Take it from the retail titans–Filipinos ate, shopped, splurged more this year
The signs are unmistakable: the Philippine economy is on the upswing, with consumer confidence reflecting the surge in terms of an improved bottom line for the country’s biggest retailers compared to last year.
It’s not yet a juggernaut; a few businesses still felt the sting of downward sales—for some, ironically during the last half of the year heading toward the Christmas holidays. But the reason most cited is still a net positive overall for the market: increased competition, whether from new homegrown players (as in the case of food) or from the influx of foreign brands into the Philippines (in the case of fashion). In food, however, it was consistently obvious that eating out, especially as a family, remains a premiere Philippine pasttime.
Which would, of course, only mean more options and greater choices, and an ever-growing shopping and spending environment for the Filipino consumer in the new year. Happy days are here again? The shops and malls and markets all over say yes!
By Cheche V. Moral and Alex Y. Vergara
EMAN PINEDA, founder and president of Adora
(Holiday shopping started) surprisingly early. We thought the rush would come Dec. 7, but this year it started much earlier for us. We went on double-digit growth compared to Christmas 2011, but Accounting is still tallying so we don’t have exact figures. I think we did better in 2012 because of better buying and merchandise mix; better training of staff; and better rezoning of the store.
PAUL SY, assistant vice president of Kenrich
International Distributors Corp. (a subsidiary of Primer Group of Companies, distributor of brands like G-Star Raw and Tumi, and owns the stores ROX, The Travel Club and Bratpack)
We continue to enjoy consistent growth, but admittedly not as expected, given the very positive performance of the Philippine economy in general during the last quarter. Nevertheless, all signs still point to even stronger performance for 2013. We expect that the positive effect of a healthy Philippine economy will gradually take effect on the average Filipino pockets this year.
KATSUMI KUBOTA, chief operations officer of Fast Retailing
Holiday shopping at Uniqlo was crazy and remarkable. There were a lot of people in the store and all were busy finding their own stuff.
Filipinos shopped more than we expected in our first holiday here. We know that the Christmas season is crazy in the Philippines, but we were still surprised with what we saw in our store.
ANTON T. HUANG, executive vice president of Rustan’s and Stores Specialists Inc. (distributor of 80+ brands, from Lacoste and Marks & Spencer to Prada and Salvatore Ferragamo)
Figures have not been finalized, but it would be safe to say that holiday sales for the group was higher in 2012 compared to 2011 by at least 15 percent. Holiday shopping, in fact, came in earlier this year. Sales picked up as early as September and were sustained into November and early December, a surprising change, as holiday sales in recent years would usually come in November.
Overall, 2012 was a fantastic year for the Rustan’s Group and SSI. The economic environment was very conducive to private spending—the inflation rate was managed at low levels, interest rates are at their record-lows, and remittances from abroad continued to pour in and register double-digit growth.
MILLIE DIZON, vice president for marketing and communications, SM Group
Our store sales not only for Christmas but the rest of the year were good, and we had good growth. That could be attributed to continued consumer confidence, OFW remittances and BPO businesses. Likewise, 2012 was a dynamic year for us; we opened five new stores, renovated existing stores, had better merchandise, and were more aggressive with our marketing. We also had new global retail partners like Uniqlo that made it more exciting for shoppers.
GEORGE SALUD, general manager, Tango; CEO, Merger
Our direct and online marketing efforts were quite effective in stimulating growth. But sales dropped during the second half of the year all the way to December because of the influx of reasonably priced foreign brands. December comparative sales between 2011 and 2012 dropped by a significant 15 percent. We attribute it to increased competition from merchandise with similar price points.
Trendy, seasonal styles had the fastest turnover, while basic staples did not do as well.
For Merger, our peak season usually begins from November all the way to March. The growth in sales during these months could be attributed to the high demand for formal wear during weddings, Christmas, New Year, prom season, Valentine’s and graduation season.
But, again, sales dropped during the second half of 2012. This could be attributed to the presence of more malls in Metro Manila, resulting in more players and choices. December comparative sales between 2011 and 2012 dropped by a significant 12-15 percent due to increased competition. Sales were better during the first half of 2012.
JAYJAY ONRUBIA PUNO, finance director, and RUBY GAN, COO, ShopManila Inc.
People wanted to be dressed up for the holidays. It’s also good to note that the public is now more aware and willing than ever to buy Filipino. They now have the appreciation for clothes made by local designers. If you haven’t noticed yet, a lot of local designers were tapped to head and design not a few local brands.
We also experienced a sharp increase in the sales of our flip-flop brand Bling Duck during the Christmas season. We attribute this to the fact that the product is very gift-friendly (nothing beyond P500) and functional. For Schu, we saw a demand for reasonably priced shoes (not over P2,000) regardless of brand or origin.
Compared to the same period last year, total sales are not higher because the Christmas rush started later this year. We didn’t experience any growth this year. We had a challenging third quarter and a delayed increase in sales during the fourth quarter.
XANDRA RAMOS PADILLA, purchasing director for books, National Book Store
At National Book Store, our sales grew in the last quarter. Around late November, we noticed that a lot of customers were buying books as gifts. Books sales jumped especially during the weeks before and even after Christmas, as some kids may have used their Christmas money to buy books.
It is very heartwarming that Project Aklat got close to 80,000 books donated by customers, which is a 45-percent increase from last year.
TUACO, CEO, Elite Garments International Inc.
The increased competition has affected some of our stores, which fell below our expectations. The branches with near proximity to newly opened competition showed more modest growth. Thick knit items didn’t do as well as we thought. It’s very easy to wear, but perhaps it was due to our warmer weather, or they may not be as flattering to different body types. Slinky jerseys that are tight fitting also didn’t do as well. On the other hand, loose drapey items did well.
By Vangie Baga-Reyes and Raoul J. Chee Kee
CACHELLE DE ALBA, marketing manager, Alba Restaurante Español
Alba Restaurante Español’s sales slightly increased by around 10 percent in 2012. People are still budget-conscious, but we noticed that people were spending more than they were in 2011. We do hope this trend continues in 2013.
BOB VALLAR, marketing manager, Super Bowl of China
In 2012, some months, we were up by like 5 percent, especially when we had value offer promotions, like our Unli Yang Chow Fried Rice. Basically, people still ate out, but they wanted restaurants they patronized to give them more bang for their buck. So if their budget is like P1,000, they wanted to get a little more than they usually do for that amount.
PAUL MANUUD, chief operating officer of Bistro Group
Bistro Group of Restaurants as a whole posted growth in 2012. We opened new concepts like Watami Japanese casual restaurant and Village Tavern. I believe there was marked increase in the consumption in volume (with a lot of tourists contributing) in the local hospitality and restaurant industry, although there are also many players (with malls and hotels opening). People still ate out and too many restaurants shared the market. We offered group meals across all restaurant concepts with outstanding value for money, and it was a blast.
MARIFI SERAFIN, marketing manager of Papa John’s
For 2012, we registered a growth of 29.5 percent compared to 2011 sales. We have observed that the purchasing power of customers has increased, especially for diners of groups of five or more. Customers indulge when they visit the store. For example, they order chicken and pasta to go with the usual pizza. Most Papa John’s menu items are for sharing, hence it is an advantage.
VICKY PACHECO, executive chef and chief operating officer, 1771 Group of Restaurants
In terms of sales, we remained on target, but 2012 had its ups and downs. We were seriously affected by the weather and flooding. Supplies were limited. We saw a month where people were just afraid to go out. However, toward the last quarter, we recovered approaching holiday season, especially in Chateau with the launch of new menu.
For Sentro, we had a slight drop in numbers compared to 10 years ago, but back then we were the pioneers and the only one serving modern Filipino cuisine. The Café, Wine Bar, and Side Bar at Ortigas were still fairly new concepts, but every year they’ve kept exceeding expectations.
BADJIE TRINIDAD, chief executive officer, Cravings Group of Companies
There was a general increase in sales from 2011 to 2012 of at least 10 percent. We’ve noticed a few things too: 1. Before eating, people now take photos of their food; 2. Sharing dishes or family-style is now acceptable/practiced even in a business dining environment; 3. People are looking for healthier alternatives; 4. More kids eat the same food as adults vs. children’s menu.
RAYMUND MAGDALUYO, chief executive officer of The Red Crab Group
The economy was definitely stronger in 2012, with so many malls and other leisure spaces sprouting in major cities. More people were eating out. Sales for our stores are at least as good as last year and stronger for many areas. However, growth in the economy was tempered by the entry of so many new players. There was a surge in competition. So, this allows us to choose carefully where to go. Much growth has come from our family seafood grill concept, Blackbeard’s Seafood Island. We are now serving not just affluent people, but a good chunk of what we call “asensadong masang Filipino.”
JOHNLU KOA, founder and chief executive officer for The French Baker and board of director, ChaTime
For French Baker, we ended the year with an 8-percent growth. New stores contributed to upsurge in sales. Our presence in new markets, such as Eastwood, Robinson’s Magnolia and our reentry into SM Southmall, helped. Store No. 50 opened at the SM Lanang Premiere in Davao City on Christmas Day 2012. Joint promotions conducted by Fonterra (Anchor) and French Baker boosted awareness of our new product this Christmas, i.e., the Hokkaido cake with fresh cream filling in delightful boxes. Provincial stores did better in terms of growth due to traffic to city and accessibility from home, and restaurants in city malls tend to be overcrowded.
For ChaTime, our 27th store also opened on Christmas Day 2012 in SM Lanang Premiere in Davao City. The popularity of pearl milk tea has not waned. We’ve been building stores with seating to allow customers to stay a while and meet up with friends or surf the net.
MARY ANN QUIOC TAYAG, wife of chef Claude Tayag, Bale Dutung in Pampanga
There were certainly more bookings in December, which is true every year. We have many bookings from abroad, and those from here were by balikbayan or foreign guests, which feels good because the Filipino hosts who book the meal obviously take pride in Pinoy food.
Our Lechon 5 menu (or roast suckling pig served five ways) is traditionally the top-seller, because for Filipinos there must always be lechon. But this December, the Anthony Bourdain menu, which includes a beautifully arranged seafood kare-kare, was the bigger hit because of the bookings from abroad.
MALU GAMBOA, owner, Milkyway Restaurant
Christmas came early this year; we started feeling the Christmas high in mid-November, when the balikbayan began arriving. At first, they came in pairs and trios, but toward Christmas week, the groups got larger and noisier, many of them requesting private rooms for 12-50 people. The balikbayan are still here, but since they are beginning to head back home, January is busy with despedidas (going-away parties).
Milkyway is a favorite first and last stop of the balikbayan who sorely miss Filipino fare. Every table would have the Crispy Hito with Mustasa Salad and Homemade Bagoong, the Crispy Pata from Suckling Pig, the Kilawing Puso ng Saging and Sinigang na Salmon (all shared) and of course, a Halo-Halo, Guinumis or avocado, ube or cheese ice cream (usually not shared) to cap their meal.
BANUSING, Iloilo-based restaurateur
December was impressive in terms of sales. Although it started slowly, most days in December were very strong. I make it a point to greet our guests, and I found out that many of them would rather eat out during the holidays. They said they preferred to celebrate at a restaurant rather than at home, since they get tired of cleaning up their houses after hosting parties, especially when the help goes on leave.
We came up with group set menus for 10-20 for the holiday season that were very popular. Filipinos really love to eat salu-salo (family-style) and I think this makes any gathering more enjoyable.
HIM UY DE BARON,
consultant, East Café, and chef-owner, Nomama
December was significantly better—around 30 percent—than November based on sales at both restaurants.
People didn’t mind spending a bit more (from P75-P100), particularly since 2012 has been a good year economically, and people are optimistic for 2013. As long as the food is good and it’s a good mix of the familiar and the new, then it’s a winning menu.
CYRIL ADDISON, Raintree Restaurants’ director of operations
More parties were booked in December, so the number of covers really went up. We also saw a lot of families, balikbayan, and notably, a rise in foreign tourists on holiday. The days between Christmas and New Year, we saw more couples, ladies-who-lunch and trios of friends.
We witnessed more orders served family-style, where they got from the center of the table and food was passed around for everyone to enjoy. During the holidays, people tended to be more uninhibited as they were surrounded by people they enjoyed spending time with; as a result, they tended to order more. We had a family of seven at Kabila, and they ordered at least two dishes per person. After the hefty servings, they still decided to order another five items for takeout!