by Roy Stephen C. Canivel

The Philippines鈥� car industry remains in a sweet spot.

Apart from sales rising yearly, the sector also recently received government support 鈥� a multibillion dollar financial incentive to help transform the country into a regional auto manufacturing hub.

Understandably, the challenge is daunting, ambitious even.

After all, other countries such as Thailand seem to be a better choice than the Philippines as far as car manufacturing is concerned.

This much is admitted by Rommel R. Gutierrez, first vice-president for Government Affairs at Toyota Motor Philippines.

Take Toyota鈥檚 Vios and Innova models, Mr. Gutierrez said.

While both vehicles are made locally and in Thailand, 鈥渋t鈥檚 cheaper to import vehicles than to produce locally,鈥� he said.

This is because Toyota鈥檚 local unit has no choice but buy more components from abroad, unlike Toyota鈥檚 Thai assembler which sources car parts locally.

鈥淭hailand鈥檚 localization is very high, more than 80% while ours are only at 40%,鈥� the Toyota executive said, adding that the industry will become more competitive if it sources its parts locally.

Program seeks to make cars have more local content

Starting 2010, the Philippines found it more difficult to compete when import barriers were pulled down in member countries of the ASEAN Free Trade Area (AFTA).

Under the AFTA鈥檚 Common Effective Preferential Tariff (CEPT), taxes on imports 鈥� including those previously imposed on vehicles and components 鈥� were virtually removed.

As a result, several auto parts suppliers and some car manufacturers left the country since it was no longer competitive, Mr. Gutierrez explained.

After all, it was cheaper to import cars assembled abroad than it was to build them here.

But now, the government 鈥� through its Comprehensive Automotive Resurgence Strategy (CARS) program 鈥� plans to turn the situation around by increasing localized content to 60% from 40% by 2022.

With locally-built cars containing more parts sourced domestically, companies such as Toyota Philippines 鈥渃an benefit,鈥� Mr. Gutierrez said.

The CARS program, established by Executive Order 182 that was signed by President Benigno S. C. Aquino III on May 29 last year, provides incentives to three car makers to locally produce three car models with a production volume of at least 200,000 units respectively for up to six years, or an average of 33,333 vehicles per year.

The program also provides auto manufacturers and parts makers operating in the Philippines P4.5 billion in annual support for six years, or P27 billion in total, as well as other non-fiscal measures.

For its part, Toyota Motor Corp. plans to invest P3.22 billion ($70 million) in its Philippine division to increase local output and qualify for a new tax incentive. The Japanese automaker will build 230,000 Vios subcompact sedans.

This would help 鈥渃lose the cost gap鈥� between importing and local production, he said, adding that the domestic sector needs to achieve economies of scale, bringing down cost of localization and resulting in more competitive production.

鈥淵ou need to produce a lot because you need to spread the cost,鈥� he said. 鈥淚t鈥檚 not easy, but we are more than willing to take the challenge kasi (because) that鈥檚 the requirement.鈥�

The Toyota executive, who is also president of Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI), said that it has been a year since the 鈥渟tart of motorization,鈥� which he said signaled a spike in total industry car sales reflecting the stronger purchasing power of the local market.

Toyota, Mitsubishi qualify for car program

Toyota has consistently reported the biggest sales in the Philippines, taking 45.12% of market share as of June this year alone, according to a monthly report issued by CAMPI together with the Truck Manufacturers Association.

By 2020, total market sales is expected to reach 500,000 units. However, this may be reached earlier than anticipated since 320,000 units were delivered last year, meeting the 2018 target of 300,000 way ahead of schedule.

As of this writing, only two companies qualified for the program: Toyota and Mitsubishi Motors Philippines. They received their certificates of recognition last June.

The fate of the third player that would help reach the program鈥檚 goal of producing 600,000 units is still unknown.

鈥淲e still don鈥檛 know if we鈥檙e going to open it up,鈥� Trade Undersecretary Ceferino S. Rodolfo told reporters last June while at the sidelines of Mitsubishi鈥檚 groundbreaking ceremony of its Laguna stamping facility.

Manufacturers need to meet 鈥渢he production volume that is needed for the Philippines to surmount the economies of scale and be regionally competitive,鈥� he said.

鈥淚f they are accepted into the program, that does not mean that they will be already receiving the incentives. It depends on their performance,鈥� he told reporters. Incentives would only be enjoyed by the manufacturers after they produce their first 100,000 units.

Meanwhile, as the country鈥檚 consistent top-selling car maker, Mr. Gutierrez says that the growing traffic does not necessarily post a harm on Toyota鈥檚 performance, citing increasing industry growth on the back of solid consumer demand.

鈥淭raffic doesn鈥檛 seem to have an effect on our sales,鈥� he said. 鈥淚n fact, people would rather buy a car than suffer through our public transportation. That鈥檚 the irony of it.鈥�

He also pointed out that car sales in the provinces 鈥� where roads are not as congested 鈥� remain substantial.

A lot of dealerships are now being put in the provinces and, as a result, sales are being dispersed across the region, he said. Sixty percent of its sales are in Metro Manila while the rest are divided among the rest of the areas.

鈥斺赌斺赌斺赌斺赌斺赌斺赌�

Roy Stephen C. Canivel () covers telecommunications and trade for 大象传媒. He likes reading a good book and occasionally checks their summaries on several Web sites.

by听Josielyn Luna-Manuel, Special Features Editor听

It鈥檚 not something every fashionista keeps track of.

But it nevertheless is a worldwide trend that fashion retailers keep tabs on.

It鈥檚 called fast fashion, referring broadly to upscale brands 鈥� 鈥渢he latest fashion from the catwalk of Milan鈥� 鈥� that can be brought, displayed, and hopefully sold by retailers as quickly as possible, said Frances Yu, chief retail strategist at local training and consultancy firm Mansmith & Fielders and former Vice President and Business Unit Head of Rustan鈥檚 Supermarket.

Fast fashion 鈥減resents a level of competition that the local retail industry has never faced in its history of retailing,鈥� Ms. Yu said in an interview. 鈥淸Local retailers] are competing with these international chains that have economies of scale and very excellent supply chain and logistics that can really outperform the locals on all aspects 鈥� from assortment to quality to price to speed, so it would be very difficult for the locals to actually survive that onslaught,鈥� Ms. Yu said.

As expected, fast fashion has intensified competition among retailers.

Fast fashion brands such as Zara, UNIQLO, and H&M not only offer competitive prices and target the same customers, but also bring in the latest fashions to their network of stores in just two weeks, Ms. Yu said.

Moreover, inventories of these brands can be replenished every seven days, she explained, adding that previously, luxury brands were brought home by Rustan鈥檚 and its retail unit, Stores Specialist Inc. (SSI), the Philippines鈥� largest specialty retailer.

鈥淣ewness drives frequency of visits. If your inventory doesn’t change in six months, why should I go there seeing the same display?鈥� Ms. Yu said.

In one way or another, fast fashion may explain why SSI鈥檚 income dropped 54.5% in the first quarter of the year, according to Alexander Adrian O. Tiu, senior equity analyst at AB Capital Securities, Inc.

Based on a 大象传媒 article published last May 14, 鈥渢he Tantoco-led company netted P121.6 million in the three months ending March, down 54.5% from the P267 million earned in the same period last year.鈥�

The income decline was due to 鈥渁n increase in competition in the local retail market, given the entry of UNIQLO and H&M,鈥� Mr.听Tiu said听in an interview in late June.

The cut in SSI鈥檚 net profit was also attributable to either a drop in gross profit margin, its high inventory levels, and the change in lifestyle of its customers, Mr. Tiu added.

鈥淔or the retailer, high inventory levels require the need to drop prices of products or go on sale just so they can let the inventory out,鈥� Mr. Tiu said.

Despite its financial results, AB Capital still has a 鈥渉old recommendation for SSI. We think that the stock is below its fair value,鈥� Mr. Tiu said.

Since foreign brands cannot be stopped dominating and entering the local market, he said that the route should be to focus on other segments that could potentially bring in more revenue.

鈥淲hat you have to do is try to get another pie which is another segment that’s currently untapped. I think that鈥檚 the key for SSI. They’ve been trying to bring in brands from other categories,鈥� he added.

Robust economy boosts retail industry鈥檚 outlook

Overall, these challenges have failed to dampen the outlook in the retail industry.

After all, the Philippines continues to become one of the bright spots in the Asia Pacific Region which foreign brands 鈥渁re looking to tap into鈥hich can help them grow鈥︹�� said said Euromonitor International, a London-based market research firm, in its Country Report titled, 鈥淩etailing in the Philippines,鈥� published in January this year.

The report added that 鈥淸r]etailing in the Philippines is expected to significantly grow alongside the continued improvement in the economy. The increasing disposable income of Filipinos will encourage further purchases of products within grocery and non-grocery categories. The constant exposure to various media sources and overseas travel are also expected to further increase sophistication of Filipinos, which will hasten the growth of local and foreign retail brands already present.鈥�

Similar sentiments have also been expressed by consulting firm Cushman & Wakefield.

鈥淭he strong economic fundamentals and demographics of the country should drive healthy appetite for retail goods moving forward,鈥� it said in a March 2015 report entitled, 鈥淗ow Global Brands are Shaping the Metro Retailer Landscape.鈥� 鈥淩etail competition may tighten as existing brands compete against new retailers for the increasingly sophisticated consumer market and limited available shopping space. However, a healthy shopping mall pipeline and presence of latent demand in other areas of the country should be able to accommodate new retailer entrants to the market.鈥�

Competition to bring out Filipino ingenuity

The healthy increase in retail sales 鈥� which reached $134 billion 鈥� ranked the Philippines 16th out of the 30 countries listed in the 2016 Global Retail Development Index study titled 鈥淕lobal Retail Expansion at a Crossroads.鈥�

Published by global management consulting firm ATKearney in May, it predicted that the country鈥檚 retail industry will soon account for one-fifth of the country鈥檚 GDP by 2025.

That wait may already be too long.

After all, Philippine Retailers Association (PRA) Chairman and Duty Free听Philippines Corporation Chief Operating Officer Lorenzo C. Formoso said that the sector is estimated to increase its share to the country鈥檚 GDP by another five percent to 23-24% this year from 18% last year.

From 2008 to 2014,听 more than 190 new mid-range and luxury foreign brands entered the country, Cushman & Wakefield said. Of this figure, around 123 new brands covered in its report are western retailers. Asian retailers accounted for around 56 of the 190 new brands in the country.

More retailers and more brands is expected to work to the local sector鈥檚 advantage.

Besides promoting dynamic competition, it is also expected to bring out Filipino ingenuity and creativity as well as raise the bar and increase efficiency and performance, according to Mansmith & Fielders鈥� Ms. Yu.

鈥淚t鈥檚 only when your under extreme pressure that you’re able to produce innovation. As the saying goes, 鈥楴ecessity is the mother of invention.鈥� I think for those who will survive, they will find that they have become much better business people or entrepreneurs,鈥� she said.

鈥斺赌斺赌斺赌斺赌斺赌斺赌�

Josielyn Luna-Manuel is a journalism graduate from the Polytechnic University of the Philippines. She believes in the power of kind words and happy thoughts.

By Erika Denise L. Dizon, Special Features Writer

As the entire region waits for the ASEAN Economic Community (AEC) to get in full swing, affecting all sectors of the economy and millions of Filipinos, the accountancy profession is anticipating dramatic changes and implications for their industry.

In 2014, a pact to promote the mobility of accountants within the region was signed by the 10 ASEAN member states. With the ASEAN Mutual Recognition Arrangement (MRA) on Accountancy Services in the works, industry professionals are optimistic that accountants in the region will have better opportunities once the pact is fully implemented come 2017.

鈥淭he challenge is to upgrade and put the accountancy profession at a stage where they have to be globally competitive because we鈥檙e aiming to exceed global standards,鈥� Professional Regulatory Commission-Board of Accountancy (PRC-BoA) Chairman Joel T. Torres said in an interview.

Managing Partner & Chief Executive Officer of Navarro Amper & Co. Greg S. Navarro said local accounting professionals are looking forward to the fulfilment of the MRA. 鈥淚t is still a work in progress. There鈥檚 still many barriers or non-trade barriers that prohibit the free flow of people and skilled labor.鈥�

Mr. Navarro said the Philippines is a top talent source for countries like Myanmar, Cambodia, and Laos that need skilled workers to aid their homegrown accountancy firms. With the AEC, the region becomes almost borderless, making the exchange of talent easier.

Asked about the possibility of having more foreign workers in the Philippines when the AEC comes into effect, Mr. Navarro said this may be viable as local conglomerates see how foreign service providers could offer new perspectives and, in effect, help them put their own firms on a par with companies in the region.

鈥淥n the other hand, let鈥檚 face it, we don鈥檛 pay very well. How do we expect a Singaporean to come here if they鈥檙e going to get less than a third of what they鈥檙e earning? That鈥檚 the constraint,鈥� he said, adding that smaller economies within the region also do not have enough talent to send abroad.

INDUSTRY GROWTH

Still, the country鈥檚 accounting industry has continued to expand, which industry experts attribute to the sustained growth of the economy.

鈥淎s a professional services firm, we basically serve the business communities. If business is good, then it follows that our performance is good,鈥� Mr. Navarro said, adding that his company has experienced double-digit growth.

In the past five years, Navarro Amper & Co., the local practice of the Deloitte Touche Tohmatsu Limited Global Network, has seen a 12-15% rise in revenue.

Meanwhile, Roberto G. Manabat, Chairman and CEO of R.G. Manabat & Co., Philippine member firm of KPMG International, said his company鈥檚 performance in the last three to five years was 鈥渆xcellent鈥� as its annual compounded growth rate grew by double digits or more than 11%.

鈥淚f you benchmark our company鈥檚 performance against the Philippine economy, I鈥檇 say we are doing good,鈥� said Mr. Manabat.

One facet that is still lacking, however, is the industry-wide implementation of a Quality Assurance Review (QAR) program, PRC-BoA鈥檚 Mr. Torres said.

Now categorized under the commission鈥檚 key priorities through its 鈥淓xpanding Horizons (EH)鈥� initiative and a major development in itself, the QAR aims to keep local auditors to their toes as it will regularly monitor the quality of their outputs.

鈥淢aybe in a matter of months, it鈥檚 just probably another notch to exceed global standards. With this and other projects being put in place, I think we will now be in the position to hurdle that. There are more than 100 projects in that [EH] strategic plan. That can be the starting point,鈥� Mr. Torres added.

The EH agenda is a six-point plan for the local accountancy profession. The strategies include instituting quality and governance measures; effectively regulating the profession; enhancing image and reputation of accountancy; enhancing stakeholders鈥� involvement and cooperation; instituting structural changes; and providing communication and assistance mechanisms

BRAIN DRAIN

But 鈥渂rain drain鈥� or the emigration of skilled people from a particular country is a serious hurdle to the future of the accounting profession in the Philippines, the industry officials said.

Mr. Torres said there is an ongoing shortage of accountants because demand for these skilled workers spans from national to worldwide. He said many of the Philippines鈥� young accountants go to the United States, Europe, and the Middle East to look for higher-paying jobs.

鈥淲e hope that there can be a reverse drain that will arise,鈥� he said.

To prevent homegrown talent from going out of the country to practice their profession elsewhere, Mr. Torres said the industry should come up with the proper business climate and offer competitive salaries.

Navarro Amper鈥檚 Mr. Navarro said: 鈥淵ou really have to improve the economy and have inclusive growth. Even with the impressive growth, it does not really trickle down as we still have a lot of joblessness. The jobless rate does not really move too much so that鈥檚 still a challenge.鈥�

The nation鈥檚 perennial problems of infrastructure, peace and order, sluggish internet connections, level-playing field, and traffic, among others, also hinder the industry鈥檚 growth prospects, as well.

鈥淭he constraints will be the constraints in the Philippine economy,鈥� R.G. Manabat鈥檚 Mr. Manabat said. 鈥淲hen those have been addressed, everything will flow smoothly.鈥�

Erika Denise L. Dizon (@erikadzn on Twitter) finished BA Journalism from the University of Santo Tomas.

By Keith Richard D. Mariano, Reporter

On several occasions, President Rodrigo R. Duterte has suggested that Algebra and Calculus be taken out of schools鈥� required curricula.

The president鈥檚 suggestion 鈥� proposed during one of his many moments of levity 鈥� was based on his experience of spending seven years, instead of the usual four, in high school where he hardly passed any of these two subjects.

鈥淚鈥檒l take out calculus. You all went through high school 鈥� what did you learn from calculus, trigonometry? Algebra should be replaced by Business Math,鈥� said Mr. Duterte, who managed to graduate from law school, pass the bar exam, and even become a prosecutor.

Although he appears to be cracking a joke, his proposal to do away with algebra and calculus may make sense in a country of jobless and underemployed people.

In a survey conducted in January, the Philippine Statistics Authority found 2.47 million unemployed Filipinos another 7.88 million underemployed. They accounted for more than a fourth of the country鈥檚 42.5 million labor force.

鈥淲e are so obsessed that a person must have a four-year degree before he鈥檚 worth anything,鈥� Philippine Franchising Association Chairperson Emeritus Samson C. Lim said in a July 7 interview.

Mr. Lim, dubbed as the father of Philippine franchising, runs the Canadian Tourism and Hospitality Institute in the Philippines, a vocational school that offers one-year diploma and one-month certificate courses.

鈥淲e can train the person and in one month, we can get him an on-the-job training in a five-star hotel and my student is practically preferred over students who graduated with a four-year degree from a university,鈥� Mr. Lim said.

The vocational school boasts of meeting international standards, a selling point that came in handy with the foreign education brand Mr. Lim brought to the Philippines through franchising in 2011.

The Canadian Tourism and Hospitality Institute is a franchise of the Canadian Tourism College, a private college established in Vancouver in 1980 to offer hospitality, tourism, airline and adventure programs.

Currently, the vocational school has 150 students enrolled in diploma courses and 300 in certificate offerings.

Mr. Lim ventured into the education business with a question that may have 鈥� more or less 鈥� prompted Mr. Duterte to push for an education free of algebra and calculus.

鈥淔or a developing country, what are the needs, what are the types of people that we need, what are the skills that we need to teach them. I think we have to focus on that,鈥� Mr. Lim said.

鈥淪o, when I send you my students, on day one he is working already. He can work, you can put him in a front office, you can put him in a restaurant, you can put him in housekeeping, in the sales, telephone and what have you.鈥�

Win-win situation for employers, workers

The need to acquire skills rather than a college diploma is creating interest from foreign education brands to expand into the Philippines and, at the same time, providing opportunities for Filipinos looking to have a business.

The Philippine has around 1,500 local and international franchise concepts, about half of which are in the food and beverage sector, U-Franchise Sales & Management President and Francorp Philippines Senior Vice-President Sam Christopher Lim said in a June 23 interview.

鈥淔ood is food 鈥� people will always be interested in food 鈥� but education is the next wave,鈥� the younger Lim noted.

Education franchise brands in Singapore, in particular, are looking to expand into the Philippines and other Southeast Asian countries, Franchising and Licensing Association (Singapore) Chairman Donna Lee said in a June 23 interview.

Ms. Lee, who founded the KinderGolf franchise, noted the franchise concepts are mostly in the area of enrichment aside from skills development.

鈥淲hen I came back from Singapore, I found this seriously addictive math. It鈥檚 teaching math in a new way 鈥� they actually give you a certain item you can relate that equation to, so that instead of just using your mind, you are using your eyes and other senses,鈥� Mr. Lim said. 鈥淭he problem there now is because they鈥檙e teaching these new math systems now in [Philippine schools], the parents or the grandparents like us can no longer tutor them because we don鈥檛 know how that works.鈥�

Businesses offering enrichment programs will supposedly become increasingly important. And a foreign brand will make it a profitable venture.

鈥淢ost of my students are children or niece or nephews of OFWs [overseas Filipino workers]. They see the value of vocational schools, the value of an international diploma,鈥� Mr. Lim said.

Keith RICHARD D. Mariano (@kdmariano on Twitter) covers the Philippine Stock Exchange and the Securities and Exchange Commission for 大象传媒. On weekends, he tries to get some sleep and/or see controversial films.

Only two bars in the country made it to Asia鈥檚 50 Best Bars Awards by Drinks International, ABV (ranking at 14) and The Curator (ranking at 16) , both located in Makati. Oddly enough, both of the publicity-shy watering holes are hidden behind other establishments, making them to a certain extent reincarnations of the speakeasy, the secret bars that plagued Prohibition-era authorities in the US while blessing tipplers in the 1920s.

While speakesies began in the 1920s and the early part of the 1930s as a necessity (at least, from the perspective of a drinker), these days, speakeasies are now just for fun, creating an atmosphere of mystery and concealed glamor to accompany excellent drinks. If you鈥檙e breaking the rules, might as well look good doing it, right?

Of course, modern speakeasies bank upon the novelty and the surprise of having a bar concealed by a more prosaic establishment, such as say, a hotdog joint (as in the case of ABV). So how do you earn money in keeping a secret, as well as sustaining the growth and the glamor once the secret鈥檚 out?

大象传媒 interviewed Pylon Partners, Inc. CEO and Founder F. Patrick Cuartero during the launch of one of its e-commerce platforms, bevtools.com. Pylon Partners is also the parent company behind ABV, so in terms of expansion and diversification, ABV, through its parent Pylon Partners, has that part down pat. Mr. Cuartero describes Pylon as a venture builder, telling 大象传媒 about 13 other food and beverage establishments in the planning stage, as well as five e-commerce companies, and a digital marketing creatives company. Soon, Pylon plans to open a bar in Boracay, as well as a bar in Kuala Lumpur. According to him, the Kuala Lumpur bar will be in a similar format as ABV, 鈥渂ut more grand in scale.鈥�

ABV only opened last year, and as speakeasies were wont to do, was kept a secret for a while, holding private parties in its premises before going public. 鈥淓ven… the press… we鈥檇 push [them] back for the first three months,鈥� he said.

鈥淲hile this is secret, if you give a person a really great experience, nobody鈥檚 ever going to want to keep it secret… that鈥檚 kind of how we grew. People just talked about it,鈥� he said. 鈥淟iterally, in my phone, I sent 12 text messages,鈥� he said, reminiscing about the first few parties that started it all.

Meanwhile, The Curator doesn鈥檛 quite identify as a speakeasy 鈥� for one thing, it does serve coffee while the sun is up. Evenings are a different story altogether, with drinks crafted after cars, and other whimsies. For one thing, the place that conceals The Curator happens to be a wine bar, so boozing at this place was never exactly out-of-bounds. 鈥淚 think it鈥檚 because people need to brand [us] as one, to [understand it],鈥� said Jericson Co, Curator cofounder.

鈥淭he hidden part is not because we wanted to be cool… making money is cool; having a sign is cool 鈥� it鈥檚 just because this is the rent that we could afford,鈥� said Mr. Co.

When 大象传媒 arrived for its interview late in June, renovations were under way to convert the wine bar into the coffee shop-side of The Curator 鈥� like making an honest person out of it, at last.

There are some commonalities between the two bars: aside from both are hidden, they have very little in line in terms of marketing. Said Mr. Cuartero, 鈥淲e plan by… intentionally not marketing,鈥� he said of his marketing plans.

鈥淭he way we do market though, this鈥檒l be very honest, we market to the international crowd outside of the Philippines… honestly speaking, it [has] worked… people who… come in from Singapore, first place to visit. We have regulars from San Francisco, first place to visit. Literally, right off the plane, they bring their bags here 鈥� it鈥檚 pretty awesome.鈥�

Mr. Co, meanwhile, guffaws at his marketing budget, ranking in at about P5,000, instead relying on word-of-mouth. As with Mr. Cuartero鈥檚 case, Mr. Co also has international clients, recalling trips to New Orleans and Singapore to promote the bar. Mr. Co also has a system of thank-you cards that customers can give to a friend to receive a free drink, and then recalling that one of the cards came back to them 鈥� from London.

As well, neither of the two bars accepted sponsorships from external companies (so yes, no cigarette-company ashtrays here, and neither are posters of branded drinks). Said Mr. Cuartero, 鈥淣o 鈥� they tried, in the beginning; we took everything away… that鈥檚 the easy way out… my whole thing is, if we鈥檙e going to build a lasting brand, I want to make sure that ABV is at the forefront, not other people鈥檚 brands.鈥�

Meanwhile, Mr. Co said, 鈥淚t loses some of the independence… I want to sell alcohol based on its merit, rather than its branding. That鈥檚 our perspective.鈥�

When the boys say alcohol, they mean it. The liquor behind the bar is like an adult version of a candy store. No supermarket brands here: in ABV, for example, Mr. Cuartero lists absinthes sourced from the US, France, Germany, and Switzerland, while The Curator boasts of rare whiskeys and odd additives (think liqueur extracted from violets).

Mr. Cuartero says that some of his bottles are sourced from trips abroad, as well as having some guests bring them a bottle, 鈥淏ecause they know that we鈥檙e really into it, which is really endearing, and I love that.鈥� Meanwhile, Mr. Co said, 鈥淭here [are] several companies that bring it in now; it鈥檚 getting more and more available.鈥� Both serve cocktails priced at a premium: while Mr. Cuartero鈥檚 drinks jump between the P300-P600 levels, Mr. Co keeps his at a steady P450, figuring out the price of each cocktail via food-costing measures.

The business might sound shaky to some: inconsistent sourcing, little or zero marketing plan and budget, no sponsorships, and a deliberate concealment, but then, they made it. According to Mr. Cuartero, after opening last year, they have, 鈥淢aybe, a few more months to go,鈥� before breaking even on ABV鈥檚 capital, and then pointing out that he average time it takes for food and beverage establishments takes about 30 months. Mr. Co says that his bar has broken even, being founded in 2013. It added of course, to their appeal, the novelty of discovering something new, but this is no longer the case for neither, seeing as the jig is up and everybody (at least, everybody in the know) knows about them. 鈥淭he hidden part was great for marketing when it started… [but] it鈥檚 not what鈥檚 going to keep customers coming back,鈥� said Mr. Co.

So what does keep these two afloat? 鈥淔or us, the focus is really making sure that [that] experience鈥檚 is top-notch, or memorable, or top of mind,鈥� said Mr. Cuartero.

Said Mr. Co,鈥漁ur idea is if you do something well, if you do it better than anyone else… if you do things that are interesting that [have] a voice, that voice will find its way out.鈥�

Joseph L. Garcia (@josephjlgarcia on Twitter) covers the food and fashion beats for 大象传媒. He usually has a drink in his hand. 大象传媒 Researcher Jochebed B. Gonzales (@jochebedgon on Twitter) helped provide data to the infographic.

The long anticipated ASEAN Economic Community (AEC) finally came into force on Dec. 31, 2015. Its establishment — which has the intention of turning ASEAN (Association of Southeast Asian Nations) into a single market and production base in which, goods, services, investments, skilled labor, and movement of capital flow freely — unlocks tremendous opportunities, as well as challenges, for the 10 member countries of the trade bloc, which includes the Philippines.

At the recently concluded 大象传媒 Economic Forum, held on July 12, several issues surrounding the AEC were discussed by two of the most prominent personalities in the Philippine private sector 鈥� Ramon R. del Rosario, Jr. president and chief executive officer of PHINMA Corp. and Riza G. Mantaring, president and chief executive officer of Sun Life Financial Philippines. Their exchange of views on integration was moderated by Regina Lay, anchor and executive producer at Bloomberg TV Philippines.

Jobs mismatch

The AEC, as Ms. Mantaring remarked, is a huge market.

It is worth approximately $2.6 trillion and is populated by some 622 million people.

But the Philippines needs to be competitive for it to take full advantage of the enormous possibilities of the AEC. Fortunately, Mr. del Rosario noted that there are many factors that have set the stage for the country 鈥渢o be potentially a much more competitive site for investments.鈥� Among these are the rapid economic growth, increasing population and rising labor costs in neighboring countries such as China. He also disclosed that Japanese investors are taking a closer look at the country鈥檚 manufacturing sector 鈥� an important development since, he said, investments in that sector lead to job creation.

There is, however, a skills mismatch that both Ms. Manataring and Mr. del Rosario raised. There doesn鈥檛 seem to be a shortage of Filipinos looking for jobs and yet the number of jobs that goes unfilled is large.

鈥淚t is really a mismatch that we in the business community have to be vocal about. We have to speak up. We have to participate in the effort of addressing that gap,鈥� Mr. del Rosario said. The specific steps the community could take, he said, include defining the competencies and skills they want from graduates and getting involved in the formulation of curricula and courses in schools. 鈥淭he important point is there has to be better communication between industry and academe so that the output of academe matches the expectations and needs of industry,鈥� he said.

Securing permits takes forever

In addition to the mismatch, the country has a lot of work to do to develop an environment in which businesses can thrive. 鈥淚t鈥檚 very difficult to do business here,鈥� Ms. Mantaring said. 鈥淛ust to get a permit, it takes forever.鈥�

In the Doing Business 2016 report of World Bank, the Philippines ranked 103rd, a decline from its 95th place finish in 2015. It was behind Singapore (1st), Malaysia (18th), Thailand (49th) and even Vietnam (90th), but it was ahead of Indonesia (109th).

Ms. Mantaring also called attention to high corporate taxes imposed on private firms, which are among the highest in Southeast Asia.

鈥淚f you鈥檙e a company鈥� if you want to build strong manufacturing capabilities, why would you locate in the Philippines when you can operate much more cheaply and efficiently elsewhere?鈥�

For his part, Mr. del Rosario said: 鈥淚 think it鈥檚 important to point out that we are making some progress.鈥�

He said, for instance, that the country is used to being seen as a 鈥渧ery corrupt nation,鈥� but it has gained a lot of ground in altering such perception. He also noted that the National Competitive Council of the Philippines has been addressing the difficulties in doing business in the country and has made progress in eliminating as much red tape as possible, for instance.

The business process outsourcing industry (BPO) in the Philippines is an exemplar of what a good partnership between the private sector and the government can engender. Ms. Mantaring said that what has made the industry succeed is a combination of private investments and the enabling environment courtesy of the government. 鈥淚f we were able to do it for BPO, there鈥檚 no reason why we can鈥檛 do it for other industries,鈥� she said.

Francis Anthony听T. Valentin (@iamfrancistv) joined 大象传媒 as a special features writer in 2014.

By Michael Angelo S. Murillo, Reporter

Volleyball is no longer an emerging sport.

For the past decade, it has become one of the Philippines鈥� mainstream sports, attracting not only players and fans but businesses as well.

Thanks to its popularity, companies have capitalized on volleyball鈥檚 viability as a platform for sponsorships and promoting market awareness.

鈥淰olleyball has moved beyond being an emerging sport and is now very popular and things are looking up as everybody is on board. From the schools, suppliers, sponsors and other stakeholders, everybody wants to be part of it,鈥� said Jose A. Romasanta, president of the Larong Volleyball sa Pilipinas, Inc. (LVPI), the national sports association in charge of volleyball.

Local volleyball gets global recognition

With local volleyball in the 鈥減ink of health,鈥� the LVPI official said that international volleyball governing bodies have recognized the efforts of the local association of the sport.

鈥淥ne key result of volleyball鈥檚 resurgence in the country is the recognition that we are getting from the Asian Volleyball Confederation (AVC) and the International Volleyball Federation (FIVB or the F茅d茅ration Internationale de Volleyball). Prior to this we did not have such kind of support,鈥� said Mr. Romasanta, also the first vice-president of the Philippine Olympic Committee.

鈥淭he organizations have recognized the organizational structure that the country has with volleyball and the tremendous activity presently happening here and they want us on board as they see us an asset. Which is why we have been granted hosting duties for events and we have been given good feedback,鈥� he added.

Later this year, the Philippines will host the Asian Women鈥檚 Club Volleyball Championship in September and FIVB Volleyball Women鈥檚 Club World Championship in October, which are opportunities, Mr. Romasanta said, to further boost the sport鈥檚 popularity as well as showcase the phenomenal drawing power it has built in the last several years.

V-League started by basketball stakeholders

Talking about the growth of local volleyball will not be complete without the mention of the Shakey鈥檚 V-League, whose establishment was instrumental in further boosting the sport鈥檚 awareness.

Established in 2004 by a group of people who, interestingly enough, were more associated with basketball, the V-League has done more than its fair share in promoting the sport.

鈥淲e are now on our 13th season. The V-League was actually formed by basketball people. The late Jun Bernardino, Moying Martilino, Ricky Palou, Chito Loyzaga, Sonny Barrios and Norman Black, they were the founding members,鈥� said Shakey鈥檚 V-League long-time Commissioner Tony Boy Liao, recounting how the league began.

鈥淭hey started a basketball league, the inter-high school league, but it did not do well because we already have so many basketball leagues. Ricky Palou then suggested to the group why not go into volleyball so they asked me to join and be a commissioner,鈥� he added.

The V-League began as a women鈥檚 collegiate league with teams coming from the University Athletic Association of the Philippines (UAAP), National Collegiate Athletic Association (NCAA) and the Cebu Schools Athletic Foundation (CESAFI).

Corporations welcome

In 2011, it began to welcome corporate and non-collegiate teams which furthered its fan base while also giving participating teams exposure to whatever products they want to promote.

Among the corporations that played or still playing in the league include Kia, PLDT, Maynilad, Smart Communications, Sandugo, and Fourbees.

Club teams include the cities of Davao, Laoag and Baguio, the provinces of Iriga and Cagayan Valley, Philippine Army, Philippine Navy, Philippine Coast Guard and Philippine National Police.

Among those who recently competed in the Shakey鈥檚 V-League Open Conference were University of the Philippines, National University, Baguio, Iriga, Laoag, Philippine Air Force, Bali Pure, and Pocari Sweat.

League officials said the Shakey鈥檚 brand, too, has become synonymous to volleyball and its success.

Mr. Liao did not provide figures on how the league has grown in 13 years but he did mention that it can be gauged at least in two ways 鈥� demand for tournaments that they put up, number of teams which want to join, and the extensive television coverage they have been getting.

鈥淲hen we started, we only had one conference then two conferences and now three, so that鈥檚 one way it has grown. Before we were being covered by two channels now we are with ABS-CBN and being covered live and on prime time, and that is success for us,鈥� the V-League commissioner said.

Mr. Liao also added that the league has also become a venue where collegiate players, both female and male, can go after and continue playing while earning a decent living.

Following in the footsteps of the Shakey鈥檚 V-League in helping grow the sport of volleyball is the Philippine Super Liga (PSL) which was formed in 2013.

A semi-professional corporate club volleyball league, its team members include Cignal TV, Inc., F2 Global Logistics, Inc., United Asia Automotive Group (Foton), Petron Corp. and ARC Refreshments Corp. (RC Cola), among others.

Much like the Philippine Basketball Association (PBA), the PSL provides its teams an advertising platform.

Philippine Super Liga games are being broadcast by Sports5.

Ticket sales, TV ratings go up

Interest in volleyball has also increased in the collegiate level where it has been one of the marquee events, particularly in the UAAP.

During game days, gate receipts of volleyball have, at times, beaten those of basketball and even those of the PBA, insiders said.

Moreover, television ratings of volleyball games have been 鈥減henomenal,鈥� proving that volleyball indeed is now a mainstream sport.

ABS-CBN Sports, the sports division of media conglomerate ABS-CBN Corp., has benefited from the reception that its UAAP broadcast portfolio 鈥� including basketball and volleyball 鈥� has been receiving from the audience.

鈥淭he UAAP is a prime broadcasting property for ABS-CBN Sports because it allows us to draw new audiences. That鈥檚 valuable to a broadcaster. Every new audience that you able to draw into your network is in the long run will help in the total balance of viewership,鈥� said Dino Laurena, ABS-CBN Integrated Sports head.

No figures were provided but in the financial statement submitted by ABS-CBN to the Securities and Exchange Commission for the first six months ending June 30, 2015, 鈥淭otal revenues of narrowcast and sports was up by 25.7%,鈥� which it describes as a significant increase.

Over at the NCAA, owing to the sport鈥檚 popularity, volleyball has been made a mandatory sport along with basketball, swimming, and athletics.

鈥淭he NCAA鈥檚 goal is to increase participation not just in a few sports but all and the NCAA plans to make it all mandatory sports in the future. It started with volleyball first because all schools are already active when it comes to volleyball,鈥� said Season 92 Mancom member Peter Cayco of Arellano University of the league鈥檚 decision.

Beach volleyball also on the rise

Volleyball鈥檚 ascent as a sport of choice for Filipinos is not only confined to the indoor variant as it has already spilled over to beach volleyball which is also on the rise.

A number of organized beach volleyball leagues have been established in the last couple of years, including by the PSL, which counts among its competing teams Sporteum Philippines (Accel), Benguet Eletric Cooperative, Cignal TV, United Asia Automotive Group, Inc. (Foton), Gilligan鈥檚 Restaurant, Manila Electric Co., Petron, Federated Distributors, Inc. (Philips Gold), F2 Global Logistics, Inc. and ARC Refreshments Corp. (RC Cola).

The latest entrant to the burgeoning beach volleyball scene is Beach Volleyball Republic (BVR), an organization formed last year by former Ateneo female volleyball players. Among BVR鈥檚 mission is to further the development and growth of beach volleyball in the country.

And in just short a time the group is happy of the inroads that it has made with the tournaments it has set up done in partnership with the likes of ABS-CBN, PLDT, and the SM Group.

This is apart from the tie-ups it has made with local sponsors in places it is staging its events like Boracay, La Union, Negros Occidental, and Cagayan.

鈥淲e are happy to partner with BVR and other volleyball leagues. We are always interested in showing emerging sports. It鈥檚 a natural progression that we go to beach volleyball,鈥� said Jojo Neri-Estacio, ABS-CBN Sports+Action channel head, of their decision to add BVR in their portfolio of sports.

鈥淚ndoor is already organized and we want beach volleyball to also grow. It also complements our portfolio of sports and we also believe it will also help others outside of Metro Manila,鈥� she added.

Bullish under Duterte

With the popularity of volleyball growing by leaps and bounds, the challenge now is how to sustain it and grow it in turn.

鈥淰olleyball鈥檚 financial sustainability is not a problem [moving forward] as everybody is interested in it,鈥� said Mr. Romasanta.

What is important now, according to the LVPI president, is how the growth of the sport is being 鈥渘ourished,鈥� including getting new talents which, at the end of the day, are its prime commodities.

鈥淭he PSL and V-League have complemented the growth of the sport by exposing it to more people. But new talents should be cultivated so as to make player turnover more seamless,鈥� Mr. Romasanta said.

鈥淓xposure should also move outside of Metro Manila and Luzon to areas in the Visayas and Mindanao. Grassroots development of the sport also has to be promoted in a far-ranging scale,鈥� he added.

Mr. Romasanta also expressed bullishness that volleyball鈥檚 growth and popularity would be sustained under the administration of President Rodrigo R. Duterte.

鈥淪ports in general should get further support under Duterte as he is a sportsman and recognizes the importance of sports in the development of the well-being of people as attested by what he has done in Davao,鈥� he said.

For its part, the Shakey鈥檚 V-League remains committed to continue what they have started 鈥� promote volleyball and bring competition that that every stakeholder, from the fans, sponsors and teams, will appreciate and enjoy.

鈥淭his is where it all started. Before volleyball was not given much attention but now it is almost at par as far as following and interest go with basketball. Volleyball is here to stay,鈥� Mr. Liao said.

Michael Angelo S. Murillo (@bakel3210 on Twitter) is a 大象传媒 reporter who also writes a column about sports. He also covers lifestyle and motoring events every now and then.