Driving Community Development Through Local Establishments
Business giants may control and greatly influence the stock market. But it is Small and Medium Enterprises (SMEs) who make up the majority of registered businesses in the Philippines.
According to the Department of Trade and Industry (DTI), SMEs compose 99.6% of all registered businesses. Yet, despite its large number, collectively, they only make up for just 35% of the Philippines’ Gross Domestic Products (GDP).
Small businesses are deemed as important influencers for growth, keeping the economy on the move. Additionally, SMEs generate competition. Ironic it may seem, because of its small size compared to big businesses, SMEs can implement new ideas, trends, and innovations faster because they can bypass all the paperwork big companies need to do before launching or introducing a new product.
Below are some of the reasons why buying Sorbetes or Ice cream from your local vendor is better than store-bought ice cream. Or try upscaled bags made from local material than luxury items. Or even buying locally made furniture from the locality than cheap international ones.
Drive Force of Local Economy
As SMEs are built to target the local market, these businesses are more likely to utilize other local businesses such as rural banks, service providers, markets, goods, and the like. By doing so, other establishments will benefit from SMEs, further providing opportunities within the community.
Additionally, local businesses that generate high revenue pays higher taxes. This is then used to improve local government-managed facilities like local police, fire department, and schools. Ultimately resulting in the improvement of the community.
Entrepreneur couple Hazel and Robert Cabe managed a one-hectare banana plantation in Quindaponan. There, they experimented on home-based processing of banana chips with 50 kilograms of bananas. After a year in production, the popularity of their company Triple L and their product increased, and business grew. Before they knew it, they were now adding additional employees, selling to 190 supermarket outlets nationwide, and buying additional bananas from local farmers. As a result, they became a steady buyer from banana farmers.
Local Employment
Local businesses help create more jobs, and more jobs mean more people can get employed in the community. Moreover, locally owned businesses in some sectors provide better wages, working environments, and benefits to their employees compared to other large companies.
Bernadette Delos Santos locally known in Camarines Sur as “BidiBidi” is an entrepreneur who sells her art reflected through bags, facemasks, trinkets, and the like which is slowly getting international exposure. Her business employs women residing in the municipality of Baao and teaches them to become embroiders through skills training to help them earn income. Through this, embroiders can now send their children to school.
Trend-Setting
Though small in scale, small local businesses can influence large corporations in various ways. These businesses are innovative and agile in terms of management, where their decision-making process is much faster. With this, small businesses can execute and observe new ideas, equipment, processes, marketing strategies quicker than big businesses. Moreover, small businesses can directly ask and implement suggestions coming from their day-to-day customers. As a result, this greatly impacts the present and standard workplace culture of businesses today.
After years of living abroad, Monina Dela Cuesta Balubayan decided to go back to her home province Laguna in 2013. Thinking that her age is way above the limit to apply for a job she decided to create a small café business. After a few years, she decided to close it down. In 2018, Monina put all her efforts into studying the craft of pizza making.
A lot of people started loving her pizza. With the increase in demand, she added more flavors. Also, she was quick on her toes to add flavors and combinations customers were looking and craving for. As a result, she did not just generate more income but has improved the quality of their products.
Sense of Community
Let’s face it. Food often tastes better when we are somewhere comfortable, what better way to eat in than a place that is managed by someone we know or perhaps someone who knows how to serve their customers in a familial way.
In certain instances, local businesses may become aware of customers’ needs and how they can effectively address them immediately. Being small in scale, local businesses also have the agility and flexibility in redeploying resources and goal redirection.
In the study found in the Journal of Consumer Research, they took a closer look that having the familiarity of customers in business results in fierce loyalty of its customers. This in turn results in enthusiasm and commitment. Thus, loyal customers give higher tips, volunteer, and even go as much as become brand ambassadors of the establishment – convincing people they know that it is an establishment they should visit.
That is why in your next adventure in any city or town, go and support local because who knows, you might hear and learn something from the people and the community
References:
- https://oxfordbusinessgroup.com/analysis/start-small-small-and-medium-sized-businesses-are-core-economy
- https://www.peopleinneed.net/four-stories-of-small-business-resilience-in-the-philippines-7066gp
- https://www.bicolmail.net/single-post/2017/10/05/arts-crafts-make-bicolana-entrep-win-award-from-apec
- https://www.businessnewsdaily.com/15359-importance-of-small-business.html
- https://www.dti.gov.ph/regions/region-4a/region-4a-success-stories/moninas-pizzeria-more-than-just-bread-butter/
- https://phys.org/news/2013-11-familiarity-people-favorite-businesses.html
