TRADITIONAL MEDICINE FOR SELF-RELIANCE (TMSR)

Organizational Vision
Citizen Base Strategy
How It's Working
Lessons Learned

Organizational Vision

TMSR is working on several fronts to revisit Thailand's history of traditional medicine and self-help through herbal and organic products (as opposed to expensive Western medicines). It is also seeking promote organic farming to help limit environmental degradation caused by pesticides.

TMSR directly supports rural farmers by collecting and disseminating information on holistic health, organic farming, and herbal products, as well as seeking to improve the legal environment by lobbying for new legislation which would improve the production, distribution, and availability of holistic products.

Citizen Base Strategy

Ten years ago, TMSR founder, Rosana Tositrakul, recognized that to be fully committed to organic farming and the production of holistic products, farmers needed to financially gain from these efforts. TMSR realized that it had not been thinking about the economic market, and without doing so, it could not influence farmers' choices.

TMSR recognized that it needed a vehicle that would provide an economic market for herbal products, thereby ensuring a financial incentive for farmers to change their production priorities.

During this same period, TMSR faced its own financial pressures. "TMSR was originally funded by donor agencies," recalls Tositrakul, "but ten years ago we were warned that these agencies would be moving out of Thailand. The agencies estimated that funding for NGOs in Thailand would be cut by 60-70 percent over the next few years." TMSR began to seek an alternative in local resource mobilization.

But like other environmental citizen sector organizations, TMSR found it difficult to fundraise locally. Thais are less inclined to donate to environmental initiatives, as children-related issues are more popular amongst the public.

At this time, TMSR also had developed its first organic products: rice and a few herbal medicines. To generate income for the farmers, TMSR opened an outlet in Bangkok to sell these products.

The products sold well, thereby giving TMSR the necessary support to expand this effort. Four years ago, TMSR strategically broke into two arms: the Thai Holistic Health Foundation (THAIHOF) and Friends of Nature Club (FON). The former is the nonprofit arm of the organization, responsible for the advocacy, legal, and social campaigns that the organization pursues in this field. The latter is the for profit side of the organization, responsible for (1) creating an urban market in which to sell these products (thus providing a sustainable financial incentive to farmers) and (2)generating income to sustain THAIHOF's activities.

FON is both a wholesaler and retailer. The market for wholesale, which accounts for 60 percent of FONs sales, is other distributors, including several large retailers: supermarkets, drug stores, and hospitals.

The other forty percent of sales is generated through retail outlets including a store in Bangkok, public exhibitions, mail order, and the mobile sale of herbal products. The latter is an innovative proactive push to bring the product to the customers. Each month, the mobile sales force sells products, as well as holds exhibitions, on-site at five permanent, and two temporary, corporate offices throughout Bangkok.

How It's Working

• Farmers from Kudchum formed the "ruk Thammachat" group – nature care and conservation group – which ran its own rice mill. When the mill started operations in August 1991, the member-farmers received an average of $6.70 per metric ton for their pesticide-free rice – above the market rate for normally produced rice. By 1999, 61 households were producing 100 percent organic rice along with other chemical-free crops. Fifty-five of these same households produce organic herbs and sells them to Friends of Nature.
• FON products are now a name brand and can be found in green shops around the country, including the King's sustainable agriculture outlet "Lemon Farm," and the well-known Thai retailer Lemon Green. The products are also sold in general stores and drug stores, as well as bought by and used in hospitals. FON obtained some of these large clients through proactive recruiting; others came to FON as its product brand gained larger recognition.
• In 1998, FON earned 10 million Baht; in 1999, it earned 6 million Baht (the decline due to the Asian financial crisis, and the increase in competition.) The profit earned in 1998 and 1999 paid the salaries of the 15 employees and contributed 10 percent of THAIHOF's budget. Tositrakul believes that in spite of the decrease in profits due to the financial crisis and increase in competition, in the next 10 years, the profit from FON will fund 100 percent of THAIHOF's budget.

  Her confidence comes on two fronts. The first is that FON is constantly engaging in market analysis to develop new products based on customers demands. This increases client loyalty. Secondly, FON is launching new mass media campaign, generating press in magazines and newspapers, bringing more people to the store. Already, sales from January 2000 are showing a small increase above the monthly average of 1999 – demonstrating a return to the profitable 1998 sales level.

• The sale of herbal products, as well as the marketing channels used to bring customers to FONs products has generated a continuous stream of interest in both holistic medicine and THAIHOF's activities. The constant stream of people coming to the store or visiting the mobile sale of herbal products lends itself to greater visibility, of the issue and the organization. Customers come for a product, and stay for exhibitions.

  Through these individuals, THAIHOF is developing a membership base. This membership base has contributed to the following: 743 newsletter subscribers; 1000 participants in monthly workshops and discussion; 1,123 participants of training courses. The support of this group is giving the organization a new base for local fundraising.

Lessons Learned

• Separation of for profit and non profit arms is critical. TMSR found that the separation of its for profit and non profit operations was the most strategic decision. Primarily, operating both arms under the same administration would lend itself to financial ease. It should be noted that many citizen sector organizations prefer to operate the two together, as the financial systems will become more efficient. However, the clarity of separation assists in separating profits from donations, and other potential confusions. Many staff members felt that generating a profit was a "sin," and would detract from the social obligation of the organization. The best resolution was to divide the staff and the separate entities.

• Maximize profits and sustainability through wholesale and retail. The diversity of wholesale and retail provides a good degree of sustainability for the organization. This is due to the fact that profit comes from a variety of sources, and FON is not overly dependent on any particular customer or distributor for its well-being.

• Increase visibility by reaching out to consumer markets through a variety of vehicles. TMSR believes that their success is heightened by the synergies between their various operations. For example, the Mobile Sale of Herbal Products not only generates income, it also educates the public. This helps build the interests from customers – with this interest many customers are becoming "members" of the organization and increasing their participation by making financial donations.

• Keep products competitive through market analysis and product development. In 1998 and 1999, the profits of FON suffered from both the financial crisis and the increase in competition. While the effects of the financial crisis are repairing themselves, the organization is proactively moving forward to assess its customers needs. Through this analysis, FON is improving its product line with new items, such as cosmetics.