October 14, 2007

Ike Señeres

Small is beautiful in business

It may be an old worn out slogan, but there is still plenty of truth to the saying that “small is beautiful”, especially when it is applied to small business. Old as it is, there could be a new twist to it, particularly if efforts are made to modernize it, with a new intensity and determination that would match the energies of big business.

It is no big breakthrough to speak of, but I think that I have come up with a development strategy that could open the doors for small business owners (SBOs) to succeed. The late statesman Raul Manglapus called it “subsidiarity” (not in the dictionary); I call it “chop-chop” economics. As Manglapus has defined it, subsidiarity is the strategy of subdividing a problem into many manageable parts.

Without necessarily using the same operative term, subsidiarity is actually being practiced as a strategy in software development, as the big problem of developing a large and complex software is answered or overcome by subdividing it into small programming units, later on assembling the small components into one cohesive and seamless software program.

In a manner of speaking, the Japanese auto industry actually uses subsidiarity as a manufacturing strategy, as individual auto parts are made by small companies to be assembled later on in big factories into the bigger finished products. Call it any other name, but the big problem of auto manufacturing is actually subdivided by the Japanese into many manageable parts, which is done by chopping it down into many small units.

Probably after learning some lessons from the fairs and exhibitions industry, a relatively new “commercial space organizer” industry has emerged in this country, an industry that has thrived by leasing large retail spaces and renting these out as small spaces to individual locators or concessionaires. Heading towards this direction, I am now subdividing store spaces in a number of shopping malls and public markets, under the banner of the Alliance of Philippine Rural and Urban Business (APRUB). That is only as far as the urban component is concerned, because I am also subdividing some vacant lands in the provinces into farm lots, for the rural component.

Necessity is truly the mother of invention, because I was practically “pressured” into thinking about store spaces and farm lots after I realized that the people who come to me each day for business assistance will never be able to afford the opportunity of going into retailing or farming, not unless the big costs of going into business in these two industries are chopped down into smaller and more affordable parts. On the practical side, they may not even have the personality to negotiate with the big owners of these properties, hence the need to do it under the banner of an entity like APRUB.

True to the saying that “like feathers flock together”, APRUB has joined with the BAGWIS Responsible Taxi Drivers Association, an organized group of more than 400 members in Metro Manila, for the purpose of putting up modern passenger terminals in selected shopping malls. Thanks to another tie-up with Next Mobile which we have worked out, we are going to give away free radio handsets with built-in mobile phones to these drivers, which will also be joined by other groups of van, FX and AUV drivers. With the passenger terminal acting as the core business, we are also going to include a food court and a repair center next to the core, so that the spouses of the drivers together with other SBOs could operate their own concessions. Using the handsets provided by Next Mobile, the unified group of taxi, van, FX and AUV drivers will have the capability of calling out and dispatching units as they are needed by passengers.

Also an invention that was born out of necessity, the store spaces in the public markets will be leased to SBOs from the rural areas, so that they could have ready urban markets for their produce. In line with the terms of the lease contract, these spaces will be rented out at affordable rates to individual concessionaires, each one with an assigned product to specialize in, as if it is a permanent trade fair where displays are focused on special items. As a way of cutting down the costs of these small concessionaires, APRUB will pay for the salaries of pooled merchandisers, packaged with the monthly rental costs. In order to support them as well, the project will be supported by joint newspaper ads, also included in the packaged costs.


Tune in to “Gulong ng Kabuhayan” on DZXL (558 KHZ) Mon to Fri 6 to 6:45 PM. Join the InterCharity Network. We assist you in starting a small business, in financing and in marketing. Email ike@kaiking.net or text us at 09196466323.Unit 324, Guadalupe Commercial Complex, EDSA, Makati.

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