In a sense, being here is also a way out of the economic quagmire that is the Philippine home market, one that is an economic hostage to warring politicians. Here, Pinoy entrepreneurs are busy doing business instead of worrying the next political bombshell between Ate Glue and the opposition.
Oishi has been here over 10 years, and is now fighting head to head with large multinational brands in the snack food business, like Frito Lay. With 10 factories all over China, as far north as Manchuria, it is set to open two more.
The other pioneer here among the Pinoy taipans is George Ty of Metrobank. After three years, Metrobank is now licensed to operate as a commercial bank here. But Mr. Ty told me over breakfast last Sunday at the Shanghai Westin, the competition in the banking sector in China is stiff.
But, Mr. Ty emphasized, they are here for the long haul. They are targeting not just the Pinoy workers and entrepreneurs here, but whatever business they could get from other Southeast Asian countries. A branch in Beijing is next in Mr. Ty’s "to do" list.
Metrobank in China is also busy in the real estate market. A new twin tower to be called Metrobank Plaza, is set to rise in Shanghai as the bank’s bet on this city’s very vibrant real estate market. One tower is designed for residential use and the other for offices. Topping off is set for next month and completion of the project is expected after a year.
On the whole, Mr. Ty is bullish about the Filipinos in Shanghai, even as he concedes that doing business in China is not a walk in the park. Doing business here requires not just hard work and determination but a lot of guts. He walks around Shanghai in his barong tagalog precisely because, he said, he wants to dramatize our presence here. Curiously, the other leading Pinoy taipan here, Carlos Chan of Oishi, also proudly flies the Philippine flag in his factories, also to proclaim Philippine presence in China. He has assigned 65 Pinoy expat executives and engineers to run his business here.
The Pinoy entrepreneurs here are not lacking in the guts department. Figaro, the Pinoy answer to Starbucks, has set up two branches in Shanghai. One was opened last March and the other opened last May. Rosario Juan, Figaro’s area manager was glad to welcome our 20-person Tuesday Club group to its very distinctive coffee house in an up and coming trendy area of Shanghai.
The Figaro coffee house does the Filipino proud, that is, if people here even think of it as Filipino. The only hint of its Pinoy origins is a blown up ancient map of the region showing the location of the Philippines as part of the wall décor. Figaro’s upscale international ambience competes very well with Starbucks, but there is no doubt Figaro would need staying power to survive in this market.
Ms. Juan didn’t tell us how much rent Figaro is paying for the spacious coffee shop we visited. But people here estimate they must be paying the equivalent of a million pesos a month for rent. That sounds to me like an awful lot of coffee lattes to sell to cover overhead and make some profit.
Still, Ms. Juan sounded absolutely enthusiastic and optimistic about the Pinoy brand’s future in Shanghai. Business is good, she says, and it could only get better once the new buildings being constructed in the area are done. In any case, the pressure of meeting the challenge of doing business in a foreign land has not caused this 23-year-old entrepreneur/manager any loss of her youthful exuberance.
Another Pinoy brand trying to establish itself here is Bench. On the surface, trying to sell garments in the country known as the world’s foremost producer of garments is like trying to sell freezers to the Eskimos. But it was explained to me that Bench is precisely trying to establish itself as a premier brand that would attract increasingly fashionable and free spending young Chinese yuppies. In fact, I am told that Bench is even manufacturing some of its higher value products in Manila.
I suppose too, Bench is comfortable here because Ben Chan is the younger brother of the man behind the successful Oishi brand of snack food. Then again, Oishi had first mover advantage in the China market, having staked out the market long before the mad rush to China happened. Snack food is also a world away from garments.
To make the big time here, Bench would have to compete with deep pocketed international brands. It seems that for garments, there is no middle ground between being seen as a premier brand and being a mere commodity. I visited a Bench outlet in a mall near the famous Nanjing Road shopping street and it is clear that the brand is in for tough competition. Then again too, if it manages to develop a niche market here, even a small slice of the large China pie should be more than satisfying.
Two other Chinoy taipans are also here in Shinghai. Lucio Tan is building a tower that would include a premier hotel. John Gokongwei’s Universal Robina is also testing the waters for its candies. For these established taipans and as well as for the aspiring entrepreneurs behind Figaro and Bench, it is a struggle to be here in China. But the market is large and the rewards are great once they get over the initial struggle to survive. And I am sure, it beats having to fret about the business climate back home.
This happens during the lunar new year break and during the May 1 break too. Chinese authorities do not sacrifice productivity by declaring unscheduled holidays just because, as in our case, Ate Glue delivered her SONA.
The crazy thing is, we wonder why investors love China. Because Ate Glue still doesn’t get it, the answer is, because China respects its investors. It is as simple as that.
Ate Glue met Dubya at the UN.
Dubya: Our Filipino chef at the White House is a truly good cook.
Ate Glue: Yup! That’s not surprising. We are the best cooks in the world. Even I am known to cook very well… like our last election.
Boo Chanco’s e-mail address is bchanco@gmail.com