making money in the Philippines – Look after the coins and the notes will look after themselves

coin_peso_10A reoccurring comment keeps coming up a lot about a lot of things. From kids being taught composting and growing vegetables etc as kids but after they get older are either to lazy or not interested to do it themselves to people having no interest in working because remittances are coming from abroad so if these factors are true and to be honest from Expats I know who have a lot of problems with relatives because they have got used to riding the OFW and foreigner gravy train I think its fair to say in many cases it is that at the same time this is space for opportunity to make money. In expat circles you will hear that “Sari-Sari stores rarely make money”. Truth is they can only lose money by bad management and more being taken in house than is being sold. Filipinos by nature and culture love to eat which means selling daily food supplies there is a constant market that needs supplying. I have yet to meet anyone in the Philippines who does a monthly shop for example most people are buying something daily. This is also partly due to fund restrictions and living hand to mouth. But that is also a reason there is a market for “small ventures” as we are finding with our neighbours currently. There are people a few streets away selling rice by small bag quantities and due to the quantity of neighbours needing rice they are currently out stripping supply and are requesting that my in-laws start selling rice aswell. The reason this happens is that people don’t have the budget to be buying rice by the sack and buying daily supplies. The same is can be said about Chorizo a Philippines native cured sausage meat. 200px-Longanisa The frozen food idea wasn’t originally something I had thought of as I had been busy with other projects but after a chat with a friend of mine Nathan who mentioned a few good ideas it made sense and currently this is the latest thing we have started doing. We are also looking to buy a freezer shortly for “Frozen” Chicken and other meats to supply the local demand that seems to be developing. We wont get rich from it that isn’t the point but its the collecting the coins from all these ventures that will turn a small income into a regular Tiren_u0 development fund for other projects. We are also preparing before the Tilapia in the Aquaponics live chickens to sell locally for meat as there is a culture of “fresh meat” means alive as very few people have ways to store meat so the culture is to keep healthy kill it and eat it. So the chicken venture will be approached from two angles. So what is the point of doing all this if your picking up around P1+ per item sold? In reality you have people that either buy from us or will be having to pay P12 to ride to the market and back. If they are living hand to mouth that P12 is a big saving if having to buy every day or every couple of days as they earn money. In reality we are making a bit of money at the same time as saving them. Even if we buy retail from the market and sold it with a P1 increase on each product. I know some of my friends will be laughing at the fact I am dealing in such small amounts but its the ability to budget into such small amounts that will allow things to grow. People often in the Philippines as “Retirees” end up living a life more inline with the poorer members of society simply because they haven’t done anything while here to stabilise their income for the future. The pension is unlikely to grow but the cost of living will without a doubt. When I first came to Cebu the average salary was around P250 a day that was just over two years ago with an exchange rate of P96 to the £1 now the rate is P350 (average) and an exchange rate of P76 to the £ which is just below the 20% mark and on top of that food prices have increased. If a retiree budgets ahead then suddenly gets sick it can pretty much wipe out the pension completely. You may not think it will happen to you but its always best to prepare for the worst to keep ahead of the game.

I got in a dispute with someone a while back over pigs as he had told me I don’t know what I am talking about as there is little money in pigs. Truth is like he admitted himself he “made a profit” as well on his. But its the cost of the setup as we are generally too quick to assume we are going to make XYZ in the first year. But the fact of the matter is that year one is the learning curve, year one is the year where you spend money until if everything is setup, year one is where things break,don’t work or find you are being over charged for things. In reality if you make money in YEAR ONE your doing well. Now we ran 2 batches over about 8 months we made a profit on both batches but stopped. Why? Because the profit margin as a “Piggery” wasn’t viable because we had a small stock of 30 pigs and I wanted to generate enough income to Support my wife April and Daughter Zoei as well as create a stable income for my parents in law as Aprils mother used to work miles away making clothing and would be out of the house for at least 10 hours a day for a small salary. This is why I gave up the piggery at the time it didn’t pay enough for 4 people to be supported. So when the last batch sold we had around P57,000 so we took it and put it into another business which is now our biggest income I won’t go into too much detail but it does support 6 people and has allowed us to fill in a budget shortage on the first apartments construction after the Net cafe delays and an unexpected extra P80,000 (more than half of the budget for Apartment 1). But the other thing is like I said its all about the coins. The net cafe is now fully functional and the income already covers its own bills and a small salary for Jovie but it will grow. The first apartment is also in its final stages ofIMG_0425 construction before the fitting out starts and the Sari-Sari store is in its early stages but will quickly grow. The one important factor that makes a difference is not stretching the businesses as the early stages are important to its survival and prosperity. We are all living off the one main business at the moment and allowing the smaller ones to move forward in the next couple of months I expect that we already own a couple of freezers, stocks of frozen food and livestock for sale. We wont be doing anything fancy with the live chicken mind as they will be supplied by the egg producers who need to clear out the barns ready for new stock. Basically we will be buying in bulk for quick turnaround rather than fattening them on expensive animal feeds and before someone comments on the meat difference between “
free range” etc. these chickens already sell well which is why we are doing it. Once the stocks are selling the next stage is getting apartment 2 completed before December. The end result will be steady incomes from multiple enterprises. But at the same time not absorbing too much time to stop us progressing with new ones. Aprils mum already has an idea for a new venture which was joked about tonight. Not because the idea was funny but April and Jovie are more concerned about what we have right now as simply our man power and budget is split in so many directions its time to pull in the reigns and sit for a while. Same reason I have stopped going out recently to keep our budget down as the net cafe hammered us a bit on top of the bad debts we received. Bit of a reality to check but now the wheels have started to slowly turn again we are all going in the right direction and no doubt will see the rewards by the end of the year in time for the Christmas party..