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real stories on Cebu's business landscape…

Resort completes P8.5M facilities

Sun.Star Cebu <> Saturday, March 28, 2009

BY NANCY R. CUDIS, Sun.Star Staff Reporter

WHILE travel and tourism markets are threatened by the global financial crisis, San Remigio Beach Club (SRBC) has invested on new facilities to accommodate more educational activities, corporate meetings and special occasions.

The sports and leisure resort invested P8.5 million in these new facilities—P6 million for two convention centers with a combined capacity of 500 persons and P2.5 million for the four dormitory rooms that can accommodate up to 14 people each—as it focuses on educational and corporate events. The new facilities were opened last March 21.

SRBC general manager Mark Anthony Ynoc said that the resort wants to cater to big groups that will hold conventions, seminars and training workshops for corporations, religious groups and even political parties.

“We also want to cater to special occasions, like weddings, and educational activities like summer camps,” he told Sun.Star Cebu.

The SRBC—which sits on a 7.5-hectare property in Tambongon, San Remigio in northern Cebu—houses 50 bedrooms. The resort began operations in 2002.

“Our vision is to be a prime leader in hospitality up north (of Cebu). We want to be a (tourist) destination, being looked at the way (tourists) look at Malapascua or Daanbantayan,” Ynoc said.

After the completion of the new facilities, SRBC plans to take a “breather” from similar investments this year.

Ynoc admitted that the resort began to feel the effects of the global economic turmoil last month, with the decline in local and foreign guests.

“While (individual) travelers would cut back on luxury expenses like travel, we are targeting companies that already have budget for (corporate) activities. Part of our (aggressive) marketing efforts is to offer (them) discounts and promos. Even without these promos, our rates are already cheap,” he said.

The resort has 16 corporate bookings for April and expects more during summer. It also expects more weddings for June.

SRBC is also promoting its Marine Dive Center to attract more foreign tourists, especially Korean divers

Filed under: Business

Firms do more advertising outdoor amid global crisis

Sun.Star Cebu <> Saturday, March 28, 2009

BY NANCY R. CUDIS, Sun.Star Staff Reporter

AS consumers try to limit spending on essential items amid the global financial crisis, more companies are leaning toward outdoor advertising to promote their products and services.

“When times are hard, companies have to advertise more to push their products. OHM (out-of-home media) is a reasonable medium (for) that,” said Mary Anne Alcordo-Solomon, Outdoor Advertising Association of the Philippines (OAAP) Visa-yas Chapter president, in an interview.

OHM or outdoor advertising refers to advertising on billboards, tarpaulins, streamers and signages, among others.

With billboards, Alcordo said, a company spends only about P45,000 a month, depending on size and the location.

This is why, she said, companies continue to invest on OHM advertising. The crisis, however, has caused some companies to cut down on the number of billboards that carry advertisements of their products and services.

To adapt to the times, outdoor advertising companies offer special price packages to advertisers.

“While the (crisis) works to our advantage, we have to work double time on the creativity of design and play of medium, like tarpaulins with combination of neon lights. (We also) offer perks, such as exposure in our electronic billboard. It’s part of marketing. We have to listen to the needs of our clients,” Solomon said.

Solomon, also general manager of Alcordo Advertising, said her company maintains several billboards and is promoting indoor and outdoor signs.

Alcordo Advertising has invested in a Web-based electronic billboard, considered the first in Cebu. Launched last month in partnership with Greenworld Led Solutions Inc. for the technology and A5Com for the software, the billboard is located along Juan Luna Ave., Cebu City.

“We have adapted to the times. While (Filipinos) welcome new technology, the bottom line now would be cost,” Solomon said.

The electronic billboard offers potential clients about 70 spots a day or 2,100 spots in a month for both main-frame size ads and ad crawlers for a “reasonable” amount.

Alcordo Advertising, being the marketing arm of the billboard, reported an increasing number of companies that want to advertise. The firm plans to use the electronic billboard to feature various information, like electrical interruptions, weather reports, church schedules, flight schedules and educational trivia, among others.

Meanwhile, the company is also joining other companies, private organizations and local governments that will observe the Earth Hour 2009 today by shutting off its electronic billboard and the lights of its other billboards at 8:30 p.m.

Filed under: Business

Crisis hurts 68 MEZ firms: report

Sun.Star Cebu <> Friday, March 27, 2009

BY NANCY R. CUDIS, Sun.Star Staff Reporter

AS of this month, the ongoing global financial crisis has affected 61 percent of the locators at the Mactan Economic Zone (MEZ) 1.

The effects are manifested in the suspension of operations from four days to as long as six months as well as temporary work schedule adjustments, including forced leave, compressed workweeks, reduction of shifts per day, work rotation and the cancellation of overtime work.

Due to low demand, these actions were taken by majority of the locators that produce semi-furnished products for electronic and automotive companies.

MEZ 1 is home to 105 locators that employ more than 43,000 direct employees. The bulk of the locators are Japanese companies and are export-oriented.

A Philippine Economic Zone Authority (Peza) summary report on the effects of the global financial crisis on MEZ 1 as of March 15 said 68 companies have implemented work adjustments—20 of which decided to suspend operations temporarily while six have retrenched workers.

A total of 15,311 workers were already affected. Some 487 have been retrenched, 3,182 have stopped working due to their companies’ suspension of operations and 11,642 are under temporary work adjustments.

MEZ Administrator San-saluna Pinagayao said most of the displaced workers are sub-contract employees.

He added that Lear reported to have retrenched an estimated 250 regular workers who were paid benefits.

Through the Peza One Stop Workers’ Assistance Center, 896 displaced workers have already been assessed by the Technical Education and Skills Development Authority.

“Job placements have not yet been met since most of the present vacancies do not match the skills of the displaced workers, hence the need for skills training,” the report stated.

However, the same report indicated that there are 37 locators unaffected by the economic slowdown. Most of them belong to the garment industry.

Vacancies

Despite the crisis, some industries continue to hire workers and post job vacancies. There are 31 companies in the zone that recently hired 191 workers, both as direct hires and sub-contract employees. Currently, 18 locators posted 219 job vacancies, including 100 sewers, 50 production operators and 10 sample makers.

“There is a slowdown in orders (and shipments) but no company (at MEZ 1 and 2) has closed as a result of the crisis,” said Pinagayao.

In an interview with reporters, he disclosed that Western Wats Philippines in MEZ 2 continues its operations and recently expanded to Davao while Tsuneishi Heavy Industries Cebu Inc. reported an expansion plan that would translate to more employment opportunities in the shipbuilding sector.

He also cited Lear Automotive Philippines, Timex Philippines Inc. and Maitland-Smith Cebu Inc. as among the companies that continue to operate.

Tax holidays

To assist affected companies, Peza plans to extend their income tax holidays by suspending the running of the incentives when they have no operations and resuming the tax incentives when they recommence.

Pinagayao said that while MEZ 2 is already fully occupied, his office still receives inquiries on available land for eco-tourism and business process outsourcing investments.

At the same time, the Cebu Light Industrial Park Inc. (Clip)—a 62-hectare private industrial estate in Lapu-Lapu City registered under Peza—also receives inquiries about available lots for investments.

Clip senior manager for corporate affairs Delo Aton said they still have more than 30 hectares available for locators.

There are eight locators that employ a total of 1,400 employees. As of this month, only five workers have been retrenched, Aton said.

Filed under: Business, , ,

Demand keeps property owners ‘confident’

Sun.Star Cebu <> Friday, March 27, 2009

BY NANCY R. CUDIS, Sun.Star Staff Reporter

PROPERTY owners in Cebu are not lowering the rates of their projects despite the economic crunch, a real estate industry official said.

This is caused by a “balance” in the supply and demand of real estate in the market, Philippine Association Real Estate Board Inc. vice president for Visayas Tomasito Academia said.

“Cebu is better in terms of real estate compared to other areas in the country, like the National Capital Region where (most) property owners there are lowering their prices. People here know that the crisis is only temporary,” he said.

Even when the industry anticipates a “gradual” slowdown in the local real estate industry, stakeholders remain optimistic as real estate-related activities in Cebu are continually “moving.”

Migration

Academia attributed this to Cebu being a preferred point of migration by both locals—especially those from Region 9 (Western Mindanao)—and foreigners.

“Many are coming to Cebu because the commercial activities here are fast and are working. The peace and order (situation) is better here. And the tourism industry is very attractive,” Academia said.

The growing number of condominiums being constructed in the province manifests an “active market,” he added.

While Cebu still has a lot of room for property development, he asked developers to improve the quality and cost of their products “from good to even better.”

Products

While all types of real estate products—residential, commercial, agricultural and institutional—have a fair share of demand in the market, he lamented the backlog in the availability of low-cost housing products, which are in demand due to their affordability through the Home Development Mutual Fund (Pag-Ibig Fund).

He noted that not many developers are coming up with more low-cost housing projects due to their low profit margins.

Filed under: Business

Stimulus for seaweeds

Sun.Star Cebu <> Thursday, March 26, 2009

BY NANCY R. CUDIS, Sun.Star Staff Reporter

TO keep the seaweed industry going amid the global financial crisis, the Seaweed Industry Association of the Philippines (Siap) is proposing that the National Government allocate a P1.5-billion stimulus fund.

The fund can be used to boost the production capacity of Filipino seaweed farmers.

The industry supports some 300,000 families nationwide and contributes about $200 million to the Philippine economy annually.“Half of the amount (P1.5 billion) (can finance) farmers while the other half will be for processors and exporters (so they can) buy the seaweeds (at a reasonable price)…that they could take it as an inventory and make the seaweed inventory as the collateral under a quedan system,” explained Siap founding president Maximo Ricohermoso.

Ricohermoso, who conceptualized the stimulus proposal, stressed the need to sustain seaweed farming in the country through inventory funding as most buyers, exporters and processors have already exhausted their own capital since the beginning of this year in acquiring seaweeds.

The proposal was discussed during a recent Siap meeting and got the approval of members.

Production

He added that the Philippine Exporters Confederation Inc. has asked Siap to submit a copy of the proposal. At present, Siap is awaiting response from Agriculture Secretary Arthur Yap who was given a copy of the proposal last week.

If approved, the stimulus plan will be implemented within a year “to utilize seaweeds, stimulate production, create more jobs and grow the industry.”

“The (funding) is not a dole-out. (We have) a solid business proposal that will benefit all (stakeholders),” said Ricohermoso, also chairman and president of MCPI Corp. and Datingbayan Agro-Industrial Corp.

MCPI Corp., established in 1983, is a Filipino company engaged in the manufacture of quality natural grade carrageenan, specifically designed for food and nonfood industries.

In an interview with Sun.Star Cebu, Ricohermoso said Filipino farmers should continued growing seaweeds even if orders have declined in the global market to be ready when the demand goes up again.

“While we are in bad times now, we also have to prepare for the good times,” he said, adding that seaweed farmers also have to support their families.

He urged Filipinos to form a business partnership with relatives who work overseas and invest in seaweed farming.

Lull

Ricohermoso observed that the seaweed industry, being part of the export sector, would experience a “lull” from the first to the third quarter of this year.

He said major export markets—like the United States and Europe—of the country’s carrageenan (linear sulfated polysaccharide type obtained from red seaweeds) are cutting costs to cope with the global economic slowdown.

He cited the declining demand from the pet industry in the US as many owners now prefer to feed leftover food to their pets to cut cost . He said the sector used to buy substantial volumes of carrageenan for canned pet food.

Ricohermoso said, though, that the development of other applications of carrageenan—especially in pharmaceuticals and personal care products—help raise demand.

Local demand for seaweeds should also increase if people are made to realize the health benefits of eating the marine plant, he said.

“One has to learn a lot about his environment and the opportunity it offers, especially in difficult times. We have to think out of the box, be creative and persevere not only to benefit ourselves but also others,” Ricohermoso said.

He noted that the Philippines—where research is cost-effective and food technologists, chemists, and chemical engineers are highly competent—continues to be ahead of its competitors, like Indonesia, in terms of quality, technology and usage of carrageenan.

Filed under: Business, ,

BIR Cebu targets property sector

Sun.Star Cebu <> Thursday, March 26, 2009

BY NANCY R. CUDIS, Sun.Star Staff Reporter

THE Bureau of Internal Revenue (BIR) 13-Cebu City is eyeing the real estate and leasing industry in Central Visayas to help meet tax collection targets.

The sectors are among the major industries recently identified by the National Statistics Office through its 2006 Census of
Philippine Business and Industry as top grossers in terms of revenues in Central Visayas.

The BIR 13 will concentrate efforts on real estate and leasing, as well as on other industries like manufacturing, hotel andrestaurants, financial intermediation, construction, and wholesale and retail.

In a separate interview, Philippine Association Real Estate Board Inc. vice president for Visayas Tomasito Academia said that despite the global crisis, there is still an “active market” for the real estate products in the Visayas, especially in Cebu.

He noted that the market does not only include foreigners but also moneyed people from various parts of the country who are attracted by commercial activities in Cebu and are now looking for a place to stay.

Apart from tapping the potential of several industries, the BIR also plans to intensify its Oplan Kandado program and door-to-door tax mapping activity.

Under Oplan Kandado, business operations of non-compliant taxpayers will be suspended or temporarily closed. Grounds for closure or suspension include failure to issue receipts or invoices, failure to file a value-added tax (VAT) return, understating taxable sales or receipts by 30 percent or more of the correct amount in the case of a VAT registered taxpayer, and failure to register the business.

“With these strategies, we hope to exceed the target that will be set forth by the Department of Finance this year,” said BIR 13-Cebu City Director Rodita Galanto.

In 2008, BIR 13’s tax collection target was P9.9 billion but its actual collection was only P9.4 billion. About 34.9 percent of the collection came from income tax on individual taxpayers, 26.2 percent from income tax on corporate taxpayers and 20.9 percent from value-added tax.

Galanto said the bureau’s collection was also affected by the global financial crisis.

Collection of withholding tax of individual taxpayers is expected to drop with the implementation of Republic Act 9504, which was enacted to ease the effects of the crisis on Filipinos.

The law increases the take-home pay of minimum wage earners as it exempts them from paying income tax. It also raises personal tax exemptions for all income earners.

Still, the BIR continues to see advantages and opportunities to enhance its collection efforts in Central Visayas, such as a supportive business community and the government’s pump-priming infrastructure efforts in the region.

Last Tuesday, BIR 13 launched its annual tax campaign for 2009, signaling the filing season of annual income tax returns.
The bureau also awarded top supportive taxpayers, among them is the Cebu Filipino-Chinese Chamber of Commerce and Industry (CFCCCI).

“We should pay our taxes. It is our duty. The taxes we pay will come back to us through various social services through the government like peace and order, schools, health care, and other infrastructures,” said CFCCCI president Filomeno Lim.

The Mandaue Chamber of Commerce and Industry, another awardee, is planning to organize a tax management seminar with the help of the BIR and the Philippine Institute of Certified Public Accountants.

Filed under: Business, ,

LGUs need new data in planning

Sun.Star Cebu <> Wednesday, March 25, 2009

BY NANCY R. CUDIS, Sun.Star Staff Reporter

TO prompt local government units to respond accordingly to the global financial crisis, an economics professor asked government agencies to come up with more relevant data at the provincial, municipal and city level.

“If the (government) wants to mobilize local officials to act on the recession or to fight unemployment caused by the turmoil, there should be more data at the micro-level (to guide them in their decision-making),” said Fernando Fajardo of the University of San Carlos in an interview.

“If I were governor or mayor, I would ask where I am hit badly by the recession. Which industry? If I would like to help the unemployed or the displaced, who are they? Where are they? With no (statistical) basis, there is difficulty in deciding what to prioritize,” he added.

He lamented that there has been “very minimal” fresh survey data to illustrate trends in the Philippine economy or the effects of the crisis on the country even at the provincial level.

The Department of Labor and Employment, though, keeps track of labor issues affecting the formal sector in Cebu.

However, given the undeveloped nature of the country where the bulk of the businesses are informal, studies should focus on the informal sector with less than 20 employees, said Fajardo.

He observed that the informal sector will grow as more displaced workers would set up their own businesses to cope with the hard times.

Fajardo was one of the reactors during the regional data dissemination of the 2006 Census of Philippine Business and
Industry (CPBI) organized by the

National Statistics Office (NSO) last week. The survey covered establishments with at least 20 workers.

At the same time, the NSO launched the 2008 Annual Survey of Philippine Business and Industry (ASPBI) and the 2008 Survey on Information and Communication Technology.

The 2008 ASPBI is a nationwide effort to provide data on the structure and level of economic activity in the Philippines. Its results will be primarily used in planning and policy-making at the national level.

The 2006 CPBI results show a nationwide decline in the number of establishments and in employment, although there is growth in revenues or sales compared to 2005.

Jessamyn Anne Alca-zaren of NSO suspected a similar trend in the 2008 ASPBI since the reference year of the annual survey is 2008 when the crisis was already felt in the country.

Fajardo said there is a possibility that some companies with at least 20 employees have reduced their workforce, which is they were not included in the NSO survey.

“I suspect that the survey will report a decrease in the number of formal establishments. But it could be that there is growth in the informal sector,” he added.

Filed under: Business

WELCOME!

This is a personal site that contains my news articles on Cebu, local tourism, investments, real estate, small and medium enterprises, and many more! Some entries tackle personal thoughts and experiences as a business writer covering the Cebu business community. Enjoy your time here. And I hope to hear from you! -NANCY R. CUDIS

NRC: a Cebuano scribe


NANCY R. CUDIS writes for herself (a pastime), for her family (a source of income), and for the Cebu community (a sense of duty). For inquiries or invitations to cover events related to Cebu, you may contact her through her e-mail: nrcudis@gmail.com.

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