Hi All, out of interest is there anyone here who has an entrepreneurial spirit and gone into business in the Philippines? If so what are your thoughts on the subject?
There is a maxim that says "If you want to make a small fortune in the Phillipines then you need to start with a large one" Small to medium activities are fraught with the unknown and graft and opportunities for extortion big, then there is The anti-dummy laws the reserved occupation laws and of course you cant own real property except condo,s. Folk regularly report loosing money on Sari-sari,s Piggery,s Chicken farms Rice farms Jeepnies Bars and Resturants Investments in Rural Banks Loan Shark schemes Internet Cafes Property Deals being the most common I did have a go back in 08 with English for Japanese and Cebuano for expats but concluded concluded it was probably better to stick with voluntary beer testing
I'm not sure how entrepreneurial beer testing is Keith but ... I had heard the maxim btw and that was one of the reasons for the question, to actually see if there are any success stories. By success I don't mean massive turnover I mean anything experience wise anybody has done or wishes to share regardless of how small the initial investment. My experience of PI comes in two week stints but I did meet an Italian guy out there who had hired a few Koreans to do a bit of Web Development on his behalf. The Italian just brought the work in (from predominantly Italian customers). Small stuff, $500 contracts which doesn't sound much but a few or more of them a month and the low cost of employment made it viable.
I guess if what you do can be done anywhere ie net work wouldnt make much difference beyond that a can of worms if you suceed your a target for payoffs or worse
Halo Halo. I dont have any real idea on this. But I have been reading about a Brit who has a successful business in Luzon making shoes. I do know people running succesful businesses in the Philippines but owned by Filipinos but am sure Keith will tell you that that makes all the difference. In the meantime have a look at this video for inspiration.
You never really own a Condo only a 50 year lease and as that lease ages, I would think does the value of the property will decrease as you have less to sell. There is a law that says these tower blocks have a lifetime of 50 years although I suspect that will turn into a renovation order after 50 years.
HaloHalo I will reply in more detail later on, I have no personal experience of failed business other than a failed sari-sari, but I knew that even before I paid for it as I could see the margins were completely hopeless for the volume of work required, sari sari can work if you can supply a lot of beer as beer has reasonable margins but the profit is still crap. I had reasons relating to keeping idle hands busy which is why I went ahead knowing it would never make money. I know two people who ran successful businesses out there, one a Frenchman who started a software development outsourcing business 14 years ago and my pal who ran a printed circuit board design outsourcing business over there, both businesses are still operating and turning a profit, both were started from scratch with some UK investment. The sons of two of my friends have now also started a web design and software development business and have already got some very high profile clients like McDonalds and the likes. So it can be done but to be honest it needs to be something that the entrepreneur understands pretty well and it helps if they have the same kind of business acumen that is required anywhere, one thing is for sure if you can't run a business in the UK it certainly won't be easier over there where you don't even know the local rules (I don't mean you personally btw).
I know several non-Filipino people running successful businesses in the Philippines. What they have in common are: 1. They are businesses which are export related, either in terms of services or in terms of manufacturing, rather than selling to the local market. 2. They are specialised and offer something that either cannot be had, locally, or which would not be trusted if purely local. 3. They are run by people who have an exceptional level of self discipline and a high level of determination. 4. They all cultivate smooth interpersonal relationships, take care of their staff, and keep on good terms with local interests. A software development business making 3-D visualisations, using gaming technology, for the mining industry. An insurance agency A training centre (this is a reserved list activity so there is a local partner)
Thats interesting as one of the things my previous employer did was / is exactly that for the oil and gas industry, probably for the same kind of reason.
My wifes uncle manages a large chicken farm for his employer. I believe it does well but they are Pinoys and have it all sewn up. Also a crocodile farm
Water, everyone needs drinking water think about it. lease some land dig a well, build a building, get some filter stuff, hire a driver to deliver the water. Easy eh, not
Of course there is always the risk of someone taking umbrage or just jealous of other people's success, and report you to the police with some spurious claim of wrongdoing. By the time you try to clear yourself, you will be poor, destitute, in poor health, family in tatters and could have spent years in remand without having had your day in court to prove your innocence........... Ring any bells....???
Join your local Chamber of Commerce. Join the local Rotary Club. Join all the local organisations that are somewhat similar. Join the Golf Club. Pay your subs and never ever make waves, but always be hail fellow well met. Always show respect to the honourable men in power. Engage a respected accountant and a good lawyer. Employ an HR manager (this will usually be a lady) and be very sure that all staff matters are dealt with by/through her. Pay your taxes. You may think I am joking: I am not. This is the way to stay in business in the Philippines.
Those points are based on observation of successful British businessmen in the Philippines, over 30 years. The reason for joining the Chamber of Commerce and the Rotary Club, etc., is to be sure that you are known and liked by as many people as possible whilst keeping out of politics. Keep in mind that in the Philippines, Banks are for putting money in, not for borrowing from, and that you need to keep a cash float available at all times. The employment regulations are actually quite onerous if you employ permanent staff (which is why companies like SM don't - they fire their people after six months "probation") and you need an HR manager to keep on top of the regulations and also to keep staff working correctly.
Does business in the Philippines, for foreigners, work any differently to some other similar countries around the globe?
Methersgate, paying taxes does not end there. Being hounded by the BIR and paying more than you should + bribe is the way to go in businesses here in the Philippines. We have a business here in Manila for 27 years now and every year, the BIR has been coughing up millions of pesos that we need to pay because of this and that even if we have filled and declared everything. My mother is a naturalized Filipino citizen while my father is an ACR holder and they started the business during the late 80's and it's been goign pretty strong these past few years. Me and my other sibling are now on the biz helping out. It's tough to say what makes a business click or not but a lot of it is luck and wit, making sound decisions and being "madiskarte" or knowing how to go about certain things. There are a lot of intrigues, heartaches, even lawsuits if you are not lucky.
