faces and energy into the

CfC family. Through our partnership with AIESEC

we’ve seen a lot of other new faces bringing over 7

AIESEC Interns in this financial year, not to mention

the two Aussies we sent to Cambodia previously.

2009-10 also saw our first full time people in

Australia with Frank Aquaah as CEO and Kerstine

Alba as National Volunteer Manager. This year has

been about growth and building our capacity for

future growth so that we can reach as many

children and families as possible.

David Bacon

Interim CEO and Founding Director

Fro

m t

he F

ou

nd

er…

Key accomplishments in 2009/10

• We expanded our program from 20 to

45 families

• We ran a fundraising movie night

initiative – ‘Rug Trip’ in three states

• We had our first full time CEO apart

from our Founder

• Our Stock Crisis appeal was extremely

successful - we raised $7000 in 7 days

• We hired our first National Volunteer

Manager

• We employed a social worker to work

in Poipet

• We became officially registered as a

charity in Cambodia

• We had our first major retail

relationship with Discount City Carpets

• Dave was invited to AIESEC

International Conference as special

guest.


For further reading…

http://www.cosecam.org/publications/goods&girls_trade_border_research_eng.pdf

http://www.cosecam.org/publications/newsletter02.pdf

http://www.ucw-project.org/Pages/bib_details.aspx?id=11552&Pag=0&Country=36

Our organisation is Empowering Communities Inc, an Incorporated Association in South Australia, Australia. We trade as ‘Carpets for Communities’, our flagship project.

Our Purpose

The founding purpose for Empowering Communities is to create the ultimate

social enterprise model that empowers children, families and communities to

lift themselves out of poverty and create true freedom for their futures.

Our Mission

Our core work is to offer immediate intervention to give at risk children an

education through empowering their mothers to produce eco-fairtrade

products, which sell globally.

Big Hairy Audacious Goal (BHAG)

By 2012 we will return 2500 children at risk of exploitation to school by

empowering 500 families in Cambodia and the world.

Why do we work in POIPET?

Poipet is a Cambodian town on the Cambodia/Thailand border, in Ou Chrov district,

Banteay Meanchey Province. It is a key crossing point between the two countries, and

also extremely popular as a gambling destination as gambling is popular, but illegal in

Thailand. There is a strip of casinos and hotels between the Cambodian and Thai

passport control counters, enabling Thais to gamble in Cambodia without needing to

go through Cambodian immigration.

On the Thai side of the border there is a large market (long klua) where thousands of

Khmers (Cambodians) go each day to sell goods and for market related work (such as

‘cart pushing’ to transport goods across the border). Many of the families that our

project targets have children who work or beg at the border and or long klua market

and who are at risk not only of missing out on an education but also of human

trafficking, prostitution and other forms of child exploitation. Poipet has some of the

highest levels of poverty in the country.

Ab

ou

t U

s


Brief History of Carpets for Communities

Founded in 2005 as a joint effort between some Australian Volunteers, a Thai Factory, A

Thai Foundation and a local Cambodian Foundation, CfC grew slowly for the first 2

years making wool and silk carpets for the Thai carpet factory eventually reaching 18

women and 58 children. In 2007 we lost funding for the project manager and were no

longer able to produce the technically difficult wool and silk rugs.

We started focusing on a product that we had developed that we could market

ourselves (the cotton off cuts rugs), cutting out the middleman and making it more fair-

trade, generating more income for the women for the same amount of work done.

While the transition meant a reduction in productivity and therefore a reduction in the

amount that the women could earn this also led to the start of a period of strong

growth for the organisation from 2008-2010.

In 2008 we registered as an independent organisation in Australia and later in

Cambodia. This year we also started doing volunteer run market stalls in Adelaide and

in Sydney and in 2009 expanded around the country until we had volunteer groups

running market stalls in Adelaide, Sydney, Melbourne, Alice Springs, Brisbane and Perth

which allowed us to expand the number of families at the end of 2009 to 40 families

and 180 children.

Program Philosophy and Strategic Direction

CfC’s vision is being implemented according to a long term, 4 phase implementation

plan outlined below and so far, despite setbacks in finding managers for the project

and having to change the product and target market, we have progressed through

Phase I (Set up), Phase II (Proof of concept) and are now into Phase III (Expansion).

Initially we had hoped to use the profits from Phase II in the expansion for Phase III.

However, after extensive financial modelling and market research, including feedback

from large Australian rug wholesalers and many fair trade retailers, we concluded that

to keep the prices attractive to the market (and hence keep the expansion financially

viable) it would be necessary to secure external funding for Phase III.

The expansion plans for the CfC project rest entirely on the ability to sell all the carpets

that are produced. The market research that we have done in Australia alone and our

experience in selling the carpets over the past year supports this. Moreover, we have

been in discussions with rug importers about taking our rugs as an ethical,

environmentally friendly line and they have agreed to do so if we can scale production

up to commercial levels.


Our 4 Phase Implementation Plan

Phase 1 Set up (2 years, approx 2005-2007)

• Secure set up funding

• Form partnerships

• Bring in families

• Start production

Phase 2 Proof of concept (1.5 years, approx. 2007-2008)

• Work with a small number of families (10-20)

• Prove the economic and gender empowerment benefits to families and

individuals

• Prove the elimination of child labour and trafficking in target families

• Prove the product in the marketplace

• Economies of scale – find potential buyers for large quantities of product

• (Note: No funding required. Proof of concept means that it funds itself on sales

profits only)

•

Phase 3 Expansion (3.5 years, approx 2008 - present)

• Get funding for expansion

• Secure sales contracts for large quantities of product

• Bring in more families (year 1 - 100)

• Refine production model to produce at commercial levels

• Use profits for increasing development outcomes for participants

• Increase producers participation in the running and decision making of the

project

Phase 4 Diversification and replication (4 years, in the future)

• Get funding for replication

• R&D other products, means of income generation and opportunities in different

locations

• Transition volunteer families into different streams of income generation (to

trial)

• Put together replication team to replicate model in different contexts

• Replicate model in other locations and countries

After over 5 years of developing this project we are we and truly into phase III of

implementation. This was to be the really exciting part; where we get to take the idea that we

have spent so much time and energy proving over the last five years, and realise it on a scale

that will have a real impact across the community. However, we have been meeting more

challenges than we expected in phase three and it looks like there are more ahead before we

get a clear run at expansion.


Our Structure

For the 2009-2010 year, the Australian National Management Structure was as follows:

In 2009-2010 we formalised the Regional Management Structure of our

organisation in each state. This was as follows:

Volunteers and Members

Volunteers are the lifeblood of CfC and have been entirely responsible for it's success selling rugs in Australia. Every person that has given time for CfC has contributed towards the improvement of the lives of the families we work with in Poipet. The importance of this is reflected in the fact that we brought on a full time volunteer coordinator this year as the second full time role (after the CEO).

Volunteers also see the value in the work we are doing, which is clear by the

growth in our registered membership base from approximately 20 to

approximately 80 at the end of 2009-2010.

Our volunteer surveys during this period indicated that 100% of our volunteers

would definitely recommend volunteering with CfC to their friends and family.

Board of Directors

Lucy Chan, Kevin Chan, Melissa Willoughby, Richard Khoo, David Bacon

Volunteer Coordinator / HR

Kerstine Alba

Australian Volunteer Base

Regional Chapter President

Volunteer Coordinator

CEO

Frank Acquaah (Sep 09 – Aug 10) David Bacon (interim, Aug 10 – Oct 10)

Retail Manager Market Stall Manager

Casual market stall and events volunteers

Au

stra

lian

Op

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Main benefits volunteers recognize in volunteering with CfC are:

“Learning about yourself and others”, “growth in networks and skills”, “making a difference to

people in countries which really need it”;

“An exciting and uniting environment where people can find themselves as an important part

of a positive impact”;

“The feeling of community” - our volunteers get along really well and volunteering at a

market is likened to having a great chat with great people whilst making a difference to the

less fortunate;

“Increase in networking skills”;

“A legit organisation that works hard and is run by volunteers, that have fun together and are

committed and passionate about the organisation”;

We also found that volunteers spend between three to ten hours per week volunteering for

CfC on average.

AIESEC Partnership

The first internship was arranged in the last financial year and realised in September 2009. David chaired the AIESEC National Conference in Melbourne in July 2009 and proposed a partnership to AIESEC that would bring in a lot of extra capacity for CfC.

The interns that have come through this partnership

have been Frank Acquaah (Ghana) as CEO, Kerstine Alba

(Philippines) as National Volunteer Coordinator),

Liudmila Volcovici (Moldova), Helena Montenagro

(Croatia), and Beata Majewska as Queensland expansion

officers, Priscilla da Silva (Brazil) as Victoria Expansion

Officer and Laurens Koppelaar (Netherlands) as New

South Wales Fundraising and Sponsorship coordinator.

At the close of the financial year two more were in the pipeline with the CEO application process closing soon after that and one more intern already selected for Sydney. The fees we pay to AIESEC and stipends that we pay to the interns are our largest weekly costs in Australia and as such we need to analyse the costs and benefits of the program as well as the effectiveness of the type of roles and people we are bringing over. Also the partnership was not as successful for AIESEC as it was hoped it would be. The experience and benefits for CfC have been positive with contributions to the success of the organisation, but there is also a lot of room for improvement and we will be reviewing the best way for us to make use of AIESEC’s services.


Sales and Marketing

Sales and Marketing in 2009-2010 grew in leaps and bounds, as we expanded to more states

and more markets. This is illustrated through our figures to date.

Overall, in calendar year 2009 we had sales of $55,926 (AUD).

As at June 2010 we have had sales of $54,729 (AUD). Continuing at this trajectory means in

calendar year 2010 we should more than double the sales of calendar year 2009.

As part of this large increase in sales, in April 2010 we welcomed an order from Discount City

Carpets in Adelaide for 84 carpets (each unit 1.2m x 1.7m). This order amounted to

approximately $12,000 dollars, and became CfC’s first ever large retail partnership.

Sales averaged $7,920 per month for the period of 2009-2010, with some great months in

December 2009 ($12,928), March 2010 ($11,996) and May 2010 ($14,278).

Our most successful sales events included:

Name Date State Amount

AIESEC Movie Night Fundraiser

16 September 2009 South Australia $4,687

Valley Market Stall 28 November 2009 New South Wales $1,450

Perth Cultural Market - Market Stall

6 December 2009 Western Australia $1,650

Paddington Market Stall 12 December 2009 New South Wales $1,475

Fair Trade Market Stall 13 December 2009 Victoria $1,700

Kalamunda Market Stall 2 January 2010 Western Australia $1,370

WOMAD - Market Stall 8 March 2010 South Australia $3,492

Fairbridge Festival - Market Stall

9 April 2010 Western Australia $1,250

Emergency Fundraiser for cash flow

30 April 2010 Australia Wide $7,000

Manly Fair Trade Market Stall

8 May 2010 New South Wales $1,495

We have averaged 4.7 market stalls per week across the country, with the spread being as

follows:

Unfortunately a comparison to last year is not currently available, however the 2010-2011

annual report will be able to provide this comparison.


External Relations and Media

The resources were not available in this financial year to really push through this area;

however the hope is that having a full time ER manager in calendar year 2011 will be able to

push CfC further into the media and community spotlight.

Conference Output

Carpets for Communities hold conferences approximately every six months. The aims of these

conferences vary with each one, but on the whole they include aims such as:

• Conducting official association business at Annual General Meetings;

• Bringing volunteers around the country together to

o Conduct planning

o Create and drive strategies

o Provide a connection point

• Providing networking and learning opportunities for our members

These were the conferences held in 2009-2010:

RugCon – January 2010

RugCon in January 2010 was held at Glennbarr in South Australia. This

conference had 25 delegates, and ran from 29 January to 1 February 2010.

The major outcomes of this conference were:

• Decision on goals to reach our big hairy audacious goal (BHAG) by 2012

• Recruitment of potential volunteers Australia-wide

• Examination of what work Empowering Communities Inc might become

involved with

• Discussions on future development focus of CfC and what that might be

• Sharing of good case practices at market stalls

RugFest – June 2010

RugFest in June 2010 was held at Mariner Shores in Queensland. This

conference had 21 delegates, and ran from 18 to 21 June 2010. This was our

first conference operating under the concepts of Open Space Technology.

The major outcomes of this conference were:

• Current reality of each region

• Corporate grants and sponsorships would be a strategy that CfC pursues

• Joint understanding on child labour in Cambodia

• Product development would be a strategy that CfC pursues

• The organisational structure that CfC will take moving forward


Cambodian Structure

Our Cambodian team manages the critical role or managing the production process

whilst engaging and working with our participants.

For the 2009-2010 year, the Cambodian National Management Structure was as

follows:

The CEO was based in Australia, whilst the Country Manager was based in Siem Reap,

and the rest of the Cambodian staff based in Poipet.

Over the last year, the Cambodian team have has a strong focus on production and

quality control for our carpets. Systems have dramatically improved to support the

Cambodian team in both these aspects.

In the future, as the basis of our social enterprise strengthens (income generation), a

greater focus on quality of development outcomes will ensure our participants are

getting the best we can provide for their future and the future of their children.

Founding Director / Interim CEO

David Bacon

Poipet Office Manager

Naren Chhuut

Country Director

Mongheng Seng

Field Worker

Seng

Field Worker

Emda

Field Worker

Vanny

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Income Generation Project

The income generation side of Carpets for Communities has been able to support 40

families, with an average income of $63.78 per month.

During 2009-2010 we expanded to 25 new families, more than doubling the number

of families we were supporting at the end of the 2008-2009 financial year.

This was a staggered approach, conducted in waves:

Month Increase

in families

Total families

supported

Total number of

children back in

school

July 2009 N/A 20 families 63 children

August 2009 5 25 families 83 children

December 2009 12 37 families 131 children

January 2010 8 45 families 168 children

*The figure of $63.78 for monthly family income is equal to: (total paid to families for financial year 2009-2010)/12 months, then divided by the number of families (40) as at financial year end.

This means that the increase in the number of families (from 18 to 40) by the financial

year end has provided a figure that is an average for a period for which it is extremely

difficult to take an average for.

Here is a summary of the average monthly income per family for the entire financial

year:

Month Number of

families

Ave monthly

income per family

July 20 $58.31

August 25 $33.22*

September 25 $116.18

October 25 $57.57^

November 25 $56.32^

December 37 $42.42^

January 45 $53.24

February 45 $42.67

March 45 $110.54

April 45 $83.88

May 45 $105.60

June 45 $77.29

*Month of transition which means average monthly income was likely slightly higher than this ^Flooding and many public holidays during these months prevent the women from making as many carpets – they often visit families in other villages and spend time celebrating


The income generation side of Carpets for Communities makes a difference to all of

our families. Many of them come to CfC with similar stories – here is just one of those

stories.

Koul Pow joined the project in 2009. She has seven children—two under the age of six and five between six and 15. Before entering the project, some of Koul Pow’s children were not enrolled at all in school, and the rest, while enrolled, did not attend regularly because they had to beg or work as cart-pushers to support the family. Since their mother joined CfC, all of the children have the chance to study full-time at the local school. Koul Pow earned $58 a month before 2009. Now she earns $115 on average each month making carpets. Even so, she must purchase commodities on credit at times, because she also supports her elderly mother. Her son, who works in Thailand, also sends the family money and they manage, at present, do not have any outstanding loans. Koul Pow’s life has changed for the better since joining CfC. She feels that the family can eat enough and have better health, her children have the chance to study every day, and her relationship with her husband has improved.


Other Community Support In the 2009-2010 financial year, CfC also provided the following additional support to our

families:

• School uniforms for children returning to school;

• Debt relief;

• Small loans for domestic needs; eg health costs, a well etc

In 2009-2010 our community support and development activities have operated at a minimal

level. This is largely due to lack of funding and lack of resource on the ground in Cambodia.

We have regular quarterly meetings with the women, to enable and empower them to have

input into the operation of Carpets for Communities, and to assist us in identifying the most

important issues that they are facing on a day to day basis. Thus far, health care is one of the

most significant concerns.

We hope that, in 2010-2011, we will have more resources (both in terms of labour and

financial) to contribute to undertaking good community development work in these areas of

importance to our women. We particularly want to assist in ensuring they have access to high

quality, low cost health care for themselves and their families.


Statistical Data – KPI’s

Development KPI’s • In 2009/10, 100 more target children were added to the program for a total of 184 children

• 73.9% were attending school regularly

• Average family income was USD$63.78*

• 29.9% of our children are still working for money *Refer to Income Generation for more information

Production KPI’s • Our current stockpile of carpets is 380 m2 in Cambodia and 350 m2 in Australia

• We have 200kg of raw cotton in our raw materials stockpile

Sales KPI’s • Our average monthly sales (AMS) were AUD$7920

• We have 3.5 months of rug stocks (based on our stockpile / average monthly sales rate)

• AUD$363 is made on average at each sales event (eg; a market stall)

HR KPI’s • We have 121 registered volunteers

• 30-40% of registered volunteers are actively involved in activities.

100 more target

children were added

to the program for

a total of 184 children.

“

”

Perf

orm

an

ce S

um

mary


Revenue Expenditure

Donations 2,240 Bank Service Charges 198 Events Event Expenses RugCon 2010 2,494 ‘What About Me?’ 146 RugFest 2010 140 RugCon 2010 1,414 Fundraising Brisbane Film Night 100 Crisis Appeal 7,306 Freight and Delivery School Supplies 325 Interstate 2,865 Other 7,505 Cambodia – Aust. 15,436 Grants 1,058 Human Resources Market Stall Sales Volunteer Expenses 1,250 Stalls – NSW 35,122 Wages 11,580 Stalls – NT 3,045 Insurance 3,344 Stalls – QLD 2,050 Marketing and Sales 964 Stalls – SA 18,189 Memberships 82 Stalls – VIC 6,152 Other / Sundry 434 Stalls – WA 11,071 Cambodia Production 68,292 Retail Sales 15,675 Shirt Printing 1,380 Memberships 300 Other Product Purchases 500 Other Carpet Sales Other – NSW 1,514 Other – QLD 600 Other – SA 2,340 Other - WA 45 Other Income 4,710 T-Shirt Sales 640

TOTAL INCOME $122,524 TOTAL EXPENDITURE $112,734

NET SURPLUS $9,789

Assets Liabilities Cash at Bank 30,613 Loans 11,000 Accounts Receivable 450 Market Stall Equipment 341 TOTAL ASSETS $31,404 TOTAL LIABILITIES $11,000 NET EQUITY $20,404

Fin

an

cial Su

mm

ary


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