John Jonas explains sari-sari stores, the neighborhood micro-shops that dominate Philippine retail. They account for 70% of manufactured food sales and contribute 1.3 trillion pesos to GDP by selling items per piece, extending credit, and serving as social hubs where US convenience stores never took hold.
Questions this video answers
Episode 210.
December 5, 2022.
About 70%.
About 1.3 trillion Philippine pesos.
Chapters
Welcome to the Secret Sauce of Outsourcing podcast that's dedicated to making you better at outsourcing to the Philippines. This is episode 210, the convenient sari Sari Store. So this is a fun piece of Philippines culture. So for me, in the US, what comes to mind when someone says a convenience store is I think of a gas station store like seven eleven, and they have seven elevens in the Philippines too. And actually they help have a lot of seven elevens in the Philippines. But the purest version of a convenience store in the Philippines looks nothing like 7 11. It's actually a sari sari store. Now I don't actually know how to pronounce the word sari sari. It's spelled S A R I S A R I. So in Tagalog, the word sari sari means variety or sundry. And in a sari sari store you can buy just about anything from like canned food to mobile data and everything in between. And it's all in really small convenient packs. You can, you can also buy things per piece like gum or candy or razors or feminine hygiene products. And then sorry sorry stories are everywhere in the Philippines. So whether you're in Metro Manila, downtown, or you're on a remote island, you can always count that there's going to be a sorry sorry store somewhere close by, probably within a block or two. And one of the reasons for this is because they're super cheap and easy to set up. So most of the things you're going to sell can be bought at a big box store like a grocery store, and you can just buy a few of them, bring them home, unwrap the package and sell individual pieces. And you don't really even need a store. You don't have to build anything to have a sorry sorry store. Just set up a table outside of your house and put your stuff on it and you have a business. So sorry sorry stores really kind of hold an important place in like social and economic life in the Philippines. It's a place where people gather. It's a place where they get their basic needs like food or first date or even banking. You can do banking stuff or manage your phone's data. And at a sorry sorry store, it's also a place where people can rely on when times get hard, partly due to the low prices and then second due to the fact that a lot of store owners are willing to let you buy on credit. So you're having a hard time right now. You come to the sorry sorry store you already Know the people because you live a block away. You go there every single day, and they'll let you take some things and then pay them back later so you have a. A credit account with them. All of this is why the sari sari store is the most common type of business in the Philippines. Sari sari stores account for like, 70% of the sale of manufactured food products in the Philippines. It also contributes like 1.3 trillion Filipino pesos to their GDP. And then a lot of successful business owners started by starting a sari sari star. Like, that's where they learned to run a business. Here's another interesting piece about Sorry Sorry Stores is. So we tried to set up a business in the Philippines. It was really difficult. Every time we've suggested it, everyone on our team is like, oh man, you're gonna have to do this and this and this and this. And it's really not easy. And there's a lot of regulation. But with these stores, you're supposed to register it just do all the same things. But oftentimes they let it slide because Sorry Sorry stores provide such a. Such a big social and economic benefit to the community. A successful store will encourage competition. Other people will set up stores. They'll also set up complementary businesses like a barber shop or food stalls. Or even in some cases, a successful store can kind of transform a neighborhood area into a commercial area, forcing other businesses to get registered and pay taxes to the government. It's really an interesting dynamic. And this isn't super unique to the Philippines, but it's definitely different from the US Where I live, and I've only been to the Philippines once. But I remember going into a Sorry Sorry store and thinking, wow, like, you can buy just about anything here. It's just one or two. Instead of like our Costco, where you can buy very few things and you have to buy 60 of them. Yeah, we're pretty wasteful in the US.
