Status of Agri-Tourism Business in Central Luzon, Philippines: Basis For Development Plan

Journal of Business on Hospitality and Tourism ISSN 2527-9092
Vol 06 No 02, 2020: 40-60

https://dx.doi.org/10.22334/jbhost.v6i2
Submitted: 29th August 2020

Accepted: 12th November 2020
STATUS OF AGRI-TOURISM BUSINESS IN

CENTRAL LUZON, PHILIPPINES: BASIS FOR
DEVELOPMENT PLAN
Imee De Guzman Esguerra

Bulacan Agricultural State College, Philippines
[email protected]
ABSTRACT
This study's main objective is to describe farmers' profile that venture into agri-tourism
business, analyze the status of their business operation, determine the best practices and
problems encountered by agri-tourism businesses in Central Luzon, which served as basis
in crafting a development plan. The descriptive research method using a purposive
sampling technique was employed in selecting the target respondents who were surveyed
and interviewed using two separate sets of modified survey questionnaires. Agritourism
businesses were accessible, family-run farms, affiliated with tourism and agriculture-
related organizations, and compliant with required facilities and safety measures. Visitors
were from all walks of life and came from within and outside the country. Classes,
seminars, workshop, and tours were their top service offerings. Trust and confidence,
referral system, hands-on operation, and strict financial monitoring were the identified
best practices. At the same time, labour shortage, being still a niche market, price
fluctuation, seasonality of farm products and services, insufficient staff skills, and
significant capital requirements were the problems in running agri-tourism farms.
Keyword: Agri-tourism Business; Development Plan; Farm Tourism
INTRODUCTION
The Philippines is an agricultural country with rich culture and scenic spots.
With thousands of unique islands making up this archipelago, tourists have lots of
picturesque places to visit.
The Philippines' tourism industry has been identified as a powerful engine for
strong and sustained economic growth (Pilapil-Añasco & Lizada, 2014). In fact,
foreign tourist arrivals to the country continue to increase with 5.9 per cent growth
in the first two months of 2019 compared to the same period last year (Rocamora,
2019).
Likewise, agriculture remains a vital part of the country’s economy.
However, its contribution to the gross domestic product (GDP) has continuously
declined for the past several years and even decreased to 10% last 2017 (Brown,
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2018). The future challenges facing agriculture will require a paradigm shift from
a production orientation to a market-centric orientation. One way of doing this is
by way of farm diversification through agri-tourism.
Agri-tourism, also called farm tourism as defined by the Department of
Tourism (DOT), is an activity done in rural areas, where all stages of agriculture
and processing of farm products take place (Lago, 2017). In support of this one of
the fastest growing sectors of the economy, R.A.10816 or the Farm Tourism
Development Act of 2016 was signed into law which provides guidelines for the
promotion and development of farm tourism or agri-tourism in the Philippines.
The Philippine topography is very ideal for agri-tourism (Recio et al., 2014)
because of its diverse geographic condition, a relatively English-speaking
environment, tropical climate and government initiatives (Spire Research and
Consulting, 2013). In fact, Philippine was ranked as one of the top eight agri-tourism
destinations in the world last 2012 (Lew, 2012). Southeast Asian Regional Center
for Graduate Study & Research in Agriculture (SEARCA) also stated that the
country is now among the world's top agri-tourism destinations, making it par with
other agro-tourism sites over the world (Spire Research and Consulting, 2019).
The boost of agri-tourism industry in the Philippines can bring several
benefits such as economic growth, social benefits and heritage and cultural
conservation (Spire Research and Consulting, 2013). With these numerous benefits
of agri-tourism to local residents, different parts of the country are being initiated
with this concept (Recio et al., 2014).
Central Luzon, for instance, has a big potential in agri-tourism industry
because of its strategic location that offers accessibility for the movement of people,
goods and services from the North to Manila. In addition, it remains as the rice
granary of the Philippines (Central Luzon still PHL’s, 2018).
However, since agri-tourism is just a new venture in the Philippines, this
industry's potential benefits have not yet been maximized despite the presence of a
number of successful agri-preneurs in Central Luzon. Based on the record of DOT
website in 2018, there are only 14 DOT-accredited agri-tourism sites in the region
and no farm in Zambales was included in the list.
Only a few researches have been conducted on the area of agri-tourism in the
Philippines, and most of the research has been conducted in Region 4A
(CALABARZON) as there are a number of pioneers agritourism farms established
in the region. Lago (2017) had determined the supply and demand related-factors
for agritourism development in Quezon province. Likewise, Recio et al. (2014)
have studied the status of prospects of agri-tourism in selected municipalities of the
4th District of Batangas wherein they identified the socio-economic and
environmental benefits of agri-tourism in the community. They also found out that
studies like this educate people to be more vigilant enough to give importance to
agri-tousim in their area.
Unfortunately, based on the best of the researcher's knowledge, no study so
far has been conducted on agritourism farms in Central Luzon which could be of
great help in promoting this industry in the region. Hence, there is the need for this
study in order to identify the profile of farmers who generally go for agri-tourism;
analyze the status of their existing business operations; determine their best
practices and identify the gaps in their conduct of business which will form as basis
for the formulation of development plan to boost the agri-tourism industry. Through
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this study, farmers and agri-preneurs can vividly picture the profile and status of
agri-tourism business operations in the region.
METHODOLOGY
The study employed a mixed method of quantitative-qualitative research
using a concurrent nested design. By including both quantitative and qualitative
data, the study explained both the process and outcome of agri-tourism business
operations through comprehensive observation and analysis of the cases under
study.
Quantitative technique was used in gathering data about the profile of agri-
tourism sites, the status of their business operation in terms of organization and
management, marketing and production/operation and finance operation, their best
practices and problems encountered while qualitative approach was used in
gathering their responses during the follow-up interview in order to further clarify
and verify their answers to the questionnaires.
Respondents were the farm-owner/operators based on the list provided by the
Department of Tourism website in 2018. A purposive sampling technique was
employed in selecting the target respondents.
A total of six farm operators and 30 visitors were the respondents who were
surveyed and interviewed. Two sets of modified survey questionnaires formulated
from the combination of survey questionnaires used by Pinky (2014) in her case
study on Agri-tourism in Punjab; Simangan (2012) in his Dissertation on Marketing
Strategies of Selected Micro-Manufacturing Enterprises using 4Ps; and Barbieri &
Tew (2009) in their survey on “Preliminary Assessment of Agri-tourism in
Missouri” were used in gathering the needed data of the study. These questionnaires
were modified based on the statement of the problem of the present study in order
to ensure that only the needed data were gathered from the respondents. The
questionnaire for farm operators was comprised of four parts. Part I dealt with the
profile of the agri-tourism farm such as location, farm ownership, category, farm
size, years in operation affiliations and accreditation. Part II included questions
regarding the status of agri-tourism business operation in terms of its four core
business components including organization and management, marketing,
production/operation and finance. Part III and Part IV were open-ended questions
asking for the best practices and problems encountered by the farm operators in
their agri-tourism business, respectively.
Likewise, the questionnaire for farm visitors was comprised of four parts. Part
I dealt with their demographic profile such as age, sex, civil status, educational
attainment and primary occupation. Part II included questions regarding their
perception on the agri-tourism business practices in terms of marketing,
production/operation as these were the areas that they have direct exposure to. Part
III and Part IV were open-ended questions asking for what they considered as best
practices of the agri-tourism farm they have visited and the problems that they
encountered in the areas of marketing and operation/production, respectively.
Frequency count, percentage distribution and rank were the statistical tools
used in data analysis. The financial analysis included Return on Investment, Return
on Assets and Payback Period.
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RESULTS AND DISCUSSION

Results
1. Profile of Agri-tourism Business in Central Luzon
Half of the respondent agri-tourism farms are located 30-59 kilometers from
the city area while majority (66.67%) of them are less than one kilometre near the
paved highway. The smallest farm size that can be used to start an agri-tourism farm
is one hectare which has expanded to 4.8 hectares progressively as their agri-
tourism operation commenced. Majority are classified as farm resorts while the
remaining two other farms operate only as a day farm. The majority are also
operating farm business as a family corporation wherein the top management as
well as its major personnel are composed of the family members.
Two of the respondent farms were already established as a farm devoted to
purely agricultural production as early as 1978 and 1980. However, respondent 1
(2015) and respondent 3 (2008) have already started agri-tourism operation even
before the enactment of R.A. 10816 through accepting visitors to their farm for free
as their way of promoting agriculture to visitors.
All the respondent farms are affiliated with the Department of Tourism
(DOT) and Department of Agriculture-Agricultural Training Institute (DA-ATI)
and Central Luzon Farm Tourism Association. Four of the six respondent farms are
also TESDA accredited as a training school offering short training courses for
National Certification.
2. Agri-tourism Business Operation in Central Luzon
a. Organizational and Management
The Organization and Management summarize the information about the
business' organizational structure, business members' duties and expertise, as
well as their education or qualifications.
Farm operators of all the respondent agri-tourism farms are also its farm
owners indicating the hands-on management and commitment of farm owners
in running their agritourism business. Four out of the six respondent farm
operators are above 50 years old while the remaining two belong to the age
bracket of 46-50 years old. Majority are male, married, educated, full-time
farmers and self-managed their family-run business.
All the respondent farms are imposing their own policies in their business
operation which includes “no smoking”; wearing of safety gears for safety
first policy; house rules for those offering accommodation; reservation policy
of “no show, considered paid once the slot was reserved”; and swimming
attire for those with swimming pools. Majority (66.67%) of them employs 1-
5 regular employees.
Two out of six farms have 4 to 6 paid family members. In contrast, only
one farm has above 10 family members paid for the services they rendered as
if they are ordinary employees receiving monthly salary. On the other hand,
two farms have 1 to 3 family members who worked in their farms unpaid.
Likewise, there are also two farms that used the services of their 4 to 6 family
members free of charge, but only share with the annual income of the farm.
All of them give bonus to their employees. Majority (66.67%) of them gives
allowances which usually include free meals) while only half of them gives
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13th month pay. Notably, only one of the respondent farms complies with all
the statutory benefits being provided to their employees.
All the respondent farm operators have attended various trainings needed
to enhance their skills in managing agritourism farms such as practising
agritourism, rendering services and hosting and tour guiding.
b. Marketing Status of Agri-tourism Businesses

The status of marketing practices of agritourism businesses in Central
Luzon is analyzed by determining the presence of business and marketing
plans used by agri-tourism operators, describing the nature of their
agritourists/visitors, presence of competitors, pricing scheme and
promotional strategy used.
Five out of the six farms have written business plans as this is required by
DOT which they used as guide in running their business. All of the farms
have already entertained different kinds of visitors who have a common goal
of learning and experiencing a farmer’s daily life in the presence of nature.
Consistently, most of the visitors who were interviewed during the data
gathering period belong to school groups and organizational groups who are
undertaking their short course/training for National Certificate assessment.
Majority of whom came from within the region (40%) and within the province
(33.33%). Likewise, all the respondent farms stated that they have existing
competitors in this industry. However, the other half of the respondent farms
admitted that though, they are partners, but the fact that prospective visitors
may opt to visit other farms over them still poses a threat of competition.
For general admission or entrance fee, the majority of the farms have a
price ranging from P100 to 299. Only two visitors have paid general
admission fee of P30 and rented a cottage for P500. The four respondent farm
resorts' accommodation price depends on the classification and type of rooms
ranging from as low as 500 to as high as above 2500, but most of them have
a room offered for the price of above 2500. All the agritourism farms have a
function hall available for rent at the price of 5000 to 10, 000 pesos depending
on the occasion and seating capacity. However, visitors usually avail agri-
tourism services in package, majority (43%) of which are TESDA sponsored
(P10,000 inclusive of meals, accommodation and other trainings materials for
22 days) while others (20%) are DA-ATI sponsored (P500-700 inclusive of
one-day tour with meals and snacks)
The most common promotion objective of agri-tourism farms is to create
product awareness because agritourism is still a new concept and has recently
launched a promotional campaign. Almost all (5/6) of them also want to
increase their volume of sales and profit as their reason for the conduct of
different promotional strategies. In terms of promotional methods, agri-
tourism farms usually promote their farm product and services through the
use of social networking sites, listing in specialized directories, printed
material, referral system and through an association. Consistently, most of the
visitors interviewed heard about the existence of agri-tourism farm through
their association, which was tapped by either TESDA or DA-ATI for training
sponsorship followed by listing in specialized directory the DOT website.
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c. Operation/Production Status of Agri-tourism Business

The status of agri-tourism farm operation and production is described by
presenting products and services offered, waste disposal, facilities and
amenities and process and service operation.
Among the different products and services offered, classes, seminars or
workshop and tours are the top service offerings of the six respondent
agritourism farms which tied on the top spot followed by u-pick or u-harvest,
observation of agricultural processes, petting zoos or farm animal displays
and festivals, events and shows. In terms of accommodation and food
services, the top four common services that the four farm resorts offer to their
visitors were bed and breakfast, farm vacations, campsite and hotel, inn, lodge
or resort while the top events that their farm have hosted so far is
trainings/workshops/seminars which is usually booked by DA-ATI or
TESDA for their sponsored short trainings courses. During an interview,
visitors agree with the findings as they said that hotels, inns, lodges or resorts
ranked first among the accommodation facilities availed by them specially in
the four farm resorts because their NC trainings usually last for several days.
The top two and three accommodation and food services being availed by
visitors were bed and breakfast and catering or customized meals as these are
usually availed in package by the sponsoring agency. As to the events hosted
by farm that the visitors have attended, trainings/workshops/seminars ranked
first followed by weddings or private parties and corporate or similar retreats.
The result is consistent with the previous tables' findings since most of the
visitors were students who are undergoing NC training.
In terms of add-on services, all farms offer welcome drinks to visitors,
three have private label products while only one farm (respondent 6) accepts
debit or credit card payment mode so far. The same is true with visitors'
responses wherein bottled water or soft drinks rank first followed by private
label products such as wine and salted eggs as add-on services availed by
them. Only three farms have value-added products being offered for sale.
Respondent 4 offers salted eggs. Respondent 6 offers salted eggs and pastillas
while respondent 3 sells wine made out of bignay fruits which was already
approved by the Bureau of Food and Drugs and registered in the Department
of Trade and Industry.
All the four respondent farm resorts have accommodation/lodging and
restaurants which are additional requirements for them to be accredited as
farm resorts. The two accredited day farms do not yet have
accommodation/lodging as of now but they have plans to establish such if
they will have extra funds. Consistently, all farm operators state that their
farms also have all the required sanitation facilities such as wash area,
restrooms, garbage cans and garbage disposal/waste management in order to
ensure the cleanliness of the farm area.
As to safety and security, safety signages, “off-limit” areas, first aid kit
and farm equipment are available in all the respondent farms, which is
consistent with visitors' responses. Only one farm has security personnel as
farm operators of other farms explained that they do not need such because
they feel that their farms are safe and secured. They only request assistance
from local police and “barangay tanod” if there are big events hosted in their
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farm. Majority of them (5/6) also have CCTVs installed within their farm
premises as form of monitoring and security measures as well. Five out of the
six farms have firefighting facilities while the other one already has plan to
add such.
Half of the respondent farms are already receiving visitors for 6-9 years
already. Two farms receive visitors for more than ten years while the
remaining one had just opened his farm to visitors 3-5 years ago. The result
indicates that farms were already practicing agritourism and entertaining
visitors even before they became accredited by DOT.
As to operating hours, respondent 1 and 6 conduct operation for 24 hours.
Respondent 3 and 5 are open for 10 hours to accept visitors (although they
offer overnight accommodation) while the two day-farms (respondent 2 and
4) are only open for 8 hours. As expected, since four out of the six respondent
farms are farm resorts, majority of the visitors interviewed said that they have
stayed for 24 hours or an overnight stay in the farm.
All farm operators stated that their agri-tourism farms have visitors log
book which served as database of those who visited their farm in order to
secure valuable information of their visitors that can be used in the future
which was proven true as all the visitors interviewed have signed a logbook
upon their entrance in the farm.
All the respondent agri-tourism farms have owned waste disposal method
as they are practicing composting to produce organic fertilizer as part of their
advocacy towards organic agriculture. Notably, respondent two has owned
Material Recovery Facility (MRF) in his farm as he is recycling the non-
biodegradable wastes such as scrap metals, tin cans and wood which he used
as fence in his planting area. This waste disposal method is part of the
agricultural practices being taught by farm operators to their visitors in order
to promote proper waste management for a healthier environment.
3. Best Practices of Agri-tourism Business

Farm owners have identified their perceived best practices in their agri-
tourism business. Being a family-run farm, commitment of farm owners and hands
on management to what they are doing are the common best practices of all the six
respondent farms in terms of organization and management which is consistent with
the best practices identified by the visitors.
Word of mouth/referral system, linkage with government agencies and social
media presence are the common best practices that farm operators have identified
in their marketing strategy while in terms of operation/production, streamlined
chain of command is the identified best practice common to all the respondent farms
as these farms are family business.
Good relationship with other farmers in the community is also identified as
best practice by four out of six farms because farm operators consider them partners
in promoting agritourism concept in the community. Notably, visitors identified
that demonstration of good agricultural practices and active involvement of farms
in various government activities as other best practices which keep them visiting
the farm.
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4. Problems Encountered by Agri-tourism Business

Labor shortage or labour competition with other industries is the common
problem encountered by farm operators in terms of organization and management.
As to marketing status, being still a niche market, price fluctuation of raw materials
supply and the seasonal nature of farm products and services were noted problems
encountered. Unpopularity of agritourism to mass market is also perceived as a
problem by three visitors who stated that they totally have no idea about agritourism
if they have not been part of the group of NC trainees. Visitors explained that this
could also be due to the difficulty accessing these farms' websites as only two of
the respondent farms have functional websites.
In terms of operation/production, insufficient skills of staff were identified by
majority (4/6) of the farm owners because they experienced difficulty in recruiting
quality staff due to stiff competition with other industries offering higher salary to
the applicants. Notably, inaccessibility of the road going to their farm is also
identified problem by the farm operators which is consistent with the problem
identified by the visitors who noted location and the inaccessibility of public
transportation vehicle as problems encountered by them. In addition, visitors'
unfavourable weather condition during their tour around the farm also caused
difficulty to the them roaming around the farm area.
Unanimously, big capital requirements and big expenditures and operational
expenses in running agritourism farms are the identified problems encountered by
all the six respondent farms. Surprisingly, two agritourism farms noted that political
factor in their location posts additional problem to them because of their
bureaucratic process in processing legal documentary requirements.
DISCUSSION
1. Profile of Agri-tourism Business in Central Luzon
Location of agri-tourism farm may be a consideration for the agritourist in
deciding which farm to visit. It is the number one factor critical to success and since
agritourism is primarily a subset of tourism, location emerges as the primary factor
of success (Comen, 2017). Agri-tourism farms in Central Luzon are accessible to
potential visitors but are located farther than what Jiang & Wang (2018) concluded
in their study that agri-tourism location closer to the city (less than 20 km) is
preferred. Lucha (2015) also found that agri-tourism sites near the metropolitan
areas tended to have the highest perceived profitability. Barbieri & Tew (2010) on
the other hand, found that proximity of the farm to highly populated areas is neither
an impediment nor an advantage to the number of visitors received.
The size of the business also matters as one can take advantage of economies
of scale wherein large farms perform well (Hung et al., 2016) which is contrary to
the findings of Schilling et al. (2014) that commercial-scale farms did not increase
profits by engaging in agri-tourism. Agri-tourism in Central Luzon has an
increasing trend in the farm size from start to present. This indicates that farmers
who want to venture into this kind of business can do so if they have at least one
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hectare of farmland. Barbieri & Tew (2010b) concluded that farm acreage should
be considered neither an impediment nor an advantage in agri-tourism development
The ratio on the classification of agri-tourism in the region reflects the ratio
of the data on the list provided by DOT as there are more DOT-accredited agri-
tourism farms classified as farm resorts than day farm. This can be due to the reason
that farm operators believe in the big potential of agri-tourism business as an
additional source of income which motivates them to continue developing their
farm and invest more in infrastructure (inclusion of restaurant, accommodation
facilities and other farm attractions), thus converting their farm from being
classified previously as day farm into farm resort. Farm Tourism Development Act
of 2016 (R.A. 10816) describes a day farm as an ideal for day tours/visits usually
located near national highways and main business areas while a farm resort is a
farm that offer accommodation and dining services, for the purposes of
participating in or enjoying interactive on-farm activities and other attractions
offered to enrich the tourist’s farm life experience.
Bagi and Reeder (2012) found that individual and family-owned farms are
more likely to adopt agri-tourism like in the case of agri-tourism farms in the region.
They were experienced farmers as they have been actually practising agri-tourism
even before the enactment of Farm Tourism Act of 2016 but they are unaware that
what they are doing is actually agri-tourism. Barbieri & Tew (2010)found that farm
visitation builds over time which implies that the longer the farm operates the more
visitors it receives. Lucha (2015) hypothesized that experienced operators in
agriculture and business are more likely to be successful and their businesses more
profitable.
A big factor in the agri-tourism business in the region is the linkages to
various stakeholders that provide support to the farm owner. Being affiliated with
various government agencies is a big advantage as they were prioritized to become
venue of various pieces of training from where they generated a big percentage of
their income. Lun et al. (2016) also noted that inter-sectoral networks' presence
seems to be key success factors to overcome potential obstacles in rural tourism
development. Vahauski (2016) also found that networking is needed in engaging
profession of farm tourism entrepreneur. Intensive business networking augments
overall farm profitability perceptions. Farms with higher number of visitors are
more involved in agricultural groups and associations (Barbieri & Tew, 2010a).
Reid (2017) noted that horizontal networking creates efficiencies within a sector
like knowledge and cost-sharing, marketing consortia or purchasing linkages.
Vertical networks can help to leverage limited resources more effectively.
2. Agri-tourism Business Operation in Central Luzon

Organizational and Management
Being a family-run business seems to be beneficial to the agri-tourism farms.
Farm owners explained that since agriculture is their passion, they made sure that
they, themselves together with their family's help, are involved in conceptualizing
and designing even the smallest details of their farm. Unfortunately, majority of the
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farm operators are already old age. This can be attributed to the fact that majority
of them are retired employees who opted to spend the rest of their lives in simple
living managing their own farms. But they are managing their farm with family
members' help, which indicates the importance of family members' involvement in
running an agri-tourism farm. Page and Connell (2012) as cited in Recio et al.
(2014)stated that family labour tends to be the main source of assistance in farm
tourism enterprises. The legacy has to be passed on to the young generation who
has a big potential to earn more as Barbieri & Mshenga (2008) found out that farmer
age was inversely related to agritourism business performance. Schilling et al.
(2014) also found that the younger the farmer-owner, the more profitable is the
business. To realize this, there is a need for more comprehensive trainings
especially in the field of tourism as most of the trainings undergone by farm
operators were agriculture-related.
Agri-tourism farm owners in the region are male-dominated which reflects
the case of agriculture in the Philippines. But this is contrary to the findings of
McGehee et al. as cited in Delfino (2014) concluded that females had motivation to
start agritourism enterprise than males. A big advantage is the fact that agri-tourism
operators in the region are educated as education is significant factor in agri-tourism
farm performance (Joo et al., 2013). Relevant profession and educational
background of entrepreneur as well as enthusiasm are important (Vahauski, 2016).
Lago (2017) also noted that the higher the educational attainment of farmers, the
more capable they are in supplying agri-tourism products and activities. Reid
(2017) further posited that the owner of agritourism could act as educator, provider
of safe local food and experiential tourism as agri-tourism is focused on the
experience of being on a working farm.
a. Marketing Status of Agri-tourism Businesses
Toner & Webster (2011) found in their study that marketing skills are
essential to successful recreation-based enterprise which is usually an
unfamiliar task for private landowners. Unfortunately, the absence of a
concrete business and marketing plans of agri-tourism farms in Central Luzon
prevents them from maximizing their business potentials. Barbieri & Tew
(2010) also noted that farms in Missouri operate with no written business or
marketing plans. A well-thought of plans (not just plans for the sake of
complying with the DOT-requirements), could have enabled the farms by
serving as guide in exploring opportunities in this industry.
Visitors of agri-tourism businesses in Central Luzon were basically from
all walks of life and came from within and outside the country. Tourists in
this type of rural tourism are allowed to visit farms and experience a farmer’s
daily life (Kunasekaran et al., 2011). According to the farm operators,
majority of their visitors are usually students from tertiary level who came in
school groups having their educational trip in the farm in order to better
appreciate agriculture. In addition, they further explain that bulk of their
student-visitors are composed of those undergoing training for NC
assessment from which they actually generate the biggest percentage of their
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farm revenue. The result shows the advantage of being accredited learning
sites of TESDA in attracting more agri-tourism visitors and gaining more
exposure to wider visitor groups as well
The pricing scheme is considered affordable by the visitors that were
interviewed although they do not pay for their stay in the farm as majority of
them have availed agri-tourism services paid by TESDA who sponsored their
trainings followed by those paid by DA-ATI. Farm owners explained that
visitors may opt to pay additional charges depending on the activity that they
want to experience in which majority of the farms offer for the price range of
300 to 499 pesos. Expanded, reasonably priced and easily accessible product
is a success factor (Vahauski, 2016). Farmers are price makers, not price
takers (Reid, 2017).
Farm operators explained that the most effective promotional method is
referral system wherein their satisfied previous visitors’ testimony of their
experience in the farm really brought more visitors in their farm in order to
try and experience the same. Notably, there are already two farms that can be
accessed through various computer reservation systems such as Traveloka
and Tripadvisor, which play a vital role in improving accessibility in the
tourism sector. Agri-tourism should focus on tourist experience and create a
marketing message based on these experiences to appeal to potential
travellers' emotions (Hudson & Ritchie, 2009). Yeboah et al. (2009) found
out that successful case study farmers used a combination of marketing
strategies including internet, farmers market, contracts and direct sales to
restaurants and grocery stores. Barbieri & Tew (2010) concluded that farms
with greater number of visitors received used more marketing techniques such
as personal selling strategies, internet, web page and blogs.
b. Operation/Production Status of Agri-tourism Business
Lun et al. (2016) noted that creation of quality products and services seem
to be fundamental criteria for successful rural development. In the case of
agri-tourism farms in Central Luzon, classes, seminars or workshops as most
visitors are students who are undergoing NC training are the top services
offered by the farm followed by tours and u-pick or u-harvest. Phillip et al.
(2010) noted that products in agri-tourism can include anything from
overnight farm stays to educational seminars. Farm operators explained that
more products and services will be offered soon as they are still on the process
of developing their farm to make it more attractive to visitors. Production of
value-added products has a big potential in respondents farms if given support
by the concern agencies.
In terms of facilities and amenities, since all the six respondent farms are
DOT-accredited as they are all compliant with the minimum required
facilities that must be available in an agri-tourism farm. As expected, since
four out of the six respondent farms are farm resorts, majority of the visitors
interviewed said that they have stayed for 24 hours or an overnight stay on
the farm. This indicates that the stay of farm visitors can be maximized if
there are accommodation facilities available for visitors’ overnight stay as
Vol 06 No 02, 2020: 40-60
visitors said that their purpose of going to the farm aside from learning is to
relax in serenity and good scenery. Revenue increases with the number of
business days open (Schilling et al., 2014). The qualities offered to the
customers that make them feel special are also keys to business success
(George & Rilla, 2011).
All respondent farms also have owned waste disposal system. Farm
owners explained that organic fertilizers could be produced from their wastes
which are then being applied in their crops in order to produce safer and
healthier food for their family and visitors. Likewise, since safety and security
become the major consideration of tourists to visit agri-tourism sites (Lago,
2017, farm owners have to assure their visitors that it is safe to stay on their
farm. However, assurance of tourists' safe stay in the farm is still questionable
as only one of them have security guard so far.
3. Best Practices of Agri-tourism Business
Being a family-run farm business was seen as an advantage in terms of
organization and management of agritourism business since conflicts gets easily
resolved, and employees who are composed of family members have genuine
concern for the welfare of the business. The hands-on operation of farm operators
who are very responsive to their needs during their stay in the farm was perceived
by the visitors as one of their best practices. Having a very knowledgeable farm
operator who acted as farm guide is also considered by visitors as best practice
because according to them, learning is the primary reason of their visit to
agritourism farm. The chain of command is short and simple as the family members
can go directly to the farm operators if there are concerns or problems that need
immediate actions.
Farm operators further explained that word of mouth or referral system is the
most effective promotional strategy in their case as most of their previous visitors
told them that they learned about their farm from their friends or family members
who have been there before and who shared them their experiences in the farm.
This implies the importance of visitor satisfaction with their experience in the farm
as word of mouth is very powerful in promoting agri-tourism farms. This is
consistent with the findings of George & Rilla (2011) that word of mouth is the
most powerful and inexpensive promotional method. It is the most effective way of
promoting agri-tourism (Barbieri & Mshenga, 2008).
Good relationship with other farmers in the community is also identified as
best practice by four out of six farms because farm operators consider them partners
in promoting agritourism concept in the community. The same is true with the result
of interview conducted by Agritourism Philippines in 2013 from some agritourism
operators on what they consider as best management practices for agritourism
which includes authentic farm experience, educational experience, customer
service, adequate public facilities, safe and accessible environment, community
relations and planning for your financial future (www.agmrc.org.)
Vol 06 No 02, 2020: 40-60
4. Problems Encountered by Agri-tourism Business

The problems encountered by agri-tourism farms in Central Luzon are
consistent with the problems noted by Pinky (2014) which include insufficient fund
for publicity; lack of government support, insufficient literature related to
agritourism practice and lack of training for agritourism are some of the problems
being encountered by farm operators in Punjab. Farm owners claimed that
agritourism farms are not suitable for small farmers as of now since venturing in
this kind of business requires high initial capital and still needs high working capital
to finance its operating expenses.
In addition, labor shortage being experienced by agri-tourism farms in Central
Luzon can be attributed to the reason that graduates nowadays prefer working in
offices and other business districts than working in the farm away from the luxury
and busy life in the cities. Hence, farm owners expressed that they have experienced
difficulty in recruiting quality staff. Even worst, those quality staff that they have
recruited before are also resigning after few months or years of working in the farm
resulting to high employee turn-over.
Farm owners further explained that agritourism industry is still young and
they really faced a big burden on how to introduce this concept and promote this
new brand of tourism to the mass market in order to increase tourist arrivals/visitors
in their farm. However, during off-season, visitors cannot maximize their stay in
the farm for they hardly observe actual farm demonstration or harvesting of
produce.
Unfortunately, The Manila Times Online in December 2017 reported that
agritourism in the Philippines faces a development hurdle because of its non-
inclusion in the Investment Priorities Plan (IPP) 2017 as well as the lack of
financing for cooperatives were identified as the major development gaps that
hinder Philippine agritourism development.
Proposed Development Plan
A development framework for agri-tourism business in Central Luzon has
been formulated afterwards based on the findings of the study. The long-term, high-
level goal for agri-tourism development is to boost agri-tourism industry through
strengthening agri-tourism businesses in Central Luzon which is linked to four
strategic areas of focus. A guiding objective applies to each of the focal areas.
Strategic actions for each of the four focal areas are outlined below. Each
strategic action for development plan identifies the key constraints, key strategies,
lead stakeholder responsible for implementation, performance indicator, target,
means of verification and time frame (see Table 1 to 4 below).
Vol 06 No 02, 2020: 40-60
Table 1. Detailed Development Framework for Focal Area One
Focal Area One- Institutional Development

Objective: Enhanced organizational structure of agri-tourism business
Key Key Strategies Lead Performance Target Means of Time
Constraints stakeholder Indicator Verification Frame
responsible
1. Employee Offer Farm Employee Reduce Employee 3-5
turn-over competitive owner turnover employee turn- records years
compensation rate over rate by
package and 10% per year
career growth
2. Difficulty Professionalize CHED Number of Increase the List of 2-3
recruiting agri-tourism newly hired number of employees years
quality DA/ATI
industry quality staff newly hired
staff DOLE qualified
employees by
DOT 10% per year
Farm (as the need
Owner arises)
LGU
3. Lack of Provide DA-ATI Written Formulate all Copy of 1-2
written technical rules and rules and operation years
rules and DOT
assistance in policies policies of the manual
policies writing farm Farm business by
rules and Owner 2020
policies
LGU
Table 2. Detailed Development Framework for Focal Area Two
Focal Area Two- Sector linkages, accreditation and certification

Objective: Increased linkages and gained accreditation from concerned agencies
Key Constraints Key Strategies Person/Ag Performan Target Means of Time
ency ce Verificati Fram
responsibl Indicator on e
e
Vol 06 No 02, 2020: 40-60
1. Agri-tourism Provide assistance to TESDA TESDA At least one Copy of 3-5

farm needs the farm operators in accreditati agri-tourism TESDA years
TESDA and Farm
preparing on farm passed Certificat
DA-ATI owner
requirements for TESDA e as
accreditation TESDA and DA- LGU accreditation learning
to increase ATI accreditation per year sites
visitors and
augment
income
2. Value-added Provide assistance to FDA Organic At least one Copy of 3-5

products the farm operators in certificatio value-added FDA and years
need FDA DTI
preparing n product DTI
and DTI requirements for LGU certified by certificat
accreditation Organic FDA and
FDA and DTI e
for mass certification, and Farm per year
DTI
marketing owner
FDA and DTI registratio
registration of their n
value-added
products
3. Limited Provide assistance in DOT Linkage At least one Presence 1-2
linkage with linking agri-tourism with linkage with in farm years
online travel DA-ATI
sites with the online linkage online travel sites in
search travel search Farm with search online
platform platforms to increase owner online platform travel
exposure and travel established per search
accessibility LGU search year platform
Travel platform online
agencies page
4. Limited Provide assistance in DTI Establishe At least one MOA/M 1-2

linkages for establishing market d market market linkage OU with years
market LGU
linkages with linkage with business business
destination business Farm establishment establish
of value- establishments owner per year ment
added (hotel, restaurants,
products DOT
etc.)
DA
Vol 06 No 02, 2020: 40-60
Table 3. Detailed Development Framework for Focal Area Three

Focal Area Three- Human Resource Development
Objective: Enhanced knowledge and skills of agri-tourism operators and employees
Key Constraints Key Strategies Person/Ag Performance Target Means of Time
ency Indicator Verificatio Frame
responsibl n
e
1. Limited Provide DA-ATI Number of At least one Training 1-2
tourism and trainings on CHED/SU tourism and tourism and document years
hospitality tourism and Cs hospitality hospitality ation
management hospitality DOT management management
skills management LGU trainings skills training
conducted conducted per
year
2. Limited Provide DA-ATI Number of At least one Training 1-2
marketing trainings on CHED/SU marketing marketing document years
skills marketing Cs skills trainings skills training ation
DOT conducted conducted per
LGU year
DTI
3. Limited Provide DA-ATI Number of At least one -Training 1-2
processing/v trainings on CHED/SU product value- value-adding document years
alue adding product value- Cs adding and skills training ation
skills adding and DOT handicraft- conducted per -Sample
(souvenir, handicraft- LGU making year value-
handicraft- making DTI trainings added
making) conducted products
and
handicraft
s produced
4. Technology Provide DA-ATI Number of At least one Training 1-2
skills technical CHED/SU technology technology document years
limitation intervention on Cs skills trainings skills training ation
technology DOT conducted conducted per
skills LGU year
enhancement DTI
Table 4. Detailed Development Framework for Focal Area Four

Focal Area Four- Value chain support
Objective: Improve value-chain support to boost agri-tourism industry
Key Key Strategies Person/A Performance Target Means of Time
Constraints gency Indicator Verification Fram
responsibl e
e
Vol 06 No 02, 2020: 40-60
1. Transp Tap DPWH - -Farm to Road and 3-5

ort and concerned LGU Constructed market road other years
infrastr government road and constructed infrastructur
ucture agencies for other and road e in use by
constra transport and infrastructur signages the general
ints infrastructure e posted within public
support 30 kms away
-Established going to farm
partnership sites MOU/MOA
with -at least one
transport partnership
group with
transport
group
established
2. Supply Provide DTI -established -at least one MOU/MOA 1-2
chain assistance in DA linkage with linkage with Copy of years
limitati sourcing out Farm supplier supplier Contract
on raw materials owner established
needed in the
agri-tourism
farm
operation
3. Insuffi - DTI -Awareness -At least one - 2-3
cient Collaborative LGU campaign awareness Documentat years
marketi support in Farm conducted campaign ion of
ng staging owner -Tourism conducted awareness
support strong package and one campaign
awareness launched tourism -percentage
campaign package increase in
and inclusion inclusive of the list of
of agri- agri-tourism visitors
tourism in launched per -Copy of
tourism province tourism
package of package
LGUs
4. Limite -provision of DA Agritourism At least 20% -Copy of 1-2
d financial LBP financial increase in contract/MO years
financi incentive DBP incentive financial A/MOU of
al scheme to LGU scheme resources financial
resourc farm DOT launched /fund incentive
es operators Farm sourcing of scheme
owners agritourism
sites
Vol 06 No 02, 2020: 40-60
CONCLUSION
Small-scale family-own farms were usually the type of farms that venture into
agri-tourism business. There is still so much to be done in terms of organization and
management, marketing and production/operation aspects of the agri-tourism farms
in order to boost this industry in the region. Support from various stakeholders
should be extended to the farm owners in order to maximize the potential of their
farm in agri-tourism. The crafted development plan may serve as a reference to
DOT and other concerned government agencies in addressing the problems
encountered by both farm owners and visitors so as to stimulate the growth of this
new industry.
ACKNOWLEDGMENT
The researcher would like to extend the deepest gratitude to Dr. Richard V.
Simangan for his guidance in the conduct of this study as well as to the respondents
for sharing valuable information relevant to this study.
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Journal of Business on Hospitality and Tourism ISSN 2527-9092

Vol 06 No 02, 2020: 40-60

Submitted: 29th August 2020

STATUS OF AGRI-TOURISM BUSINESS IN

Imee De Guzman Esguerra

Keyword: Agri-tourism Business; Development Plan; Farm Tourism

RESULTS AND DISCUSSION

b. Marketing Status of Agri-tourism Businesses

c. Operation/Production Status of Agri-tourism Business

3. Best Practices of Agri-tourism Business

4. Problems Encountered by Agri-tourism Business

2. Agri-tourism Business Operation in Central Luzon

4. Problems Encountered by Agri-tourism Business

Table 1. Detailed Development Framework for Focal Area One

Focal Area One- Institutional Development

Table 2. Detailed Development Framework for Focal Area Two

Focal Area Two- Sector linkages, accreditation and certification

1. Agri-tourism Provide assistance to TESDA TESDA At least one Copy of 3-5

2. Value-added Provide assistance to FDA Organic At least one Copy of 3-5

4. Limited Provide assistance in DTI Establishe At least one MOA/M 1-2

Table 3. Detailed Development Framework for Focal Area Three

Table 4. Detailed Development Framework for Focal Area Four

1. Transp Tap DPWH - -Farm to Road and 3-5

Delfino, C. (2014). A Case Study on the Apple Hill Grower’s Association: An

Vahauski, J. (2016). Success factors in farm touris- Qualitative Study of farm

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