Small Business In The Philippines
The Philippines is a good investment location where there is a good guarantee of growth. Proof of it is the exponential increase of franchise businesses of all sizes and the establishment of branches of multinational companies in the country. With the promotion of the Philippines as the new hub for high-technology industries, foreign and local firms are becoming confident in setting up businesses in the country. Setting up a business in the Philippines has the following advantages: Labor cost is low; English language is widely used; it shares cultural affinity with American values; and it has a large pool of qualified, skilled and easily-trainable workers. It is for these main reasons that call centers abound in the country. Small businesses get as much chance to succeed as big conglomerates due to the business-friendly environment the country has successfully created with the continuous improvement of the Philippine currency and the good economic performance for the past three years,. The key is to identify the exact business for you. Finding your niche in such a broad market opportunity is the tricky part of the undertaking but if you get it right, the rewards can be great. The biggest number of small business establishments belongs to retail businesses. The retail industry is considered one of the strong forces of the Philippines economy, accounting for 15 percent of the country's gross domestic product. The Philippine Retailers Association reports that 18 percent of the total workforce is employed in retail establishments. Examples of retail businesses are grocery and convenience stores, school supplies, RTW, and the neighborhood variety store better known as the "sari-sari store". The sari-sari store is by far the most common small business concept as it caters to customers with a limited spending power. The store often offers products in small units, like shampoo and coffee in sachet, at prices that are easy on the pocket.
Direct selling is also quite popular in the Philippines especially to housewives who aim to find ways to augment the family's income. It involves a highly personal communication or marketing strategy in order to sell the products, with the business transaction involving a face-to-face encounter between the seller and the prospective buyer. Examples of successful direct-selling companies in the Philippines are Avon, Tupperware, Natasha, Dakki, Sophie Martin and Sara Lee. Sellers of their products are called dealers. They are not employees of the company but rather considered as independent businessmen who source their product from them and sell it to their customers. Distributing recognized brand names has a good chance for success because of the Filipinos' innate love for imported and branded items. The challenge for small businessmen who want to go into distributorship is the large amount of beginning capital required. This may be solved by seeking for an agreement with the manufacturer to have the products consigned for a definite period of time. One may also opt to try franchising. Franchise fees vary depending on the type and nature of business. It may range from as low as 25 thousand pesos to as high as 75 thousand pesos. Capital requirement may be from 50 thousand to 10 million pesos. A large number of businesses which experienced exponential success are franchises. Whatever business endeavor are you willing to undertake, it is necessary to thoroughly study the market and evaluate the feasibility of the business. The things that have to be considered are: profitability, sustainability and fair return-on-investment. |