Ep. 10 Do you need to set up shop in the Philippines?

Hello, and welcome to the Secret Sauce of Outsourcing Podcast, the podcast that's dedicated to making you better at outsourcing your work. My name is John Jonas, and this is episode 10. Do you need to set up shop in the Philippines? So setting up an LLC in the US is super easy. Anyone can pay a lawyer 500 bucks and end up with an LLC running in, like, a week. And that includes, like, a minor or a foreign citizen or whoever. Anybody can do this. Or you can do it yourself and pay the local state fee of, like, 20 to $100. It's so easy to get it set up. In fact, it's so simple that my kids have their own LLCs for businesses that they run, and I'm not on them. It's not quite so simple in the Philippines. So I got an interesting email recently asking whether you need to set up a company in the Philippines. Like, you apply for a business permit there and set up shop there. And the reason they're asking is that they want to grow their team. A Filipino entity would show that the business is stable and serious, and it might help with recruiting new ofs. So setting up shop in the country shows you're committed to hiring in the Philippines and finding an online Filipino specialist. I seen other people do it, but we do not do this. So here's my experience. Number one, in order to own a business in the Philippines, you have to be a Philippine citizen. It's not like in the US where you just set up an LLC and have to have a registered agent. You actually have to have a Filipino citizen be a part owner of the business. So you gotta find someone there that you can trust. Number two, we tried to do this for like a year and a half to set up a business there, and it was really hard. So much red tape, so many hoops to jump through. Really, really difficult. We had someone on our team working basically full time on it. It sucked. Number three. So here's another experience that I had about 10 years ago. I had a friend who successfully did it. Here's what he did. He traveled to the Philippines. He got, like, $15,000 in cash, in US dollars. He had a team member he trusted to be the citizen owner. He had a connection with someone in the local government. And then he paid his $15,000 to get his business set up in, like, one week. Basically, it was bribe money from multiple people in different agencies to get them to look the other way and. And put him at the front of the list. So then he got an office and outfitted it, which was like another $10,000. He got pictures of his whole team set up in his nice new office space. It was awesome for him. And two years later his business completely changed and he shut it all down. To me it's not worth it. Kudos to those who have managed to do it. We've never pushed through with it. The process was just so long and problematic and in the end it opened up our business to a lot of new, different liabilities that we weren't ready for and we gave up. Now that doesn't mean that you can't show stability and commitment in other ways as you're recruiting Filipino specialist Offering them a full time salary job with paid leave is a really good start. You can also offer your OFS benefits like healthcare or share their SSS and philhealth payments. I'll talk about those in another podcast episode. Giving them a yearly raise and bonuses also shows that your business is stable and you're committed to your employees. So there's no need to overcomplicate things. You don't need to set up shop. You don't need to have a foreign entity. You don't need to do any of that stuff. Want a simple way to find a great online Filipino specialist? Try 1vaoa.com. It's my system and it attempts to make the fastest, simplest, most sure way to find and hire a great specialist in the Philippines. My name is John. Thanks for listening.