Sorry, guys, but my article yesterday, Isdaan ni Bob, was my annual April Fools joke! Yep, the truth is that I have no plans for a fish stall in Bankerohan!
It is true, though, that I have been thinking of doing a more traditional, non-internet business, but nothing nearly as “Filipino” as having a stall in the Public Market! Actually, Feyma and I have a business in mind that we may be setting up later this year. If we were to move ahead with it, it would likely be located in one of the local malls, perhaps SM one of the other local malls. If we do it, I will share more about it later on this site.
Why do I want to venture into a brick and mortar business instead of an Internet business? The answer is simple and only requires one word – diversification. I have a lot of online businesses, and they serve me well. For the past 8 years, I have had no income from any source other than online. But, I am of the opinion that it is always good to branch out, spread your bets over a number of different things, and generally protect yourself from a downturn in one of the venues that you are doing business in.
For example, over the past 2+ years, most of the world has been deeply impacted by a very tough recession. Interestingly, the Philippines has really not been deeply impacted, and in fact the economy here is still growing. It has not entered recession like the rest of the world has. Seeing this has opened my eyes that it would be a good idea for me to diversify into a business that will also be based in the Philippine economy. All of my businesses that I have now are focusing on a clientele everywhere except in the Philippines, and that hurt my business over the past couple of years. I can see now that to diversify into the Philippine economy would be a wise move, and something I should have done before.
Diversification is something that I want to emphasize to you if you plan to live in the Philippines. Not only diversification in terms of a business, but in all financial matters. For example, if you most of your banking in your US bank (or whatever country you currently live in), consider diversifying into two or three different banks in the USA, and also into a Philippine bank or two. Why? Think about this… do you remember a few weeks ago when LiP writer, Jawz told us that his bank in the USA had frozen his ATM card? Well, if he had several different banks in the USA, he could have whipped out an ATM card from one of his other banks to fill the gap while he fixed his situation with the one bank that had frozen his account. If he had a Philippine bank, he could have walked into a local branch and gotten some money or talked with a teller or even the bank manager if need be.
My point is, when you live in the Philippines (or any foreign country) always give yourself plenty of options. You never know when your bank in the USA will be meaning well, and trying to protect you and cut off your funds because “somebody in the Philippines is defrauding your account.” Well, the fact is that there is no fraud going on at all, they just forgot, or did not know that you are now living in the Philippines. In fact, it is a good idea to make sure that your home bank knows that you are in the Philippines, so that they won’t cut you off, but even if you let them know, these things still happen.
Diversify as much as your life as you can before becoming an expat. It will pay off in dividends as the years pass of you living overseas.
Hi Bob-Good advice on banking and not to leave yourself in a fix by single sourcing.
Regards.
Jim.
Thanks, Jim, glad you find the advice useful! Happy Easter!
You are a wise man. Even with the Internet I have noticed many new sites popping up focusing on the expat market either with blogs or forums and they back end it with banners, google adsense and probably direct services like flowers, etc. and this invariably will be more competition for you. I too have a website business that serves an entirely different market and the beauty is how little time is necessary for me to update the site so it looks fresh to new visitors as well as regular visitors and customers. I am thinking to hire a professional web designer to creat emore interesting bells and whistles such as video training using short teasers to sell the actual training. Things like that as my business too is becoming more competitive everyday and a dollar is harder to make than before.
I too have given thought to something more mainstream that services a segment of the Philippine market and that being high end Real Estate development. While the capital requirements are huge I will seek out like minded people to co-venture. I will focus on the very high end market building condominiums in the 15 – 25 million selling price range in very, very special areas of the country underming the competition in both price and finishings. Building costs today (25 -30K sqm) for a nicely finished product are generally 1/4 to 1/3 of the sales prices (100k sqm) so it affords huge profits. It is not pie in the sky but what Ayala, Robinsons, Landco, Sta Lucia…..etc and other developers are laughing all the way to the bank everyday while their 100,000P per sqm condos sell out.
Wish us both (you and I) luck LOL in whatever turn out with our respective ventures
Hi richard – I do well with business on the Net, but diversification is a good thing, and something that I intend to pursue. Good luck in your quest toward diversification as well!
Hi Bob – Happy Easter. Brick & mortar is a good way for an e-commerce business to beat the brownouts, too. No closing up a small shop for the day just because the curriente went away.
I heard that the newer, “Greener” candles work with far less electricity than their predecessors, so you’d even save on the electric bill while enjoying their candle light at your business during a brownout. 😯
There’s the ticket, Paul – candle light dining and kinilaw. The brownout-proof restaurant.
Happy Easter, Paul. Ha ha… once you go Brick and Mortar, it ain’t e-commerce anymore! 😯
You mean all of your computers and inventory are outside? 😯
😆
❓
I fully agree with you Bob. As I think I have suggested previously, it would stress me out having to worry not only about getting a turn out of a business, but then having to worry about getting a good exchange rate before I could get the money. Two ways of being hammered in a downturn really. That said, it’s worked okay for you up until now.
I think you mentioned previously that like myself, you have a retail ops. background, and although it’s been a long time since I trod that path for my everyday income, it’s still really something I’d like to do. I wish you the best of luck with it. In this day and age though, it is actually quite difficult to get your hands on a decent unit somewhere like SM, since they tend to like well known existing (proven) retailers. Having managed a major mall in Jeddah for some time, I understand this too, though even getting some of the major international brands to pay the rent on time can be a struggle, and they think they are a major attraction so you won’t shut them down. (But oh how quick they issue the cheque when you cut their AC
off)!!
Well, it’s Easter time, so a happy Easter to you and yours Bob, and of course, to all Lippers too!
Jim
Hi Jim – Yeah, my background is in retail. The venture that Feyma and I are considering, though, is not retail related. It’s more of a services business that would be located in a mall. We’ll see if it happens! 😆 Happy Easter to you and your family!
Interesting Bob. Please share the costs to open such a venture. Last trip I noticed CD-R King seemed to have a steady stream of customers in both locations I saw. I was in need of a video camera to RC TV cable…must have hit 20 places…never found it. When I arrived Bangkok found 5 different stores that had the cable in less than 10 minutes.(Pantip PLaza is THE place to go for anything electronic!!!)
IMO having a mixed dollar / peso income stream is a smart call, minimize any major shifts in exchange rates.
Hi brian – I don’t have a handle on the costs yet, because we are only in the “thinking about it” stage for now. But, I will keep you guys informed as we move forward. Yes, CD-R King is very successful here, and they have about a half dozen outlets in the city!
LOL, Bob! Having shared a stall at the old Bankerohan Market, though I never worked there, I was concerned about you doing the same, though I didn’t want to rain on your parade. Well, you certainly gave my wife & I a lot to talk about, yesterday! I’ll have to remember to keep my distance from other foreigners next April 1st, as I do tend to forget the significance of such days!(obviously, my wife does, as well.)
Mike2
Hi Mike – Ha ha… so I had you and your wife talking! That was my idea, to shake people up a bit! Happy Easter, Mike!
Don’t put all your eggs in one basket is good advice. Having a local account is good sense too. When we moved here in England our bank would not move our account to a new branch where we live. So they lost some of our business.
A Happy Easter from a Cold Damp England
Marjorie
Exactly, Marjorie! Diversification is a key to keeping things running smoothly! Happy Easter to you!
I bet Feyma is relieved that it was a joke: she won’t have to spray you with Lysol every day after work.
Aside from the old photo, what made me suspicious was that your business didn’t have a professional-looking web site the very first day, complete with discount coupons that folk could print out for special deals.
Not that I knew for sure you were kidding us, Bob Martin of Mindanao, I don’t think I would put anything past you. If it turned out to be true, I was going to offer to put a mess of good old Maryland Old Bay seasoning in a box and send it to you.
Ha ha.. good one, Peter. The lysol supply is safe!
haha…well…you got me “Hook, Line, and Sinker!!”
Only thing that should have given it away to me was when you said you would be at the stall each day running it…not that you couldn’t do that..but would you want to..lol.
Good April Fools Bob,
Danny 🙂
So, I got you on this one, Danny? Ha ha… I hope you enjoyed it.
Yes you did Bob, I have been so busy lately..its not even funny..haha..and wasn’t even thinking about April Fools Day..:)
But diversity is good, and like you pointed out..its not always good to have your eggs in just one basket. 🙂
Take care,
Danny 🙂
Hi Danny – Well, since you said that you are coming to the Philippines soon, at least you can get some rest for a while! I hope you can make it to Davao!
A couple things I would advise in regards to ATM cards.
1. Never use your ATM card as a credit card. Yes, there is a Visa or Master Card logo, and hotels and such will accept them as credit cards, but if the card gets jacked, it is a hassle. It happened to me a few years ago. I was using my card for lots of everyday purchases, a common practice now in the US – convenience of a credit card, but you’re not using credit. Anyway, my card number was stolen during one of the transactions, Visa alerted me to the fraud very quickly, and my card was immediately cancelled. There was about $900 that had been authorized by Visa before the fraud alert. I ended up getting all my money back, but this money was unavailable to me for over a week, and there was the hassle of waiting for a new ATM card. The lesson to this, if fraud happens with a credit card, it’s not money directly linked to your bank account.
2. Do not utilize an ATM card linked to your primary account. Setup an alternately account(s) for ATM transactions. Keep low balances in the alternative account(s), just enough for your ATM cash needs. This way, if your ATM gets jacked, only a small amount of cash is at risk.
3. Avoid logging into secure sites (e.g., bank account, email account) at public wifi spots. The risk may seem low, but there is a risk nonetheless. If you are a road warrior, or have no internet service at home, I would suggest a Smart or Globe aircard for your secure logins. Prepaid minutes are not that expensive.
Good advice, Gary!
Right Bob .. never put all your eggs in one basket,someone might drop it, then your eggs are all gone 🙁 no money now ..we had 9 piglets born on April 1 ..so far so good ..Phil n Jess
Hey Phil – Congrats on your new babies! Are you handing out cigars? 😆
Happy Easter to you, Feyma and family…good advice. Never put your eggs in one basket. About banking, advising your bank your whereabouts is a must, having a local bank is another (in local currency if possible) is another. As for businesses, I was thinking of the same like service oriented type with little overhead. Just don’t know which one is marketable in the country.
One might say the Philippines is a 3rd world country, and infrastructure underdeveloped. I live in Toronto, first world country and I just moved to a new place. I made all the necessary arrangements prior but: it took 2 days to get me hot water, because someone forgot to turn on the gas meter, and they decided to change my hot water tank at the same time; then the cable guy didn’t find the cable room, so I’m stuck without tv until next week. What takes the cake is my telephone and internet service provider. I planned my transfer 3 weeks before, spoke to 3 agents, and they even charged me “transfer” fee but I discovered no one had completed a service order! So no telephone, no internet until Friday, by then, I would be in the Philippines.
Part of our new economy is how to roll with the challenges, and learning to outwit the buggers. After working so many decades, one would think life would get easier, not these days.
Maybe I miss the Philippines or something, but I could actually picture you working in a fish market for a day or so to polish up on your Bisaya.
Ha ha I might go there myself to buy some fish and practice and I’ll probably forget all my words.
Ha ha… I go shopping at the Merkado all the time, Kevin…. but you won’t ever catch me working there! 😉
Hello Bob. It would seem that diversification is very important after the economic shock waves of the past few years. I would not give up just yet on the US dollar but I would certainly spread my wings and venture into other areas. Millions of Americans during the last decade or so had most of their wealth tied up in houses of all things; not a smart move as events panned out.
Best
Jody
Hi jody – Somewhat true… my only argument with what you say is that, IMHO, most Americans didn’t have any wealth at all tied up in their houses. Most Americans kept stripping the wealth from their houses through refinancing, then using the cash equity that they borrowed to live the high life. When it all came crashing down they had houses that were worth a lot less then they owed on it. A sad state of affairs!
Many people in the States and Europe, too, are paying a very heavy price for their fiscal foolishness. Managing a life on credit is an unfortunate necessity for some people, but maintaining a life-style on credit is very foolish. I can’t really feel sorry for people who do that. Some also, as some said, thought that rising real-estate prices was a permanent serendipity for them. I have friends who went into an eating frenzy several years back and purchased two and three condos in Florida when the market was hot there. Then they found themselves holding devalued properties that they can’t sell of rent. It is always best for people who have no real business savvy to be conservative with their money. By some real-estate, get an adviser to help you lay out a plan and put some money in the stock market, have a 401K and save money. Opening a business is best left to those who have the skill for it. Some people are dreamers and best left to stay away from doing business.
Hi Vin – A pretty good evaluation if you ask me!