A study commissioned by Globe Business showed that about 50% of small and medium-scale enterprises (SMEs) run the risk of experiencing financial or operational difficulties and may close-shop within three years. The study cited limited capacity-building in running the various facets of a business as the main reason behind the difficulties encountered by entrepreneurs.
Manny Escosa, Head of Marketing for the Small and Medium Business (SMB) segments of Globe Telecom, said that about half of the country’s small and medium-scale businesses are likely to go bankrupt or close-shop by their third year of operation.
“From those remaining, only one out of 15 will go past year 5. And the reason for such is because SME owners tend to underestimate what it takes to become a successful entrepreneur, ultimately losing everything what they have invested into the business. Most entrepreneurs have the impression that starting is a business is a mere option to working a 9-to-5-job,” Escosa explained.
Approximately 99.6% of all Philippine enterprises are micro, small and medium-scale businesses, of which about half are engaged in retail and wholesale trade. They account for about 61% of the total employment level in the country.
“Around 560,000 entrepreneurs start their business from scratch without any background. However, they underestimate the need for controlling costs, institutionalizing good processes and increasing revenue,” added Escosa, “It all boils down to being able to manage costs, getting an effective process in place and increasing revenues.”
With this daunting scenario facing start-up businesses, Escosa said that Globe SMB proactively reaches out to SMEs to help them “survive” the challenging phase of growth by creating a product portfolio which could actually help businesses address the need to control costs, institutionalize good processes and increase revenue.”
One example of how SMEs can potentially increase revenues is through active promotion of their products and services to push their businesses via text messages. With close to 90 percent of the 94 million Filipinos having cellular phones however, less than 100 SMEs currently resort to text messaging to legitimately push their business.
To generate revenue streams by using the text messaging or SMS service of Globe SMB, they can rely on a mobile solution known as TxtConnect.
“With TxtConnect, you can send SMS to thousands of your customers simultaneously—as many as needed—in one blast. It is definitely an excellent solution for high-volume text campaigns. In Makati for example, the population swells in the daytime. At noon, people are wondering where to eat, and that is an easy market. Lunch places which have promotions do not have to text these people one by one. Imagine the time spent just to text them individually, or the cost saved instead of producing and distributing flyers. And it doesn’t have to look like a scam or a fraud.”
TxtConnect, according to Escosa, is the “ultimate mobile marketing tool for broadcasting SMS.” “It’s a user-friendly, web-based texting service that sends bulk SMS messages to a predetermined target subscriber or recipient base. And with lower rates per SMS, it is significantly more cost-efficient and far better than manually sending text messages or making regular phone calls, or physically distributing flyers, menus and promotional mechanism. It is actually ‘mobile advertising made easy.’ With TxtConnect, you have a facility to reach your target market with just a few keystrokes. And because the service is web-based, you can launch SMS marketing campaigns at any time and from any place. Another plus factor is its ease of use, allowing you to spend less man hours on mobile marketing and more on growing your business. Likewise, TxtConnect messaging rates are lower; you can target more consumers without raising costs.”