Running a sari-sari store in the Philippines is an important livelihood for many Filipino families. Yet, dealing with bank loans and managing stock can be quite challenging for store owners.
Finding solutions to these issues can make a significant difference in running a successful store.
How can you effectively overcome these common problems faced by sari-sari store owners?
Key Takeaways
- While running a sari-sari store may look easy, many store owners struggle with managing their stock and securing financing to grow.
- These 7 solutions will help sari-sari store owners thrive.
7 Problems and Solutions Encountered By Sari-Sari Store Owners
Running a sari-sari store is often fraught with unique challenges.
The following subsections detail typical issues from financial constraints to supply chain disruptions and offer practical solutions.
Financial Constraints (Kulang sa budget)
Financial constraints are a common hurdle.
Limited capital can restrict your ability to stock diverse and popular products, leading to missed sales. Scarcity of funds may also prevent store improvements that could attract more customers.
Warning: Customers lose interest in your store when they see empty shelves.
And the bigger problem is that news travels fast, so customer complaints can quickly damage your reputation ("uy wala nang paninda si ano, baka magsasara na?).
The availability of stock is important to your branding.
To overcome these constraints, consider enhancing your financial literacy.
Simple practices like maintaining accurate records and understanding your cash flow can make a huge difference.
Look into tailored financial support programs or microloans aimed at small businesses. These can provide the necessary boost to expand your inventory without breaking the bank.
Working conditions and sustainability ("Bat' lagi na lang ako ang nagbabantay?!")
Poor working conditions can make it difficult to run a successful sari-sari store.
Long hours, inadequate facilities, and a challenging work environment can lead to burnout and inefficiency.
To address these issues, invest in ergonomically friendly equipment (like a good office chair) and create a more comfortable - and cleaner - workspace.
If possible, delegate tasks among family members to reduce your workload.
This not only improves your working conditions but also fosters a sense of shared responsibility and support.
Pwede naman si bunso magbantay pag Sabado, di ba?
High competition (Lahat ng kapitbahay may tindahan)
High competition from other sari-sari stores and convenience chains like 7-Eleven can squeeze your profit margins.
Storytime: When I was a kid, my mom had a popular sari-sari store. It was the go-to store across five blocks in the subdivision because it sells almost everything.
Unfortunately, our house is located at the end of the street and when a neighbor five houses away put up their own store, our daily sales declined, much to the chagrin of my mother, who had to think of new ways to attract loyal customers.
Customers often gravitate towards stores offering better prices or a wider variety of goods.
Differentiate your store by providing exceptional customer service and unique products.
Engage with your barangay and build strong relationships with your customers. Additionally, consider partnerships with local suppliers to offer exclusive items, enhancing your store’s appeal and driving loyalty.
Lack of debt and loan accessibility (Walang mauutangan)
Acquiring loans can be challenging, especially for workers in the informal sector.
Traditional banks may be reluctant to lend to small, informal businesses because this demographic has several perceived risks ("walang financial history records"). This lack of debt accessibility can stymie growth and expansion plans.
Seek out microfinance institutions that focus on small enterprises. These organizations are often more willing to provide small loans with flexible terms.
Tip: Finance apps like GCash, Maya, and CIMB offer cash loans. Use these apps to settle bills and pay for goods and services to increase your loanable amount.
For example, my G-Loan's loanable amount increased from PHP 10,000 to PHP 25,000 because I use the app almost daily.
Also, consider collaborating with cooperatives which may offer interest-friendly lending options tailored for micro-businesses.
Economic Fluctuations (Bagsak ang ekonomiya)
Economic downturns and fluctuations can severely impact sales.
When the economy is down, purchasing power declines, and your customers might buy less or resort to credit.
Tip: One indicator of an economic downturn is when the peso-to-dollar exchange rate is high (i.e., USD$1=PHP59).
When this happens, try to stock up on daily necessities like cooking oil, rice, or canned goods because the demand for essential goods will rise.
Stay adaptable by adjusting your stock to include essential, high-demand items.
Keep an eye on market trends and be prepared to change your offerings. Building a small reserve fund (i.e., bank savings) during good times can provide a cushion during economic low points, helping you weather the storm.
Supply Chain Issues
Supply chain disruptions can leave your shelves empty, particularly if you rely on a limited number of suppliers.
These interruptions can result in lost sales and frustrated customers.
For example, when the Panama Canal dried up, over 200 ships were stuck in "traffic". This resulted in delayed deliveries and a lack of supplies.
Mitigate this by diversifying your supplier base.
Establish relationships with multiple suppliers to ensure you have alternatives if one source dries up. Additionally, invest in proper inventory management practices to forecast demand better and plan your purchases accordingly.
Tip: Online apps like GrowSari and Peddlr are Filipino innovations that will mitigate these supply issues, making it easy for your tindahan to stock up on goods!
Customer Debts (Mga customer na ayaw magbayad ng utang)
Allowing customer debts can be a double-edged sword.
While it might boost immediate sales, it also ties up your capital and can lead to bad debts if customers fail to repay.
Implement a strict record-keeping system to track customer debts and repayments. If you don't have a computer, pen and paper will do.
Get our Astig Na Tindahan record-keeping sheets here for only 99 pesos
Set clear terms and conditions for extending credit, such as payment deadlines and limits. Encourage prompt payment through follow-ups and offer small incentives for those who pay on time.
Back in the day, our store only allowed credit to certain customers: those with good credit standing or those who can pay (i.e., people with regular jobs).
Sari-sari store owners will face challenges...
...but they can be overcome with proper planning and execution
There are several challenges faced by sari-sari store owners. That's normal and a part of the life of being an entrepreneur.
With some smart strategies, these problems can turn into opportunities.
Educate yourself with the necessary financial know-how, analyze how your customers interact with your store, and keep your pulse on the economy. These will ensure that you come out on top every time.
