NegosyoBuilder.com

Business Tips, Deals & Opportunities in the Philippines

  • Home
  • Resources
  • Contact Us
You are here: Home / Archives for Bricks and Mortar

Traditional vs Online Business

October 4, 2012 by CarlosV Leave a Comment

Let’s say you are to start a small business anytime soon, would you go for a traditional business — with an actual physical location — or pick an online business concept?

If you ask me, I’m bias, of course. I would always pick an online business over the one which is traditional, bricks-and-mortar. It’s the smart choice and later I will elaborate why by comparing the two types of businesses.

First, let me lay down the basis of comparison just to make sure we are comparing an apple to an apple. There are many forms of businesses, but let’s make this simple. Consider a small and familiar retail outlet. It could be a mom-and-pop bookstore, franchised store operation, or anything you are already familiar with.

Let’s start.

1. Location

They say the three most important factors to consider when buying a piece of real estate are: location, location, location. Many traditional businesses like retail stores and restaurants are overly dependent on the location. Being in the wrong location could mean committing financial suicide for your business.

An e-commerce store on the other hand lives in cyberspace. It’s a virtual real estate identified by such things as domain name, IP Address, sub-domain, etc. In a virtual world, location is not the problem. Your problem is being found out by your target customers. (I have more to say on this topic in another article.)

2. Business Or Store Setup

Online vs Traditional BusinessSpace rental, renovation, period maintenance — you have to consider these things in a traditional store setup. Furthermore, you’ll need a signage, furniture or fixtures, display areas, POS machines and other things needed to keep your business in operation.

In an online business setup, your website is your store. Yes, you still have to maintain it, keep it looking good, update your product listings and prices, or run a few articles. But in general, comparatively cheaper to do or buy and you won’t be sweating it out when doing these activities.

(See also: Build a profitable website; no programming skills required.)

3. Manpower

In general, a traditional store requires a much bigger manpower to operate than an online store.

More often than not, the size of the store’s floor area is directly proportional to the number of employees needed to operate the store.

4. Inventory

I once discussed with a medical representative about the possibility of setting up pharmacy. The one thing I can’t forget was his advice on inventories: As much as possible, you have to keep a wide range of different kinds of medicines in your store because once your customer goes there and you don’t carry what he is looking for, he would go to your competitor and might never come back to you again.

Keeping a large amount of inventory is one of the burdens you have to bear for running a traditional store.

With an online business, this one is less of a problem. You can start with minimal or even zero inventories and keep it that way. There are so many ways of doing this.

5. Business Hours

Bricks-and-mortars operate in the usual and standard business hours. Your staff have to go home, too.

An e-commerce store, on the other hand, can accept orders round the clock, 24/7 – even while you sleep. That means, passive income coming your way.

6. Customer-base

Since it is confined to a particular location, a tradition business can only serve a very specific, regional market. The only way to serve more clients and customers is to setup branches in different locations.

This restriction is removed if your business is online. You can choose to serve nationwide or even to do business internationally. As our tagline says, “Earn Global. Live Local.” That’s easily possible with an online business.

Share this:

  • Facebook
  • Twitter
  • Pinterest
  • LinkedIn
  • Email
  • Print

Filed Under: Bricks and Mortar, Going Online Tagged With: Online Business, Traditional Business

The Money Business in the Philippines

July 6, 2012 by CarlosV Leave a Comment

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.

Share this:

  • Facebook
  • Twitter
  • Pinterest
  • LinkedIn
  • Email
  • Print

Filed Under: Bricks and Mortar, Business How-To Tagged With: Make Money, Microfinance, Money Remittance, Money Transfer, Pawnshop

Fuel Your Business: Opportunities From Independent Oil Companies in the Philippines

July 4, 2012 by admin Leave a Comment

Is this an exciting time to be in the oil and fuel business? Petroleum, indeed, is an essential commodity that does not depend on the conditions of the economy; that is, we use and consume oil whether the economy is up or down.

In the previous article, we’ve shown you the business opportunities available from the country’s biggest oil players, known as the Big 3. Here we’ll explore the alternative opportunities offered by the independent oil companies or the so-called small players.

Anyone who is serious about becoming a distributor or retailer of petroleum products should consider the various opportunities from all parties, and weigh the advantages and disadvantages before finally embarking on this business venture.

Option #1: Seaoil Franchise

Seaoil is considered as the leader among independent oil companies in the Philippines. In 1980, it opened its first petrol depot facility in Mandaluyong serving local as well as multi-national companies. Frachising a Seaoil business means you are backed by the company’s more than 30 years of experience in the oil business.

Seaoil Franchise Investment:

  • Franchise Fee : P 500,000.00
  • Estimated Capital: P 3,000,000.00

The company also offers a customized franchise package. You can choose to franchise an existing station or start a new one. The minimum recommend lot area for the gas station is 800 sq m.

For details, please visit the Seaoil website at http://www.seaoil.com.ph.

Option #2: Phoenix Petroleum Franchise

The Phoenix Petroleum has its humble beginning as a family business in Davao in the year 2002. Originally it carried the name Davao Oil Terminal Services Corporation and in 2006 changed its name to Phoenix Petroleum Philippines, Inc. A year later, it became the first independent oil company to be listed in the Philippine Stock Exchange.

Phoenix offers franchising opportunity for those who want to become retailers of petroleum products and carry their brand. Phoenix requires from the franchisee a minimum of 800 sqm lot with at least 25 meter frontage for the site of a gas station. Aside from the usual business support common with other franchisors, what’s nice about the franchise concept of Phoenix is its flexibility. That means you can attach other businesses with your petroleum franchise provided it passed the approval of Phoenix.

The estimated capital outlay for a Phoenix station is 3M. It already includes the franchise fee, construction cost, equipment deposits and initial stock.

To know more about the company and the franchise opportunity they are offering, please visit their website at phoenixphilippines.com.

Option #3: Unioil Franchise

The company made its presence felt in 1992 when it opened its first gas station along the Ninoy Aquino Avenue in Parañaque. In 2003, it opened its door in Mindanao when they set up their first gas station outside of Manila.

Interested Unioil petroleum distributors should prepare somewhere from P 500,000 to P 1 million in capital. The company boasts of its estimated return on capital in as fast as one and a half to two years.

To know more about Unioil and their business opportunities, visit them at http://www.unioil.com.

Option #4: Eastern Petroleum Franchise

Finally, one other oil company that we want you to take notice of is the Eastern Petroleum. It was founded in 1996 by Fernando L. Martinez. The following year, it opened its first petrol station in Pasig City. In 2004, it already reached the Mindanao area by having their gas stations in Gen San and Davao.

Prospective franchisees can avail one of the following setups with their respective estimate investment requirements:

  • Basic Station (1 or 2 Islands and 2 pumps) — Investment starts at P2 Million
  • Regular Station (2 Islands and 3 to 4 pumps) — Investment starts at P5 Million
  • Large Station (3 Islands and at least 5 pumps) — Investment starts at P8 Million

Eastern Petroleum is very strict when selecting their sites. At bare minimum, your site should be at least 400 sqm in area with a frontage of 25 meters. Site must be in rectangular, square or L-shape. Furthermore, it must be at least 10 meters away from any creek.

Get to know more about the company by visiting their website at http://www.easternpetroleum.com.ph.

Share this:

  • Facebook
  • Twitter
  • Pinterest
  • LinkedIn
  • Email
  • Print

Filed Under: Bricks and Mortar, Business Opportunities Tagged With: Business Opportunity, Eastern Petroleum, Franchise, Franchising, Gas Station, Phoenix Petroleum, Seaoil, Unioil

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

June 30, 2012 by CarlosV 18 Comments

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.

Share this:

  • Facebook
  • Twitter
  • Pinterest
  • LinkedIn
  • Email
  • Print

Filed Under: Bricks and Mortar, Business Opportunities Tagged With: Business Opportunity, Caltex, Franchise, Franchising, Gas Station, Petron, Pilipinas Shell

Small Business Opportunities Philippines

Connect With Negosyo Builder

  • Email
  • Facebook
  • Google+

Articles By Category

  • Bricks and Mortar
  • Business How-To
  • Business Opportunities
  • Doing Business
  • Going Online
  • Money and Finance
  • Tech On Business
  • You On Business

Recently Written

  • 4 Financing Solutions Your Business Needs to Survive
  • Franchising Fees: What You Need To Know and Watch Out For
  • Top 3 Reasons Why Your Business Should Have A Website
  • Can You Really Make Money Online?
  • Traditional vs Online Business
  • How To Turn Your Hobby Into Cash
  • How To Build A Profitable Website With No Programming Skills
  • Domain Name Selection Tips
  • Why Rich Kids Hate Their Parents
  • Your Website In 5 Easy Steps

More Business Tags

Accounting Balance Sheet Branding Business Loans Business Name Business Opportunity Business Plan Business Structure Buying A Business Caltex Capital Cash Flow Cash Flow Statement Cooperative Corporation Credit Card Domain Name Financial Statements Financing Forms of Ownership Franchise Franchising Gas Station Get Rich Income Statement Legal Structure Make Money Marketing Online Business Online Payments Opportunities Part-Time Business Partnership Payment Gateway PayPal PayPal Bank Codes PayPal Philippines Petron Pilipinas Shell PR Software Start-up Taxes Tools Website
Negosyo Builder © 2025 :: Your Small Business Guide in the Philippines :: [footer_backtotop]
loading Cancel
Post was not sent - check your email addresses!
Email check failed, please try again
Sorry, your blog cannot share posts by email.