Expats Guide: How Not to Fail Your Business in the Philippines


The Philippines is open for business for any foreign individual who would like to invest I the country either by building a small brick and mortar shop, starting an online store or outsourcing some positions or an entire department.


Whatever your needs may be, the country’s skilled and talented people can help you achieve great results for your company.


However, please note that according to statistics, 50 per cent of small business close in five years. Do NOT let your company belong in this group.


It is important to remember these things the moment you decide to do business in the Philippines, or most any place in the world.


Know the Local People


Image Credit: Bernard Spragg. NZ

It pays to actually know some people in the country where you want to set shop in. Knowing about the locals in the area would give you access to a wealth of information about how business really works in the country, for example, the relationship between employer and employee, and the expectations of the employees regarding pay and benefits.


If you really plan to start a business, stay in the country a couple of times within a year to observe some traditions that may affect your business like applying for permits and licenses, number of working and non-working holidays, the traffic and the centers for commerce.


Knowing the locals would also give insight on the quirks of the people – what your future employees value, what makes them tick and leave and what can make them stay.


Further, staying for longer periods of time and connecting with some locals might actually help you gain more market knowledge, help with some registration issues perhaps and most importantly gain loyalty and support from new friends.


Learn the Language


Image Credit: Brian Evans

Most Filipinos can speak English with neutral accent well. We understand both American, British and even Aussie accents (although most may need help with some Aussie slang). We can relate to most western (and eastern) cultures. Most of the signage you’ll find around are in English.


However, not all Filipinos are that fluent. There are occasions when you’ll bump into someone who can understand most of what you say and try to respond with some broken English.


If you really want to penetrate the market and be friendly with the locals, nothing endears an expat most than for one to embrace the language and the culture that comes along with it.


Know your product/service well


Image Credit: July Dominique

This is common sense and it is a golden rule for entrepreneurs to actually know their product and/or service whether they are setting it up in a foreign country or in their own.


Making business in a foreign land would also mean studying their market, knowing their policies and tweaking some things that you already know about how the business should run.


Your home country might have a better and quicker way to do things and it may be the best system there is, but do not try to change how things work in your new country just yet.


Observe and tweak along as necessary. There might be reasons unknown to you as to why things work the way they do in that country.


Expats are not discouraged to innovate and improve but as all diagnosis are, it is wise to first find out the symptoms and rule out possible reasons for them before giving treatment. Trying to change the system that work in one country might make things better but your best intentions may cost you a lot of money and time if you approach it the wrong way.


Moreover, learn about local and foreign companies that may be in direct competition with your business. Plan how you can tackle them or differentiate from them for your business to thrive. Be ready and open to changes and adapt as necessary.


Have Enough Capital and Use It Wisely


Image Credit: 401(K) 2012

One of the reasons why you decided to start here is because your money here is triple or even quadruple to what it is worth back home (AUD1 = P34.97 as of writing).


Labour and materials here is also cheaper than in other developed countries.


However, some things imported from western countries may be more expensive compared to what some westerners pay for in their own country.


Your capital, if spend wisely, can go a long way. Set to bold, underline and italicize with quotation marks those two important words “spend wisely.” You may be rich here, but that money may not last if you do not use it well.


Be Open-minded


Image Credit: Hartwig HKD

Starting a business in a foreign country entails much more than just minding the business. As mentioned above, you need to know the culture of the people you will be working with and entrusting your business to.


There will be a lot of differences in attitudes and behavior, motivations and values that both you and your partners and employees need to adjust with each other. Looking at these differences with just your lens might make you feel bogged down and discouraged. Understand that the locals are also adjusting with your own quirks, behavior, attitude may be even the sight of you (some Filipinos need a little time to react when faced with someone who is blonde and blue-eyed).


Try to see the locals especially your employees without bias and judgment. See them as individuals – just as you would not want to be stereotyped by others in your own country and abroad.


Be Very Patient


Image Credit: Marc Cousin

Another trait you should carry on extra is patience. As above, things may not work as you are used to in your home country because you are not in your home country.


Be patient and believe in your product/service, trust your people and move each day with renewed motivation and strength.


The Philippines’ policies, systems and way of doing things may be different from what a foreigner is used to. This can be true with any other country an entrepreneur chooses to invest in. However, as long as one is armed with expertise of the product/service and knowledge about the host country and its people the business has chances of surviving increases.


Further, the Filipino people are ready and able to accept foreign investors  in their country.

Rica J

I am a mother, a wife and a technology loving Filipina who loves reading hi-fiction books (dragons!) , good stories, dancing, laughter, lying on the grass and eating balut. I am born and raised in the Philippines and now resides in Australia but finds myself in the Philippines for at least 3 months a year. I am part of the Filipino Australian Community and have been living between Australia and the Philippines since 2007.


Leave A Comment

Your email address will not be published. Required fields are marked *