Starting your own sari-sari store

CEBU, Philippines - What most people consider as the easiest retail business to go into has become an integral part of the Philippine society and has contributed both to the country's economic growth and people's livelihood.

Sari-Sari stores, being a common part of the Filipino life, can be found in almost every street corner of Philippine barangays or barrios in both rural and urban areas.

This has been the set-up of the country's social system and a vital part of the micro, small and medium sector.

Most of these small retail stores are family-owned and are usually set up in a small space within or as an extension of the of store owner's house.

Despite the increase of consumers buying goods in grocery stores and hypermarkets, Sari-Sari stores, street vendors and open-air markets still dominate the Philippine retail industry, this according to the Philippines Retail Report Q2 2014 of the Business Monitor International.

Proof to this report is the increasing number of middle-income and lower-income people who venture into this business to augment the family's income.

Believed as the backbone of the consumer economy, Sari-Sari shops make up the estimated 30 - 40 percent of the retail sales in the Philippines.

While some don't succeed in this industry, others also find themselves developing their once simple retail-based store into a reliable and sustainable enterprise.

Retail industry driver

This income-generating enterprise has provided Filipino families--especially the women--an opportunity to increase their entrepreneurial knowledge and be part of the buoyant retail industry in the country.

For instance, the Martinez family, who owns a Sari-Sari store in Opra Village Capitol Site in Cebu City, has been blessed with a hard earned success out of their hardwork and persistence.

"Sa tanan namong naabot karon, pasalamat ra gyod mi sa Ginoo nga ni lungtad mi aning negosyo-a," 42-year-old Marilou Martinez, a mother of three, told The FREEMAN. "Pero sa di pa nimo maabot ang success, agi sa ka og kalisod."

The family who come from Davao City moved to Cebu in 2003 to continue the family's first enterprise: upholstery. The head of the family Ray Martinez, 42, is an experienced upholsterer.

It was hard for the family before when earnings from upholstery was not stable and enough for the daily expenses.

"Una gyod adto, nangutang ko og duha ka sakong uling," Marilou recalled, "unya akong gipamutos ug gibaligya. Dako og profit maong nakabayad dayon ko ug nipalit na sab ko pag-usab."

Later on, out of selling charcoal Marilou earned P300--as profit--which she decided to use as a capital money to start a small Sari-Sari store in their house. She said she really had to find ways to earn as she knows that her husband's earnings is not enough to fend for the family.

In her mind, setting up the store was the easiest and most convenient to do because it's home-based, an advantage for her to look after her children at the same time making money.

With the seed money at hand, she bought basic commodities such as coffee, instant noodles, soaps, canned goods, etc. to display and sell in their house.

They used to just rent a house with no source of electricity and water and eventually was able to own the property when their business was turning out good.

However, that challenging situation did not stop the family from attaining what they have achieved now: a bigger and thriving store and other sideline ventures.

Martinez Store now sells a wide variety of products such as rice, softdrinks, school supplies, condiments, snacks, soap and shampoo sachets, cosmetics, slippers, brooms, toiletries, charcoal, wood, vegetables, spices, dried seafood, cigarettes, medicines, mineral water and many more. It also offers loads for all networks.

Generally, retailers add a 20percent profit margin to most of their wares although for some items, it can reach as high as 30%.

Marilou shared they buy goods thrice a week and set aside separate budget for grocery items (P35,000), rice (P30,000), cigarettes (P10,000), sacks of charcoal and wood (P20,000) and softdrinks.

For retail store owners like her, she added, it is best to look for regular suppliers or shop in wholesale stores and public markets which give good deals in bulk orders.

How to succeed

Marilou said their success can also be attributed to proper store management.

The family does not spend on unnecessary things and avoid unending debt cycle which generally poses pitfalls if not handled properly.

She said she has to implement "no credit rule" as it is a business. Eventually, the family has increased their investment and was able to buy two second-hand jeepneys (rented for P750 a day), a land in Davao City, an Automatic Tubig Machine and jewelry (as investment).

In a day, they could earn a minimum of P10,000 and maximum of P16,000 in their operation from 5:30 a.m. through 10:30 p.m.

A store becomes attractive to customers if it offers a variety of goods and it is important to keep the inventory updated to always have ample stocks.

Martinez's store is financially independent which means that family's needs should strictly be separated from the operation, allowing a good financial turn-out.

Martinez family is just one of the thousands who engage in this free market activity which is keeping the retail market on the move and the country unique among the rest in the world. (FREEMAN)