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The Money Business in the Philippines

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Upon reading the title of this article, what automatically came to your mind?

A 5-6 business? For those who don’t know it yet, 5-6 refers to the art and science of lending money to someone for 30 days — plus or minus 5 days — at 20% interest. If you do the Math, that means in a span of 5 months you double your money.

Wanna try? Oh, no… not so fast. Perhaps I should warn you first that it is a very risky proposition that you better leave it up to your friendly neighborhood Bombays, who are the true masters at that business.

And oh, by the way, contrary to popular belief, 5-6 won’t get you cancer. But not getting your money back, probably would. Hmm… Don’t tell me I didn’t warn you.

How about Lotto? We’ve already shown you that it is one of the ways you can get rich here in this country. On top of that, through the PCSO, you are also helping your fellow countrymen who are in dire need of money.

Time deposit, perhaps? It offers a lousy return, but at least your money is a little safer at the bank.

If you are thinking along those lines, I guess you already know that money can be used to make money.

3 Ways You Can Make Money From Money

There are many ways to go about this, but for this article, we’ll focus on three money businesses that you can set up on your own or with your business partners. They are the following:

  1. Pawnshop
  2. Money Remittance
  3. Micro-finance institution (MFI)

“The quickest way to double your money is to fold it in half and put it in your back pocket.” –Will Rogers

Pawnshop Business

The Pawnshop Business is as old as mankind itself. And in the Philippines they are all over the place – from the remote parts of the provinces to the most crowded corners in the cities. For many Filipinos, a pawnshop is one place they can rely on as a source of quick money normally used for emergencies or immediate needs. That is, given the right collateral (something of value) the pawnbroker (the company or the individual running the pawnshop business) lends them money for a set period of time and for a given interest. The beauty of this process is that it is very fast, with no complicated document requirements like you would encounter when applying for a loan from a bank.

On the business side, there are three ways a pawnshop makes money:

  1. From service charges.
  2. From interest charges.
  3. From the sale of unredeemed items that served as collateral for the loaned money.

But remember that the real business of pawnshops is from the two items aforementioned. As Jean Henri Lhuillier (from the Cebuana Lhuillier Pawnshop Companies) said in one of this his interviews with the Inquirer, “Our business is out there as a bridge financing service. We are not into the business of buying. We are in the business of lending.”

Money Remittance Business

Money Transfer to the Philippines

Money Transfer to the Philippines

In the Global Money Transfer scene, the Philippines is the third largest country that sends money back home from abroad. The first two spots are taken by India and Mexico. Data from the Bangko Sentral Ng Pilipinas (BSP) shows that the average amount sent by an overseas Filipino to his family in the Philippines is 300 USD per month. Last year alone, the total money sent to the Philippines from abroad reached 20 Billion USD.

That’s a lot of money. And some say, they help keep the Philippine economy afloat and made the Peso Currency strong against the US Dollar. No wonder, the Overseas Filipino Workers are considered as heroes of the nation.

The Money Remittance Market in the Philippines used to be dominated by commercial banks. But thanks to the improving telecommunications technology, smaller players are now competing with the banks offering lower service charges and reaching wider areas of coverage.

(See also: Send and receive money using Paypal in the Philippines.)

If you wish to run a money transfer business, keep in mind the following:

  • You are required to register with the Bangko Sentral Ng Pilipinas (BSP), for local money transfers.
  • If you have an operation in another country, requirements differ from one country to another. Usually you will be required to place a cash bond and present your operating manual.
  • It is important that you are aware of our local Anti-Money Laundering Law or similar laws if you have branches abroad.
  • Equipping your premises with security systems, CCTV and alarms would be of help.
  • Important to setup a continuity plan in case the computerized system goes offline.

A money remittance business has two ways of earning money:

  • Service charge when someone sends money.
  • Foreign exchange when a foreign currency is converted to the local currency when money is claimed.

Microfinance Institution

The concept of microfinance is nothing new. But it became really popular with the success of Grameen Bank in Bangladesh.

For an overview of Microfinance, take a look at this inspiring short video presenting Dr Muhammad Yunus, known as the banker to the poor.

You may also want to buy Dr Yunus’ book, “Banker To The Poor: Micro-Lending and the Battle Against World Poverty”, from Amazon by clicking on the image below.

In the Philippines, no less than Bangko Sentral Ng Pilipinas has “declared microfinance as its flagship program for poverty alleviation.” The BSP defined microfinance this way:

Microfinance is the provision of a broad range of financial services such as deposits, loans, payment services, money transfers and insurance products to the poor and low-income households and their microenterprises. By definition, it is important to note that Microfinance is NOT subsidized credit, NOT a dole-out, NOT salary or consumption loans, and a cure-all for poverty.

The entrepreneurial poor

We all know them. They are the hardworking mom-and-pop (and perhaps kids, too) vendors in the local market. They are the sari-sari store owners serving the community in your subdivision. They are the small-time farmers raising poultry and other animals in their backyard in some remote countryside. Their original sin: They are deemed too risky by the banks to able to deserve a business loan.

Well, I hope you already get the picture of who I am referring to.

Essentially, microfinance is meant to help fund the entrepreneurial and business ventures of these poor entrepreneurs. According to the BSP, “If provided on a sustainable basis, microfinance can help increase income, build viable businesses, reduce vulnerability to external shocks, empower the client, and improve the quality of their lives.”

(Related article: How to fund a startup.)

How to setup a Microfinance Venture in the Philippines

Quite ironically, microfinance services are already available in some rural and thrift banks. These are smaller banks usually serving the countryside. Savings and Credit Cooperatives are also among the most active providers micro-financial services.

So, if you are planning to setup this kind of venture, you can either form a bank or a cooperative.

How To Start An Oil Business in the Philippines (Opportunities from the Big 3)

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As a developing country, the Philippines is known as a major consumer of energy-related products such as gasoline and diesel and yet we only produce a fraction of our own, which is really not enough for domestic consumption. That is why we rely so much on imported petroleum products to help us power our growing industries and population. And like food, fuel is one commodity that man (his machines, to be precise) can’t live without — or so it seems.

For a long period of the Oil Business in the Philippines was dominated (some say monopolized) by companies collectively known as the Big 3 — Caltex, Petron and The Pilipinas Shell. Thanks to the Oil Deregulation Law ( Republic Act No. 8479 of 1998 ), some smaller and independent players have emerged bringing benefits to the consumers, serving farther locations in the countryside and more opportunities for those who want to be in business.

Do you want to know how you can take advantage of the various business opportunities in our local Fuel Industry? You have come to the right place. More specifically, we’ll show you how you can become a distributor of well-known brands of the country’s three biggest oil companies.

What’s In Store For You, The Businessman

For smaller businesses, running their own petroleum business basically means becoming a franchisee of a known company or becoming a retailer. Either way, you will be carrying the trade name of the mother company, you will be sourcing majority of the products from them and you will have their support, too. Different companies will also have their respective business opportunities which you can choose from, but basically they fall under the following categories:

  • Gas Station (includes gasoline, diesel, motor oils, lubes and lubricants, etc )
  • Gas Station plus Convenience Store
  • Gas Station plus Automotive Shop (plus, maybe, a car wash)

Obviously, petroleum is your main product.

Opportunity #1: A Caltex Gas Station

The Caltex brand is backed by Chevron Corporation, which one of the global leaders in the energy industry.

For a minimum investment of P 5M for facilities and equipment, you can become an oil retailer of Caltex. Of course, you will need to set aside an amount for your initial operations.

Running a your own Caltex Gas Station as a retailer of Caltex Products means you are in partnership with a trusted and highly recognized brand.

Here are some of the advantages of being a Caltex Retailer:

  • Caltex will appoint a Business Consultant who will help and support your venture.
  • Chevron Engineers will be available for consultation of your initial site design and construction
  • Trainings are available to help you enhance your business skills as a retailer.
  • Marketing and other support services.
  • Business Signages will be provided by the company.

How To Become A Caltex Retailer

You need to submit an application with your site and the company will contact your for their initial evaluation.

Here are the steps to take:

How To Become A Caltex Retailer

For more information, visit their website at http://www.caltexforinvestors.com.

Opportunity #2: A Petron Service Station

The Petron Corporation is the country’s big daddy in the energy sector. It supplies nearly 40% of our nationwide fuel consumption. And it also owns an oil refinery plant which processes crude oil and turn it into various petroleum products which can be distributed to the service stations and used by the end consumers.

On the business side, Petron offers the following opportunities that you can tap:

  • Run a gas station.
  • Distribute LPG. In some cases you can also carry this product line in your gas station.
  • Own an Automotive Service Shop under the Petron Car Care Center brand.

Let’s focus on the first one.

For those interested in distributing Petron products, there are basically three types of Petron Gas Service Stations available:

  1. Company-Owned Service Station
  2. Dealer-Owned Service Station
  3. Micro Filling Stations aka Petron Bulilit Station (perfect for micro-entrepreneurs)

Petron Bulilit Gas Station

A Petron Bulilit Gas Station. This one is perfect for micro-entrepreneurs in the Philippines. It is best to set this up in the under-served areas in the countryside.

They are all basically the same, but they differ on the size of the station, the investment requirements and the number of pumps (maximum of three pumps for the Petron Bulilit Station).

The capital requirement ranges from P 1M to P 9M depending on the size of the service station. To become a dealer, you have to undergo a three-phase selection process which consists of: Screening, then Training, and finally Project Implementation Phase.

For more information, please visit the Petron Corporation’s website at petron.com.

Opportunity #3: Pilipinas Shell Retailer (A Franchise Business)

Pilipinas Shell Petroleum Corporation “refines, blends, transports and sells a wide range of high quality fuels, lubricants, bitumen and other specialty oil-based products.”

As a Shell Retailer, you will be operating under the trade name of Shell. This gives you the opportunity to use the company’s logos, trademarks, signages and other Shell-related symbols that are easily recognized worldwide.

Well, actually Shell offers a franchise opportunity with a twist: there is no franchise fee. However, just like any franchise operation, you will have to pay a royalty fee and retailer’s fee every month. The initial investment at the time of this writing ranges from P 3M to P 5M and covers the fuel supplies, station equipment and other things related to the operation of the business.

(See also: 5 Factors to consider when buying a franchise.)

How about the convenience store and other business opportunities from Shell?

Good question. If you happen to notice, some Shell Petrol Stations have a Convenience Store (under the Select brand), or Automotive Service Shop. As a Shell Station Franchisees you will have to apply for those separately.

Furthermore, Pilipinas Shell is proud to declare that dealers can expect an average Return On Investment of 30% to 40% with an average pay back period of 2 to 3 years.

For more details on the Shell Franchise Opportunity, please visit their website at www.shell.com.ph.

Other Business Opportunities From Small Players

Up next, we’ll be showing you the other dealership and franchise opportunities from smaller oil companies like SeaOil, Phoenix Petroleum, FlyingV. You may be amazed to discover that it really doesn’t take that much capital to put up a gas station carrying the brands, products and services from these companies.

Buying A Franchise Business? Look Before You Leap

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In a nutshell, franchising is a business model that allows the franchisee to sell the products or services of the franchisor (the parent company). It is an easy doorway to entrepreneurship for anyone who wants to take a short-cut and minimize the risks involved in creating and running a business from scratch.

The following are some of the attractive aspects of operating a franchise business:

  • The use of company trademark, trade name or any other similar company identification.
  • Training Programs
  • Marketing and Advertising Assistance

Sounds good enough for you?

Well, as with everything else in business, franchising is not without its problems. There are a lot of jerks in the world of franchising. You may have already heard of “success stories” of franchise companies that started small and have grown by leaps and bounds in a matter of two years! On the surface, that’s indeed very impressive especially if the story is masterfully crafted by the media whose main job is to attract as much attention from a lot of viewers as possible. But, did you ever wonder where the money came from? Was it a result of offering a set profitable products and services? Or, was the “success money” extracted from franchise fees? As a potential franchisee, it’s important that you have to know the real score. Otherwise, you might just become their rich source of cash.

The rest of the article provides practical tips you can use before you buy a franchise business.

1. Check The Company’s Background and Track Record

Tips In Buying A Franchise

Buying A Franchise?

First, it would be good if like the company, its management and the way they conduct their business operations. Ideally, you should have patronized their products and services for a long time already.

Avoid buying franchise from a company that is relatively new in the market — less than five years. You may seem to like their products and the services they offer, but you can’t tell if they are really profitable or they are losing if they just launched their business.

There are only two reasons why businesses survive: (a) they are profitable, or (b) the owners have deep pockets. Common sense dictates that the former is your best bet. You have to be convinced of their track record of success in the marketplace. Otherwise, you might just become their cash cow.

2. Know The Money Involved

At the very least, you need to determine the following:

  • Franchise Fee / Renewal Fee
  • Estimated Capital Outlay
  • Royalty Fees
  • Advertising Fees
  • Estimated Operating Expenses

Beware of the hidden costs and fees that are not clearly spelled out such as the Renewal Fee. You can never find such information from the company’s marketing and promotional materials. You have to be creative in figuring this one out.

Furthermore, there is no point in buying a franchise you can’t afford. And speaking of affordability, you have to check if financing is available. Can you obtain a business loan? Will they extend help in getting a loan?

(See also: How To Fund A Start-up.)

3. Look At Their Earnings Claim

Is it too good to be true? Do you know the average industry standard? If you can have a copy of their audited Financial Statements, that’s good. It’s one way to verify their claims. But I doubt it if they will share such information. This is where your personal research comes in. You have to compare them from the competition, whether those are franchised operations or independent businesses.

Naturally, you want to avoid dealing with outright liars, cheaters and scammers.

4. Talk To Other Franchisees

Remember we talked about hidden fees and avoiding scammers? This is one of the ways to uncover them.

The franchisor should be able to give you list of company owned outlets and as well as franchisees. One of the smartest moves you can take is to personally visit the stores and possibly talk with the franchisees.

5. Obtain A Written Proposal, Sample Contract, Franchise Agreement

Read it carefully. This simple document speaks a lot about the company you are dealing with. Can you spot typos and grammatical errors? Does the proposal even make sense to you?

And most importantly, can you terminate the franchise agreement? In what instances and how much will it cost?

It helps if you consider the help of a lawyer or accountant who is familiar with our local Business or Franchise Laws. But you can do that later when you are already convinced about the business.

Deal Or No Deal?

When it comes to franchise opportunities in the Philippines, you have a lot to choose from. But you have to watch out for the bad apples that could be lurking somewhere and ready to take you for a ride.

There is nothing to rush. You must be in a position to say “No Deal” if you smell something fishy. Always read the fine print and use your common sense.

Your Business Website: How To Do It Right (Part 2 of 2)

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In the previous article on this series, I mentioned about some of the benefits your business can derive by having a website. You can reap those benefits if you know how to do it right.

However, not all entrepreneurs are technology savvy. Some of them have only a basic understanding of the Internet technology and how to take advantage of this. If you belong to this group, you need not worry. This website is created for business owners just like you who want to learn how to utilize the Internet and related technologies and who don’t want to be bothered by the lesser important details.

It’s true that technology is getting more and more complicated as it advances forward. On the other hand, companies that offer high-tech products and services to their clients are also striving to make it as simple to use and possible for users to be able to adopt and take full advantage of the features and benefits. I’m not sure if you have observed it, but most tech products that thrive in the marketplace are those that are also the most user-friendly even your non-techie grandma can use. Building a basic website is about the same: it’s becoming simpler than ever. Given the right tools and with proper guidance, you can be up to speed in no time.

I believe that there are only three primary skills you need to have for you to be able to utilize these Internet-related technologies into your business. These skills are the following:

  1. Using Email.
  2. Using Desktop Applications.
  3. Ability to Read English.

That’s it. Once you have developed those skills, you are in a position to follow what we are about to show you here. That is, how to develop your business website and how to do it right.

Note: You don’t have to do the actual website building yourself. You can hire other professionals to do it for you or you can buy those off-the-shelf packages. I believe that as a business owner, you should only focus on the core competencies of your business, and leave the nitty-gritty stuff to other people.

So ready? Read the rest of the topic.

What You Need To Get Started

The first two items are a little bit technical, but they are easy to understand. It’s important to remember that you should be the one to buy, control and manage these two important resources. We’ll have more of that in other articles, but right now you all you need is a short introduction to know what they are. The third item is the simplest and easiest to understand.

1. A domain name. It’s the one that appears on the Browser’s Address box as http://www.yourdomain.com. This is your online identity, your address in cyberspace, your single most important online resource.

It’s your name. How good does it sound?

Like your business name, your domain name should also be sticky: Easy to remember and hard to forget.

2. A Web Hosting Account. Remember disk drives, USD flash drive and DVDs? They are digital devices that you primarily use to store files. A web hosting account is a lot like those file storage devices, but it’s actually a whole lot of package which includes, a database server, web server, lot of software, and more. You access it over the Internet and located in a place called the data center, which your web host provider maintains. When it comes to web hosting, you need to get it from a reliable company. You can’t afford a down time.

3. Text, Graphics, Audios and Videos. From your visitors’ point of view, these are the stuff that they see, read or hear. Once assembled together, it’s the doorway to your online business. It’s your chance to make an impression. Make every page count.

Web Pages That Count

Business Website Guide

Your Online Business: Do It Right The First Time

Your actual website should contain as many text and informative articles as possible. But for a start, the following pages should be considered as essential:

  • Home Page – When people visit you from your URL, say www.yourbusiness.com, the home page is very page that they see. Otherwise called as the main page, it should provide links to the most important pages on the website.
  • About – This section should have the essential info about your business or your organization. Highlight the following: Company Background and History, Management Team, Vision and Mission Statement, etc.
  • Products And Services – What do you have to offer? Put them here and make this module very accessible from the main navigation.
  • Contact – Put your contact information here. Email Address or Contact Form, Physical Office Address with Map, Phone and Fax numbers are among the most important information visitors will be looking for.
  • Blog – Blogging is not just for kids who are ranting about everything there is to rant. It’s an effective way of giving your faceless company some form of personality. Here’s a two-way communication medium between you and the customer.

Common Sense Web Design Tips

In closing, I’d like to share two timeless web design tips that you can implement anytime.

First, keep it simple. Make it easy for your visitors to navigate your contents. The website is not a showcase of the graphical abilities of the designer. It is a means of delivering your message across. Your important pages should be accessible from any page of your website. Remember to put your audience first. Give them what they are looking. Your website is not for you to visit every day. It’s for your visitors so they can do business with you. Observe that the most popular websites also have the simplest designs.

Finally, make it fast. Avoid fancy graphics and flash animations like you would a contagious disease. I know and I regret it that most website owners love to have kinds of flashy stuff. Do you really think your visitors are there on your website so they can be entertained by your flash animations and to watch your photos? Think about it.

Your Business Website: How To Do It Right (Part 1 of 2)

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During the Internet Boom one of the most hard-to-forget marketing pitches I’ve ever come across went like this: “If your business is not in the Internet, your business will soon be out of business.” The message, of course, is over-exaggerated, but it is an invitation for businesses to go online and claim their respective spot in virtual space by putting up a website. Essentially, the message is saying, “get your website now before the competitor gets there first.”

build a website or online business

Building a website can be fun.

Here’s my take: The part where it says, “being out of business if you’re not online”, that’s not true at all. From the period covering of the dot-coms-turned-dot-gones to the when everyone was talking about Web 2.0 (whatever that means) and until now when mobile apps are the “in things”, there are businesses which never had an online presence. Quite surprisingly here in the Philippines, a good number of these businesses are doing just fine and some are remarkably thriving even without having their own websites. What I’m trying to say is, if you are a business owner, you don’t have to jump to the Internet-bandwagon. In fact you should NOT get a website under the following circumstances:

  1. If it’s not essential to the operations of your business
  2. If it can’t bring in the money to your business.
  3. If you can’t do it right.

I can’t help you with the first item. You have to figure it out for yourself.

NegosyoBuilder.com is here to help you with the second item. So I’d like to invite you to subscribe to our email list (thanks to Google Feedburner) or like us on Facebook or connect with us on Google+.

This article is intended to address the third item. When it comes to your online business, your attitude should be: “Do it right, OR don’t do it at all.”

Read the rest of the material if you want to have a business website and do it right.

The Benefits of Having A Website

First, let’s put things in proper order. It’s always good to have an attitude that goes like this: “A website? What’s in it for my business?

It’s good that you ask. But, you should also ask why you are in business in the first place.

Here’s how your business benefits by taking your dose of online multi-vitamins:

1. It’s good for your image. Your website serves as an electronic equivalent of your printed brochures and people can view them anytime, anywhere. It means you are keeping up with times and you are at pace with technology. It reinforces your reputation and enhances your credibility.

2. It makes you visible. A business is no good if your customers and clients can’t find you. Having a website is like passing out your business card to several people. And since most website visitors come to a website through search engines, it would be good if you rank high in Web search results.

3. It communicates your message. A website can be a powerful and cost-effective communication tool. You can send out updates, good news, special promotions, product introductions, and similar information to your target audience.

4. It’s a feedback tool. You can hear from your customers and how they feel about your business.

5. It makes you money. Depending on how good you are at turning site visitors into paying customers, your website indeed can positively affect your bottom-line. If you believe that your business can make you rich, your website only makes it a little bit easier.

We’re only talking about a simple website here. Bear in mind that not all websites are created equal. Some have a lot of advanced features like those e-commerce websites that accept online payments, or those from the banks that allow you to perform Internet Banking 24/7.

Stay tuned for part 2 where we discuss main ingredients you need to prepare so you can have a killer website.

Update: Part 2 of this series of articles is now ready. Click here to read it.

PayPal For Business: What Every Entrepreneur In The Philippines Should Know

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If you are a Filipino Entrepreneur and you want to learn about PayPal and how essential it is in our business, you have come to the right place.

Let me introduce to you… PayPal Philippines. This article is presented in a form of Question-And-Answer, where I ask myself, and then I answer my own question. 🙂

Ready? Here we go.

What Is PayPal?

Quite simply, PayPal is an online payment solution that allows you to securely send and receive money over the Internet. You can think of it as a virtual Credit Card machine that sits next to the point-of-sale terminal, but minus the cute cashier and without the actual card swiping action. The widespread acceptance of PayPay all over the world makes it advantageous if you have a global operation or your business is operating 24/7.

Naturally, it fits well with businesses that have their own websites. But having a website is not even necessary for you to receive money. All you ever need to accept online payment via PayPal is an email address – not a website. That is, you can simply direct your paying client or customer to your account on the PayPal.com website and PayPal will take care of the rest.

Of course, there are other alternative online payment solutions available like 2Checkout, Authorize.net, iTransact and Google Checkout. But the primary advantage of PayPal is that it has a large number of user-base worldwide. It is available in more than 190 countries around the globe. And it is very popular here in the Philippines, particularly to the young generation of Internet users. Moreover, it has gained the respect of top calibre online businesses and it is the preferred method of payment on EBay.

Can I Accept Credit Card Payments with My PayPal Account?

PayPal is meant for that kind of business transaction.

It is a payment gateway that allows you to accept online payments from people using their credit cards, debit cards or their own PayPal Accounts.

What Are the Benefits of Using PayPal?

PayPal For Business in the Philippines

Power Your Online Business with PayPal

Aside from the ones already mentioned above, here are the reasons why you should use PayPal:

  1. PayPal is very secure. Their website says Paypal “uses the latest anti-fraud technology.”
  2. PayPal hides your financial information. If you have ever used your credit card to purchase online, you remember that they require you to provide at least three things: your card number, your name, and the Card Security Code. That exposes you to a potential credit card fraud especially if the website saves your financial data in its database. With PayPal, you only provide your PayPal credentials using your email address and your account password, nothing more.
  3. PayPal for Money Transfers. You can use it for money transfers and remittances to the Philippines, within the country, or anywhere in the world.
  4. Paypal supports multiple currencies. PayPal has a built-in Forex System that allows you to do business transactions using multiple currencies including our very own Philippine Peso and the ever mighty and universally accepted US Dollar.

What Is PayPal Account For Business?

There are three types of PayPal accounts, namely: Personal, Premier and Business.

If you are to use PayPal for business transactions, it is only appropriate to get the Business Account since it has special features that are not available on the simple Personal Account (individual shopper) or Premier Account (individual, non-business, occasional seller).

I Want To Set Up A PayPal Account. What Are The Requirements?

There are four things you need to have.

  1. An Email Address. Make sure you are using this one for business only. You don’t want to mess this up with your personal email account, newsletter subscriptions and things like that.
  2. A Bank Account. It can either be a Savings Account or a Checking Account (sometime called Current Account) preferably in the local Philippine Currency and in name of the business. This is needed so you can withdraw your money from PayPal and deposit it to your bank account. I would recommend getting one where Internet Banking is allowed.
  3. PayPal Bank Code. This is a Numerical Code assigned by PayPal to identify your bank. You can get this one from your bank or from this website. (See further explanation below.)
  4. A Credit Card or Debit Card. Get this one from a credit card company or check out with your favourite bank. I recommend that you use a credit card here. That would provide an added security on your part.

Special Note: A lot of local bankers in the Philippine are not even aware of PayPal. Don’t be surprised if they give you a blank stare when you ask about setting up a PayPal Account using your account with them.

The easiest way to tell if PayPal has a tie-up with a particular bank in the Philippines is to check its respective Bank Code from this URL:

http://pages.ebay.ph/bankwithdrawal/bank_codes_ph.html

That is the official website of eBay Philippines; PayPal is an eBay Company. That is the most reliable source there is. Don’t ever get it from any other websites.

I Want To Sign Up Now, Tell Me How

Remember to sign up for a Business Account. Click here to reach the sign up page from the website.

Alternatively, you can click on the image shown below.

Sign up for PayPal and start accepting credit card payments instantly.

Again, it’s for your business so get the Business Account.

If you should first try to get an account for personal use, I would recommend that you sign up for the Premier Account instead of the Personal Account. Who knows? You might have some stuff you want to sell personally so you can test your new-found PayPal Powers. 🙂

This article is intended to provide you with the essential information about PayPal as it relates to your business. As an entrepreneur, this is one of those important things you have to be aware of.

Hopefully, this article gets you up to speed already with PayPal.

The 3 Business Entry Options

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Are you thinking of starting a business in the Philippines? Do you know where or how to start?

Today, there are so many business opportunities available from almost any type of industry in the Philippines that it’s easy to lose focus on what’s really important.

So you want to be in the food business? You say you love to cook. And they say Filipinos love to eat. From Jollibee and McDonalds to those little food carts you see in the malls, there’s no end to the number of franchise operations available in the market. That’s just for the food industry. There a couple more: water refilling, ink refills, schools, laundry shops, salon and spa, and many more… you name it.

In any of these lines of businesses you can either venture on your business starting from scratch, or take over an existing business, or buy a franchise from established brands. These are basically the three options available to you. Let’s discuss each one in the succeeding paragraphs.

1. Start From Scratch

A lot of businesses are started this way. That is, the founders came up with the business idea, setup the plans, raised the necessary funds and so on.

The new business venture is typically unknown in the market. And naturally, it is still struggling to carve a name for itself.

From ideation to launch and then finally running the operations, all these entail a lot of hard work for the owners and his team. It’s even more tough especially if the venture is trying to break into a market dominated by well-known brands.

On the positive side, unlike buying an existing business, which is discussed next, the owners can take comfort in the fact that there is no negative history to overcome. That is, there’s no bad press to haunt you down.

And unlike a franchised operation, which will be discussed later also, you can be creative in the way you deal with the changes in the market conditions by offering discounts and incentives as you see fit, without getting an approval from the parent company (the franchisor).

If you have done your homework well, you have probably identified the weaknesses of your competitors. You can even exploit those areas where they fail to satisfy their clients and customers.

2. Buy An Existing Business

In the Philippines, this is the business road less traveled… and for good reasons. Buying a business from someone else is very complicated and should be avoided by first-time entrepreneurs who can’t even interpret a financial statement.

Business Opportunities

Pick One: Start From Scratch, Buy A Business, Or Get A Franchise

However, buying an existing business at the right price also presents a lot of advantages, among them are the following:

  • It’s less work on your part. The start-up stage is one of the most challenging parts of a business operation. If the business has been in the market for quite some time, you are lucky for skipping this part. It’s like adopting a three-year-old kid. You skip the pregnancy part and you don’t even experience the painful process of delivering the baby from your tummy.
  • If the business is already profitable, that spares you from having sleepless nights.
  • You already have a list of established clients and vendors.
  • Machines, equipment and other tools necessary in the operation of the business would probably stay and you can use them right away.
  • You can learn some lessons from the experiences of former owner. That is, if he can provide you with honest information, stories and data.

But then again, this option should be approached with extra caution. There are a lot of factors to consider when taking this option. You have to know such things as Business Valuation, Financial Statement Analysis, and other similar skills.

3. Buy A Franchise

The International Franchise Association has defined franchising this way:

Franchising is a method of distributing products or services. At least two levels of people are involved in a franchise system: (1) the franchisor, who lends his trademark or trade name and a business system; and (2) the franchisee, who pays a royalty and often an initial fee for the right to do business under the franchisor’s name and system.

Essentially, you as a franchisee can run your own business and leverage on the resources and experiences of the parent company. No more re-inventing the wheel. This is far less risky that trying to start from scratch and venture on your own.

It’s been demonstrated by a number of studies that franchised businesses have much greater chances of success compared with businesses started from scratch.

So basically, when it comes to real business opportunities in the Philippines, you have three options available. Should you start from scratch, buy an existing business or get a franchise? Whatever your choice is, remember that success is never guaranteed. You still have to put in the required work, strategies and creativity in your business.

5 Factors To Consider When Choosing A Business Legal Structure

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One of the crucial decisions you have to make when setting up a business is the choice of the legal structure upon which to base your business.

The term legal structure is sometimes referred to as the “ownership structure” or simply “business structure”.

Here in the Philippines there are basically four options available to you. These are:

  1. Sole Proprietorship. In this setup, you and the business is one the same.
  2. Partnership. This involves an agreement between two or more individual to engage in a business activity.
  3. Corporation. This is an artificial being and a legal entity separate from its members.
  4. Cooperative. This definition is taken in part from the Cooperative Code of the Philippines: “a duly registered association of persons, with a common bond of interest, who have voluntarily joined together to achieve a lawful common social or economic end…”

Some of you may have already heard of those types business forms, but don’t give it much thought. Each one has each own set of advantages and disadvantages; we have more about that in a separate article.

But right now, the question is: How do you know which legal structure best fits your business?

The following are five important factors you need to consider:

1. Ownership Flexibility and Control

Do you want to go it alone or with several people in a team? How much control do you want to have to influence in the direction of the company? Are you comfortable working with other decision makers?

True or false: Two heads are better than one.

2. Future Needs

Business Legal Sructures In the Philippines

Go Solo or With A Team?

How do you see your business in some future time, say 5 or 10 years? Do you want it to continue operating even when you are already retired? Are you planning to sell it out some time so you can spend more time at the beach, swimming with the dolphins?

How does “100 years in business” sound to you? There are locally based companies in the Philippines that have reached that milestone. It’s quite an achievement for them. Kudos to the founders for thinking long-term in serving the community!

Will you be inviting outside investors to help support the business and share the success with them? Do you see it going public soon and be listed in the Philippine Stock Exchange?

These questions are worth pondering if your business is here for the long haul.

3. Cost of Formation and Recordkeeping

In general, the more complex the legal structure, the more expensive it is to set up and the more time required to administer the business. You have to factor this in during the start-up phase, especially if monetary assets are hard to come by.

4. Legal Liability

How high is the potential of your business to incur liability?

In a sole proprietorship, you are also personally liable for whatever liabilities incurred by the business. That’s very scary if something really goes wrong. Naturally, you want to protect yourself against too much exposure to risks and lawsuits as a result of doing the business activity.

5. Tax Implications

You have to look at this in the light of your business goal and your individual situation.

Which business structure has favorable tax advantages? It is wise to avoid taxes, or defer its payment as much as possible. This must not confused with tax evasion.

If this part is really important, and it will be in sooner or later,
you should hire a professional on board who is an expert on Business Taxation in the Philippine setting.

For most people, the choice of business structure is very clear from the start. For others, the questions posted above would take a long time to answer and that’s a good sign that you are not careless in going about it.

There is no right or wrong answer here. Only you can answer those. You be the judge. After all, it’s your own business.

7 Ways To Get Rich in the Philippines

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“If you stay here in the Philippines, you’ll never be rich.”

Those words came from my cousin who is a seaman.

When I was a kid, I was determined to become a seaman. Well-meaning as they truly are, my elder folks back home somehow led me to believe that it’s the only way you can become rich at the cheapest amount of investment in school. And from my observations of my own family and close relatives, it’s not difficult to tell who from among them has fattest wallets. I was convinced. I have to be a seaman.

I have two close friends — a couple — who are overseas workers. Every time we meet when they are back home in the Philippines, the husband would always say there is “no hope” for anyone to become rich here in the Philippines.

“Look at the salaries of your employees,” I remember him say. After a long pause and some kind of mental calculation, he continued, “I could earn at least 10 times as much if I do the same thing abroad.” That is, his one month salary abroad is equivalent to a year’s hard work here the Philippines. What a magic geography can do!

Do you agree? Isn’t it ironic why every Filipino’s dream is to flee from the Philippines?

I beg to disagree. That’s why I decided not to become a seaman. I could go on arguing why such kind of thinking is fundamentally flawed, but I’d rather not elaborate it here.

Suffice it to say that it is highly possible to become rich in this country. It can be done. A lot of people are doing it already. You, too can make it here!

Let me show you some of the ways.

1. Be Born Rich

Some guys are lucky to be born to a rich family. There is nothing wrong about this. If this is you, you owe it to yourself and your parents to keep the family wealth, preserve it, and let it grow for the future generations.

2. Marry Rich

Everybody loves shortcut. When it comes to wealth transfer, the marriage certificate is the ultimate shortcut ever devised by mankind.

“If thy marry for money, thy surely will earn it.” –A wise, anonymous lady.

3. Enter Showbiz

A lot of Filipinos could sense it already. That’s why when an audition for a talent search is conducted at some place in the country, people would flock to go there, endure the hardships just to get their ration of riches and fame… even just temporarily.

“The celebrity syndrome. When people forget who they are and start to believe what other people say about them.” –Paulo Coelho, The Winner Stands Alone

4. Become A Boxer

make money

A Wanna Be A Billionaire So Freaking Bad

If you can pull punches like Pacman and you’ve got foot works that could beat any breed of chicken, by all means don’t be shy… come out in the open… box.

Just make sure you know how to get the attention of Bob Arum and insist on fighting in the land of the free, home of the brave. That’s where big bucks are coming from.

But here’s the trick: you have do the boxing there (therefore, earn there) and live here in the Philippines. That’s like becoming an OFW, but you only have to really work hard for 1 month out of 12. And your earning potential? That’s directly proportional to how many elite boxers you can knock on the floor in the early rounds.

Let’s get ready to rumble?

5. Play Lotto

The game of chance is as old as mankind. In the Philippines, there are two kinds of gambling: legal and illegal — talk about double standards. If you should try to make it, you have to know the difference. Lotto tops the list of my recommendations.

6. Fool The People

If it already runs in the family or you’ve got the right connections, this route is either easy or bloody. And those who have taken the journey could tell you how good it is to be in power.

Tell the people that your main vocation in life is to become their servant. Plus, you love the poor, too. But never, ever tell them the ultimate truth: you don’t want to become one of them, or live where they live, or eat what they eat.

You only have two potential enemies here: your own conscience and the other guy who is always planning to kick you from your sit.

7. Own A Business

Seriously, this is the best chance left for most of us Filipinos to make it financially. You can’t be re-born to a rich family; at least not in this lifetime. Marrying a rich guy/gal is really like playing the lottery. Most of us don’t have a remarkable talent we could proudly take outside videoke bar. And we would rather just watch boxing over cable TV than actually be in the ring.

Business… Let’s give it some thought.