Never too Small for Hope- Part I (Sari-sari store)

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Image credit: FreePik

Doing business is largely a family affair in the Philippines - 80% of enterprises are family-owned or family-controlled. Microenterprises are the most intimate and the most common of these businesses. Nine out of 10 all micro, small, and medium-sized enterprises (MSMEs) in the Philippines are microenterprises. Their kinship is the most deep-rooted because members of the community build these businesses around local needs.

Strength comes in numbers. Being small and having few employees put microenterprises in the most disadvantageous position. Most microenterprises are cottage industries, typically employing only family members. They consist of one to nine members and the largest ones have $6,000 in assets.

The Philippines is one of the countries with the highest economic damages as a result of disasters, having an Average Annual Economic Loss (AAL) of $284 million. Financial deficits hit the smallest enterprises the most. Economic losses have a ripple effect that magnifies and multiplies the challenges, especially for microenterprises. The COVID-19 pandemic has introduced lockdowns that prolong the hardships for many of these businesses. 

The first part of our series explores the most inherent microenterprise in the Philippines. The sari-sari stores (mom and pop shops) are built into the DNA of every neighborhood and block across the national landscape. There are over 1.3 million sari-sari stores in the Philippines and 94% of consumers depend on them for everyday necessities.

At APP, we focus on the vulnerable sectors of our society in our development initiatives. MSMEs are among the priority sectors of our national chapter, the Philippine Preparedness Partnership’s (PHILPREP) and its targets in local program activities. PHILPREP has developed these case stories to amplify the voices the smallest of enterprises during the COVID-19 pandemic. It seeks to strengthen knowledge production and learning exchange at the national and regional levels. It seeks to portray human stories to raise awareness on how disasters affect the most vulnerable communities.

Monalisa Maiquez, 41, Resident of Sta. Maria Kalamasig, Sultan Kudarat

Monalisa is the breadwinner in her family. It is a role that keeps her committed to maintaining her sari-sari store during the lockdown period. She lives with her brother, sister-in-law, and their two kids. 

Monalisa

The family of five depends on local government assistance since the community quarantine that started on March 16, 2020, “We have received relief goods four times since the lockdown started. The local government unit of Kalamansig provided five kilograms of rice, two cans of sardines, three packs of instant noodles, 250 grams of sugar, and one pack of instant coffee.” 

These rations are essential as Monalia’s revenue has been cut in half since the lockdown, “We would invest P8,000 to P10,000 every week for a profit of P1,000 to P1,500. We are only able to buy up to P5,000 of supplies for the store and our profits do not reach more than P500 weekly.” Her profits barely cover the P2,500 to P3,000 for household expenses. 

Mobility restrictions introduce new obstacles for businesses as they lack supplies from the shortage of stocks. Monalisa is currently limited in procuring supplies, “I would travel to the market depending on what I needed. Now I am only allowed to make these trips once a week. We are also constrained to the number of purchasable items. For example, each business owner can only buy six-packs of instant noodles and six cans of sardine.” 

Monalisa

Any form of financial assistance would promote the sustainability of Monalisa’s shop, “I have never experienced such a blow to my daily operations. I would need about P15,000 to recover. The business income is siphoned into funding our daily needs making savings nearly impossible.”

Mary Jane Selecia, 41, Resident of Tinungkaan, Maguindanao 

The subsidy in income only reminds Mary Jane that her household needs to cut corners - “My shop is bringing in one-third of the profit. I would earn around P4,000 and now I am fortunate if I make P1,000 a week. We invest P3,000 a week to keep the store running.” She lives with her husband and five children. Their daily expenses come to P9,000 per month and were previously covered from the sari-sari store’s profits. 

Borrowing money is becoming a vicious cycle for Mary Jane, “We have no savings and the income we make for our businesses go towards repaying our loans from relatives and friends. It seems like we are borrowing to pay over and over again.” Relief information is even more scarce when in the remote mountainous areas like Tinungkaan. The interventions in Mary Jane’s town were constrained to the Department of Social Welfare and Development (DSWD) conducting a survey to determine the poorest population in the village. 

Mary Jane

Mary Jane’s husband works as a Barangay Secretary and his work became an unexpected lifeline, “We did not need to apply for the Social Amelioration Program (SAP) because of my husband’s job. We are also beneficiaries of the Pantawid Pamilyang Pilipino Program (4Ps).” The SAP has given qualified families P5,000 to P8,000 per month for two months. “We bought one sack of rice. The remaining money is additional capital for our store.”

Her family’s coping mechanism is in her backyard, “Our alternative sources of income are planting vegetables and raising farm animals. The small farm supports us while providing us with food. We are often forced to consume supplies from the sari-sari store.” Stock in her store is already limited because of dwindling supply in Noro, where she buys her supplies. Transportation cost for each of the trips to Noro is now P100, which is an exacerbated cost during the lockdown. 

Everyday expenses have become a challenge for her community, “There is a decline in sales because many of our neighbors and customers do not have work. I fear that we may have to shut down if this continues. I would feel more hopeful if I had P10,000 to replace the needed inventory.” 

Marcia Mangubat, 53 years old, Resident of Tinagacan, General Santos City 

The Mangubats are a persevering matriarch. Marcia Mangubat lives with her mother and two daughters. She runs her sari-sari store and the household with the mantra, “Maningkamot nalang gyud ta na mabuhi (we will work hard to survive).” The pandemic is no exception to this mind frame. Marcia’s store is the only source of income as her daughters look for jobs. 

General Santos City is still under a curfew to prevent the spread of infections. Marcia makes sure that her family obeys the rules while trying to carry on with daily life, “The new regulations include wearing a mask whenever one steps out of the house. The first offense is a P3,000 penalty. The following offenses can lead to one-month imprisonment.” 

Marcia

She understands that safety measures are necessary and adapting to the challenges is the only way forward: “I go to the market myself to buy all of my supplies from the market at the center of the city. I would go at least once or twice a week. The lockdown conditions have led me to make this trip every two weeks.” The supply shortage has decreased Marcia’s revenue from P4,000 per day to P1,500. Her current profits do not cover the P7,000 she needs for the monthly household expenses. 

The small bench and table for tea at the corner of Marcia’s shop is vacant these days. She has not experienced such a sales decline in 11 years, “I have been a member of Tinagacan Agrarian Reform Beneficiary Cooperative (TARBC) for six years so I was able to withdraw a savings amount of P5,000. I am afraid that I may reach a point where I will have to withdraw more of my savings.” TARBC teaches small business owners like Marica about how they can apply and access loans as well as create a savings scheme. 

The local government has distributed rice, noodles, and canned goods to families like Marcia’s. It is one of the many sources of hope Marcia holds, “The supplies from the store sometimes meet our daily needs. I start the day grateful that all of us are in good health.” 

Alejandra Cinco, 56, Resident of Lanao del Sur 

Cassava was imported from Latin America through the Manilla Galleons over 400 years ago. It has become a staple across the Philippines since then. The vegetable is a saving grace during the lockdown for Alejandra Cinco, “We grow cassava on our farm and I make homemade cakes to sell. Our harvest is not selling as much. I purchase sugar and the other ingredients for P100 and sell the cakes for P200. The cakes are the only profit I make some days.” 

Alejandra

The virus outbreak may not affect everyone’s health but it deprives many of their basic needs. “I was able to stretch P20,000 towards household needs during the first month of the lockdown. The expenses included the P3,000 I need for asthma medication every two months. We have reduced our investment in the sari-sari store from P1,500 to P1,000 or P500. Buying food for our family is the top priority.”

Alejandra and her husband are housing her mother-in-law, brother-in-law, daughter, and two of their grandchildren during the lockdown period. The additions have raised her household expenses from P6,000 to P11,000 - “We have cut costs wherever we can. My husband delivers cassava to the Malabang area. He earns P700 per trip. I have started to accompany him during these trips to buy some of my supplies at competitive prices.” 

Alejandra

Alejandra’s husband was the only one issued a quarantine pass when security measures were taken in April. She became unable to buy supplies from her local vendor: “I was referred to another grocery store but the prices were much higher. Our store sells basic goods such as sugar, coffee, soap, canned foods, and snacks. Some of these items have gone up to P10 more than before. It forces us to retail them at a higher price and lose the already dwindling number of customers.” 

The higher prices  and limited supplies have taken a toll on everyday operations. “I would have P500 to P1,000 in sales every day. Now I am fortunate if I make P300 on certain days,” states Alejandra. 

She currently relies on her savings and one of her children for support, “My son lives in Cebu City and has sent financial support through the remittance center in the Malabang area. We are fortunate that he is able to provide a portion of his salary.” 

The interviews for this series were conducted in partnership with the Social Enterprise Development Partnerships, Inc. (SEDPI). The organization was our main local partner for this publication.

Click the links for Part II and Part III of this series.