Philippines business advice – doing business in the Philippines

If your approaching the Philippines from outside the country to do business then you really need to research Philippines business advice. The first and major hurdle is that as a developing economy and nation its working and business practices are different to most western countries and often seen as counterproductive.

The developing markets for doing business in the Philippines are primarily the internet businesses and the business support industry. The main advantages of operating a business like this in the Philippines is you can keep all your money abroad and only bring in as and when is needed. The Peso is a versatile currency and although myself I have seen it move around 30% in a positive way over the last 3 1/2 years it could just as easily slide the other way. The main stability in the Philippines economy is an estimated 10 million overseas workers sending money home on a regular basis literally in the billions financially.

Operating a small scale online business is an easy way to fund a life in the Philippines if you learn the ropes the internet is a beast that is still evolving and still nowhere near where it will be in even a years time as things change so quickly. For example the launch of Google+ will no doubt be a heavy attack on Facebook which may change the social networking sector literally within months if not overnight when it starts going public.

The thing with the internet though is it takes time as the song goes “a whole lot of precious time” and in reality that’s it but at the same time once its evolving it grows over time and suddenly it may become your main source of income for living in the Philippines full-time.

Do not rely on things that are going to tell you they can get you to jump the ropes e.g. “get 5,000 Twitter followers today” they can get you the followers but what are they worth? in reality probably less than 20 as most are things like computer bots and people following people to just gain more followers. The metrics you should be looking for is the growth of sites naturally and a following. Buying your way in will not improve your sites in fact your probably just going to lose money. Working online takes time and that’s the only thing that will build it.

Things like Odesk and other organisations that offer work are a way to keep afloat and worth a look at but bearing in mind your competing with people all over Asia and other locations that will work for literally coins. But at the same time if you find your natural niche you can find like myself I can knock up an article in around 10 minutes. So even at P100 that’s P600 an hour.

Call centre business may seen like a good idea when coming to the Philippines and lets face it Arroyo on her way out (previous president) was saying how its the Philippines future. But in reality there are some very strange business practices here that could affect your business and has done for many business savvy people that simply gave up and left.

Your employees could file a complaint against you for firing them, you may laugh but I know of a British National who has gone home because of 2 employees that were useless and because they got fired they filed a complaint against him. At the same time you look at the big companies they fire people on a regular basis to get round things like employee rights and social security. Then there are odd things like the 13th month and I believe call centre agents can often get up to 22 months! (What does that mean?? they get up to 22 months salaries a year the 13th month generally comes out around Christmas for an extra bonus). There is a high number of national holidays and 101 other things that as a foreigner doing business here would start to think another country looks more welcoming.

Not trying to put people off but when you start looking at things what brought many call centers here in the first place was the high use of the English language. In reality you have to balance up if everything else makes it worth being here or finding somewhere that is aggressively learning English for the industry that may even throw you some freebies to go there. We haven’t even discussed the issues of internet and power issues in the Philippines which are also major ones on a regular basis. The current discussions going on are regarding looking at throttling the internet service back which for me would be business suicide for a lot of companies as they will simply move. The electricity most of the buildings have their own supplies as backups.

But as a small business owner your not going to have the budget to install your own infrastructure and I do find a lot of the rentals overpriced as well as the infrastructure services also overpriced. At the same time being a small business with a few employees may be a better option and one that would work unnoticed. Why do you want to stay invisible? there are major problems of jealousy with many Filipinos its called “crab mentality” and its even more so with a foreigner succeeding and this is why you may find harassment over your Microsoft Licenses by PNP quickly followed by harassment over permits, fire extinguishers and worse. Personally I would advise keep your business to yourself and low key, the way I look at it is that most people its literally none of they’re business what I am doing. At the same time avoid having business partners that you either don’t know too well or are local, many disputes here are resolved by a gun and at the end of last year I remember one of the biggest hotels here in Cebu seen 2 brothers shot by an uncle trying to take control locally its normal!

Medium or large scale businesses with substantial investment really need to stay inside business parks, it doesn’t come cheap but due to being controlled by central government nationally its out of reach of the local corruption. There may also be some tax incentives for doing so they normally reside in IT parks, economic zones or export processing zones examples :-

Cebu Area –

  • Mactan Export Processing Zone (MEPZ)
  • Mactan Export Processing Zone 2 (MEPZ 2)
  • AsiaTown IT Park
  • Manila – Luzon Area

  • Bataan Export processing Zone
  • Baguio City Export Processing Zone
  • Cavite Export Processing Zone
  • Clark Special Economic Zone
  • Luisita Industrial Park
  • Subic Bay Metropolitan Authority
  • For more information on investing in Cebu please visit Cebu government investment promotions at CebuInvest.com