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CAPT. ARTHUR NIETES

Butuan City

AB to Master Mariner, 1982-present

Owner, D’Arthur’s chain of businesses, Butuan City

Discover and Follow Your Customer’s Needs

By J. Dela Torre

nietesIf somebody had told me earlier that Capt. Arturo Nietes had gone through the rough and tumble of childhood and grew up in a rural community accessible only after a 3-hour boat ride, I wouldn’t have believed him. Captain Nietes or Art didn’t have the look, attitude or mannerisms of someone who was born and grew up in a tough and poor community in the mountains of Butuan. His skin was fine and fair, he spoke slowly and deliberately and he had a gentle way about him, which people of high education, intelligence and fine breeding usually exude. If I didn’t know better, I would’ve regarded him as a mestizo. So much for first impressions.

We were seated in his barbershop, which was the first of the many businesses he has founded since he started his career as a seafarer. The hair salon, bakery, eatery and glass and aluminum supply shop were all located cheek-and-jowl to each other right smack in front of St Joseph Institute of Technology (SJIT), where Capt. Nietes graduated with a degree in BS Maritime Technology.

“I was born in Florida, a remote barangay of Butuan City, along the Agusan River,” he began his narrative, his eyes sad and discerning “The main source of livelihood of my father was to watch out for logs floating down the Agusan River which had gotten loose from its holding ponds, capturing it and selling it downriver to traders.” I was taken aback by the fact that there were people who had this kind of occupation. I knew that in the 1970s logging was big in Agusan, and hundreds of thousands depended on logging and the processing of logs for their livelihood. But I couldn’t imagine a more dangerous occupation—lassoing a loose piece of log weighing 5 tons or more and pushing or pulling it ashore for selling later. This is what Art grew up with and therefore at an early age, he had resolved to get out of the rut of poverty and achieve financial independence through business.

“I looked around at our neighbors and I saw how miserable their lives were, how they were in worse ways than we were. Clearly, I needed to take myself out of there and seek my fortune elsewhere. I promised myself that if I succeed in business someday, I will create as much employment as I could.” Not more than 20 years later, he had achieved his goal.

He saw education as his escape route, and so, no matter how daunting the idea of going to a faraway school was, he endured it. Since there were no roads, and no road transportation, he walked 5 kilometers and back, every day for six years. High school offered a slight relief. The now-defunct Nasipit Lumber Co. offered free transportation for students to the high school building in Tungao, but to get to where the bus parked, he still had to hike for kilometers and cross the river, which was often swollen and therefore dangerous to cross. But Art stoically faced this challenge every day until he graduated from high school. To prevent wear and tear of his slippers, he carried a lunchbox with him to spare himself the long walk home for the midday meal.

College was an issue because coming from a large family, his parents couldn’t get all them in school at the same time. Art was hustled off to a distant relative, who committed to send him through trade school. But Art had set his sights on something higher and better for himself. On the second semester of his first year in trade school, he decided to apply for a working student scholarship at St. Joseph Institute of Technology. He thanked his lucky stars he was taken in, and this was to be the start of a string of lucky breaks which have brought him to where he is now. Though he worked as a janitor, he enjoyed free tuition and free board and lodging. He persevered until three years later, he completed the theoretical portion of his BSMT degree. He was one step closer to a seaman’s career.

But this was one chasm too deep and too wide to cross in 1983. There were no cadet scholarships on offer then, no prominent principals offering free cadetships on board ocean-going ships for poor and intelligent boys looking to a long-term career with the same companies. BSMT students who have completed their 3-year theoreticals had to fend for themselves, and seek their fortune in Manila.

Art had thought long and hard about what he would do when his time came to look for a cadetship opportunity. His idea was to cut out an advertisement of a manning agency based in Manila and set his sail towards this direction, and this direction only.

On the day that he set foot in Manila, he went looking for the name and the address indicated in the newspaper ad, and he found Capt. Cesar Carandang, President of Filipino Association of Mariners’ Employment, and vice-president of a manning agency. Having passed the exam, he started work as utility man for the manning agency office. After only two months, he boarded his first ship as apprentice in October 1981, working as a mess man. Six months after finishing his practical, he aced his exam for third mate. But unsure whether he already had what it took to be a Third Officer, he volunteered to work as AB first and this went on for another year. It was not until 1998, when he was already a Second Officer, that he established his first business in Butuan, the barbershop. He had saved P150,000 at that time, which he used to purchased 5 barber’s chairs at P10,000 each, plus the usual fixtures and supplies in a barbershop, like mirrors, hair dryers, cabinets and barbers’ paraphernalia.

Why a barbershop?

“Well, it’s not too capital-intensive, and all you need to be concerned about is the quality of the skill of the barbers and their work attitude. When you have this squared away, a barbershop is a good reliable source of income,” Art explained.

But Art was not satisfied. It dawned on him that a barbershop business was too passive—the owner just sat there and made sure there was enough change in the till.

One day, a customer asked for something to drink, and that gave Art an idea. He had to buy the drink from a store nearby but the customer’s request germinated in Art what later would become his business philosophy: discover what the customer needs, even before he knew it, and act to serve it. His string of business therefore began from that customer’s need to quench his thirst, and the rest followed. From the need for a drink came the need for snacks and meals, thus the eatery and restaurant. Because he served lomi, a heavy soup with thick noodles, eggs, pork slices and vegetables, bread needed to be served too, because these two always go together, like dinuguan (pork blood stew) and puto (rice cake), thus the bakery. Because there was a barbershop for men, the wives and girlfriends couldn’t just wait while their partners were having a haircut—a facility for women needed to be put up, too, thus, the hair salon. From the need to protect the food items he was selling, he had to have a showcase constructed, thus his glass and aluminum supply business.

What Art didn’t mention but which I’m sure he always had in mind was that customers in barbershops and hair salons—being in a place dedicated to making them feel comfortable and good about themselves—always had this feeling of being on top of the world and wanting everything served to them—food, drinks and business ideas. The barbershop is not just where one collects barber’s tales: it is also where viable business ideas simmer.

And so, this was how his career unfolded. He’d spent months on sea, save every penny while on board, and at the end of each contract, look for a business to invest in. He was conscious of the fact that his career as a seaman was not permanent, and that he had to make sure that upon retirement, he had businesses which could sustain their lifestyle.

The temporary and precarious nature of his profession was impressed upon Art by two incidents in his career.

The first was when they discovered three African stowaways in the ship’s cargo hold. The stowaways had spirited themselves into the ship while the latter’s cargo of rice from China was being unloaded into the port of Abidjan in Ivory Coast. They had hidden in the cargo hold during the day and raided the lifeboats for its food provisions in the evening, and when they had exhausted this source, they made forays into the ship’s kitchen and the crew’s cabins to look for leftovers. They knew their way around the ship because they turned out to be jobless seafarers. One was a cook, another a mess man, and the third, an electrician. The alarm was sounded when the guards noticed forms moving in the dark, and when the crew’s accommodations began to smell from the sweating and unwashed bodies of the stowaways.

Since the ship was already three days into its journey to Brazil, the decision was taken to repatriate the stowaways. Art was put in charge of constructing a makeshift lifeboat that would take the stowaways back to the African mainland. He fashioned four empty drums and lashed them to pieces of wood, and constructed some kind of roofing to shield the stowaways from the burning African sun. He loaded the boat with water and food and gave cash to the men. As he lowered the three men into the makeshift lifeboat, he realized how dangerous his job was. What if these were terrorists and had blown themselves or the boat to smithereens? What if they had some virus with them and had infected us upon contact?

I thought about the Ebola epidemic which has killed thousands of people in the very same African region where the stowaways had come from, and I wondered if the government had health protection mechanisms in place to protect our seamen who might find themselves in these affected countries. 

The second incident involved Art himself when he was already Chief Mate. They had come from Europe and was somewhere just outside the English Channel, when the ship sailed smack into foul weather. The ship’s anchor began to bang violently against the hull. Art led a team sent by the Captain to do something about the problem. Upon examination, he realized the only way to stop the banging was to lash the anchor with mooring rope, but to do this, the ship had to turn away from the direction of the weather to enable the team to work on the problem with a minimum of disruption from the gale-force winds. Having done the repair job, his Samoan teammates had headed back to safety and Art was starting to walk back to the bridge when the ship returned to its original course line. As soon as the ship turned, a huge wave crashed on the prow, upending Art like a stuffed doll, and violently smashing his head into the solid-steel forward mast. If he wasn’t wearing a helmet, he would’ve been a goner. If he didn’t have a safety harness on, he would’ve been washed overboard by the receding wave. The captain had miscalculated the timing of the ship’s turn, and had almost ended Art’s seafaring career.

Art was bleeding profusely from the head wound, and the ship’s medical officer, the Second Mate, almost fainted from the sight of so much blood. He was paralyzed and couldn’t apply first aid to Art. Although feeling dizzy, Art was amused at the silliness of the ship’s medical officer being petrified by flowing blood. Not having lost consciousness yet, Art himself issued instructions that he be brought to the ship’s hospital, and still bleeding, sutured his own head wound. He was airlifted to the Azores, the nearest island, and confined in a hospital for seven days. From there, he was flown to Lisbon, where he took a flight home to the Philippines. To this day, he keeps the crushed helmet which saved his life, a constant reminder of the precariousness of his trade.

What are the challenges he faces in his businesses?

“Being all service businesses, the top challenge is always manpower—the quality of manpower, how to control embezzlement or petty theft, how to retain the good ones, how to ensure they follow instructions, and what internal control measures to apply,” quickly came the reply, indicating he had thought long and hard about this issue. Art also looks out for telltale signs of wrongdoing among his employees. Things like when an employee who has a pattern of making cash advances, is no longer asking for a loan or is sporting a new expensive watch or jewelry, or reporting late. Long before the term lifestyle check became popular, Art was already doing it on his employees whom he suspects of anomaly.

The critical importance of being on top of all aspects of business operations was highlighted by Art’s ill-fated venture into the shawarma business. He had timed the acquisition of a shawarma machine from Turkey to the opening of the Gaisano Mall in Butuan. It was a hit, especially when there was a good movie showing, but he couldn’t sustain it.  It was eating too much of his time, and he couldn’t trust anybody else to operate the food stall. He had to wake up as early as 4 am to defrost the marinated meat for the shawarma, and be constantly present at the mall till closing hours.

What other businesses was he planning to go into?

“I think, a gasoline station business would be quite profitable,” he said with a glint in his eye.

He advises potential OFW business operators to take into account that success in business in the service industry depends on the availability of capital and a good location. Capital may be accumulated from savings, and in this regard, the OFW and the family have to be partners in applying the principles and discipline of savings. Finding the right bank to borrow from is also another way of capitalizing one’s business. Find what is needed by the community—whether goods or services.

He also warns OFW entrepreneurs against hiring relatives as employees. Art had learned his lesson the hard way about hiring relatives. He had bagged the contract to operate the canteen of the St. Joseph Institute of Technology, and hired his own nephew to manage the canteen. The nephew managed the canteen well, but he had other things in mind. He engaged in a sideline business which eventually led to the shutdown of the canteen and his conviction and incarceration—pushing prohibited drugs. He was selling drugs to students and using the canteen as cover.

Despite the shame the nephew had brought to the family, the bridge between Art and SJIT was not burned. He was recognized as an outstanding alumnus. 

Art is a 4-time recipient of OWWA’s various loaning windows, and has sunk all the loans into all his businesses.

Now, he employs a total of 38 employees in his various businesses, not counting those he has employed in his failed ventures. He is waiting for his next deployment, hopefully as Captain. That would cap a long and fruitful career as seaman, which he has leveraged to open several business, and which are now paying it forward by creating decent jobs in the community.