MANILA, Philippines - As a retailer for more than twenty years now I cannot help but observe the changes happening in retail—more particularly in Fashion, Restaurants and Cafes.
FASHION
So many brands have come in and continue to pour in. There is a glut of disposable fashion, name brands and struggling local names that will all be affected also by ASEAN integration and not just WTO rules. If you will start in fashion only now, be ready for a rough ride. IT is what my friend calls a “bloodbath”. Local brands still trying to survive, while foreign brands are getting the prime spaces, lots of media mileage, bloggers and influencers on their side, and just about all the media space on billboards and traditional newspapers and magazines.
If you still want to be in fashion, think BIG. Yes, think of fashion for the heavy and heavy set. The world is turning obese and diabetic. Sizes will enlarge and prices will come down. Are you ready to adapt?
RESTAURANTS
Just about everyone wants to get into the restaurant business. It is a sexy business, after all. You can invite your friends over; let them pay while you entertain them. Or you can do all your entertaining of business contacts in your own resto and keep the money within the system, rather than giving it to others.
But these days, big investors are pooling monies to buy foreign franchises and expanding these acquisitions in every mall or retail space. Even local brands are forced to expand through franchising just so they can get a share of throat and share of tummy.
If you want to put up a restaurant, you better know how much you are willing to invest. The stakes are high and are getting higher as more brands vie for retail space and the malls do not mind ending leases of those who do not perform according to the sales malls require per square meter.
The forecast is that many restaurants will not survive or at best just make marginal profits. One would be hard-pressed to get a return on investment quickly unless you are really lucky.
CAFES
Even the café business has become expensive to keep afloat. There are just too many cafes, too many choices that one will not be able to get the optimum amount of transactions needed to break even.
What to invest in? Take it outside the mall and outside the city. Chances are you can get better traffic in tourist areas or tourist-heavy cities. Or do custom roasting and custom catering. Something out of the box.
BEING CAREFUL
So entrepreneurs have to be extra careful these days. With WTO retail policies relaxed for the big foreign chains and the ASEAN Economic Community already happening, you may want to choose a business that looks outward to the region and envision to sell something to ASEAN rather than your being taken over by bigger brands.
Think global, act local.
Next, you may want to consider protecting your brand of many years and what you stand for. In the end, it may only be your brand that will survive. Any business model can be replicable and entry barriers will come down.
Protect your brand through registration with IPO. Protect your brand through promotion.
Be agile. Concentrate on being able to morph into another business model if needed.
Diversify. Do not put all your eggs in one basket. If you must be in fashion, invest also in other sectors like food or services.
Know the rules and the laws. How many years does one have in for example, the rice business before tariffs come down? How many years before it becomes open market for your category?
While every confident entrepreneur will say change is already happening, and that ASEAN is already a reality, think again. You may want to know how the ASEAN Economic Community ( AEC) will affect your business.
It is the time for change. Be ready to change and think ahead of the curve.
Not to sound pessimistic but more realistic, we all have to look around us and see what the market wants and what the market is offering right now. How do we get in and find our sweet spot?
It may just be staring you in the face right now. Be aware.
source: www.abs-cbnnews.com