Doing Business in the Philippines

David-Elefant-PayrollHeroI asked David Elefant to contribute a guest post to our blog about doing business in the Philippines. David owns Dayanan Business Consultancy which assists individuals and foreign companies of all sizes in setting up their business operations in the Philippines.

Doing Business in the Philippines
Guest Post: David Elefant

Why setup a business in the Philippines?

The top reasons are the friendly English speaking low cost labor and the warm weather.

Your employees are your number one asset. In the Philippines you will find employees who are loyal, trainable, warm and caring, have good work ethics and are team players. Take good care of them and they will take good care of the company.

For larger operations there are tax incentives such as a four year exemption from corporate income tax extendable up to eight years, with the option to pay a special 5% tax on gross income in lieu of all national and local taxes after the tax holiday and exemptions from duties and taxes on imported capital equipment.

The Philippines is well situated in South East Asia with just a few hours flight time to 15 countries.

What to expect when setting up in the Philippines

dayanan_horizontal_black_transparentEntrepreneurs have various legal entities to choose from to setup their business. The choice will depend on the kind of business and where your clients are situated. Due to the many restrictions on foreign ownership, export enterprises are the easiest for a foreigner to establish. An export enterprise does not have any limitations on foreign ownership or require a high paid-up capital (Philippines’ regulations impose minimum paid-up capital depending on the nature of the business).

The Philippines bureaucracy has a love affair with paperwork.

Applying for any permit or business registration usually requires multiple copies of every document or permit you obtained at another government office and numerous visits. It can easily take up to two months to obtain all the necessary permits to legally operate a business. After receiving a certificate of incorporation or a license to transact business from the SEC, the next step is to obtain Barangay Clearance and Mayor’s Permit (many steps involved), then off to the Bureau of Internal Revenue followed by registering with the Social Security System, PhilHealth and Home Development Mutual Fund.

It is very important to understand the labor laws to correctly prepare employment contracts and employee handbooks. The courts will rule in favor of the employee on any clause which is not clearly stated.

Those who can do without every single modern amenity can find office space outside of the larger agglomerations and save on rent. Rent in Metro Manila is not cheaper than most North American mid-sized cities. The real savings is on the workforce if you know how to manage them.

Location, location, its important to find an office space that will allow your employees to reach work easily during bad weather especially during the typhoon season. Make you sure your office building has a generator. Other very necessary nearby amenities are restaurants and convenience stores.

Internet is not cheap and a backup connection is a necessity.

In the Philippines, the set up is slow but once everything is in place you will have found the right place to do business.

David Elefant, Consultant

If you have any questions about setting up in the Philippines, feel free to reach out to David.  Let him know PayrollHero sent you.  🙂

Employees Love PayrollHero!

PayrollHero has a unique position in the payroll space where we have a direct relationship with our clients’ employees.  Most employees have no idea who their company uses to generate payroll.  At PayrollHero, our clients’ employees have a direct relationship with PayrollHero, know our name, our logo and love interacting with the platform.  I saw a tweet this afternoon from RedBox Manager Andrea McClimans talking about how much she will miss clocking clocking in and out via PayrollHero’s photo booth as she moves onto her next challenge in her career. Maybe PayrollHero will follow her there?

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Do you want your employees to enjoy their clock in and out process?  We would be happy to give you a personal demo of the PayrollHero platform anytime.  Contact Us!

How to Pitch Your Story to Journalists in Southeast Asia

I asked Erwin Oliva to write a guest post about how to pitch your story to journalists in Southeast Asia.  Erwin was a pioneering member of the team that established operations of the (formerly known as and Yahoo! Philippines. Erwin is currently a contributing writer for Men’s Health Magazine Philippines, a senior lecturer at the University of the Philippines Diliman and Head of Product Development for Content & Services at Samsung Electronics Philippines Corp.

How to Pitch Your Story to Journalists in Southeast Asia
Guest Post: Erwin Oliva 

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One of the things that will help you “market” your startup idea is to get the media’s attention. There are a lot of ways of doing this, but we’ve put together this top 10 things that we feel are practical, and yet effective ways to pitch your story to journos.

1. Give them a unique story that is fit for their audience. Unfortunately, there is no one-size-fits-all kind of a media release. Once you figure out who their audience is, figure out a way to tell your story that would stand out. Online audience usually want video. They also want to experience the service. They also want to know the juicy details –especially for breaking stories. If you’re talking to business journalists–give them numbers, not just facts and let them make their conclusions. If they ask questions, give them enough information to run a story.

2. Be accessible but don’t be pushy. Provide basic contact information: Person of Contact, mobile number, email and of course, your website address. Throw in your Twitter and Facebook account too, just to make sure you got it all covered. But don’t keep calling them to follow up on a request. Most journalists will respect you for respecting their time–not that they want to be divas. Just make sure you reply to their queries even though it is just a “no comment.” 

3. Don’t lie about or manufacture facts you cannot backup. It’s their job to find out if you’re lying to their face. They will know. If they happen to stumble upon leaked information, and cannot make comment, be courteous to answer their call, and explain why you cannot comment. It’s mutual respect–they will also respect you for that. Just don’t lie to them and pretend things will go away.

4. Don’t ignore them too. A simple text message or email reply that, “Yes, we got your message,” would help ease the pain. For startup companies going through a lot of problems, it would be good for you to answer them with questions about how you’re dealing with it. It helps that you know what you’re problems are–but of course, be ready to offer a solution.

5. Show don’t tell. This is a lesson from Steve Jobs who was media-savvy. He made sure when he does product demos, everything’s working well, not just fine. You should be able to eat your own dog food, which means you’re a power user of your own service/product. Journalists could tell if you’re fumbling or if you’re pretending to know what you’re doing.

6. FAQs are very useful. When drafting a media release, anticipate the questions that journos will be asking. So you have to develop a “sixth-sense” to predict what kind of questions they want answered, and how they want it answered. FAQs are very useful not only on websites, but also in releases. You can put in commonly asked questions by users, a bit of history, background of the founders, and your one-sentence business proposition (What is your business all about).

7. Develop good relations with them, always. Don’t disappear after a media conference. Hang out with the journos. Talk to them, but make sure what you say is not going into tomorrow’s news. Just get to know them better and find out what makes them tick. At the end, it is going to be about relationships. Journalists all aim to develop good sources of stories. So if you can, share some industry insights, refer them to other companies you think they can write stories about, or if you’re okay with it–give them some insider information–but not giving away any confidential information or even putting someone or a company in trouble. But they will try to push.

8. Use social media to engage them.  Many journalists today–especially the media savvy ones, are starting to ask questions via Facebook or Twitter. Why? You’re busy and if company policy allows, you can use social media as your “real time” blog or channel to update journalists about the status of a project. Use Instagram or other social networking sites (YouTube) to spread word about the company, activities you wish they covered (community projects), and other stuff that gives them enough information to create a story. Be your own media and PR agency.

9. Learn to talk to journalists. Learn their language. Understand them. Don’t talk down on them. Pretend you’re explaining to non-techies (actually assume that you’re talking to people who don’t have any idea about what you’re doing). So avoid acronyms, skip the geek talk. Go straight to the point. Don’t use corporate talk–or rhetoric to explain simple processes or issues. But don’t overdo this to the point that it can be demeaning. Balance is key.

10. Respect deadlines. Don’t waste their time. Know their deadlines. Know that when they’re calling, it may be urgent. If you promise to reply to a certain email, figure out the timelines. Turnovers are often quick especially for online news mediums. Magazines, TV or radio may have different needs–but they all have deadlines. So be ready with all the information that you think they will need. But don’t go beyond what you want to say. Over sharing may do more harm than help.

So there you go. These are practical advice culled over years of covering technology companies. And we at StartUpMachine feel that it’s about time to share our “trade secrets.” –Erwin

Use PayrollHero To Help With Staffing Needs During Storms

Screen shot 2013-08-19 at 9.10.55 PMThe weather in Southeast Asia plays havoc with businesses, but specifically with restaurants and retail businesses every rainy season.  It is common that businesses don’t open, close down early or operate with less staff than required.  Today is no exception in the Philippines.

A weather storm has been on its way towards the Philippines for the last couple of days and as government, businesses and citizens prepare to deal with the consequences of the storm (read: massive flooding) I wanted to take a moment and share how PayrollHero is working to use data to help businesses cope with challenging weather systems.

As an example, take these three restaurants that are side by side in Fort Bonifacio;, TokyoTokyo and Wildflour.  The first 2 are closed and Wildflour is open but closing early.

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Screen shot 2013-08-19 at 9.17.57 PMNow there are many reasons why businesses close during storms.  Staff can’t make it to work, staff need to deal with issues at home, road flooding, Government advisory, etc. While it is good to keep that in mind, what I’m referring to here is using data within a restaurant or retail business to better understand your staffing needs.

Wildflour is quite busy today (which is normal for them) but if you look at the options for people who want food in their specific area, they are the only choice because they were the only one open today.  They are closing early, which the manager said was because they wanted to give the staff enough time to get home as many come from far distances.

What is the cost of being closed on a day like this? two days? three?

If you could find a way to be open, what is the profit? especially if your competition is closed?

So what does this have to do with PayrollHero?

When we first built PayrollHero we saw the trend of how weather effects employees time and attendance as well as how employee commute distance effects their time and attendance.  We decided that we could use data and see if we could track the correlation between those items and employee attendance.

Within every PayrollHero account there is an “Analytics” tab (beta) that shows management as well as employees how their time and attendance stacks up against their colleagues.  But one part of the analytics is built specifically for situations like this.

PayrollHero pulls in the weather for your office location and showcases it against employee time and attendance.  The idea is to give you an accurate idea of how weather effects your business.  Here are a couple examples:

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As we continue to expand on the data, the idea is that PayrollHero can help you anticipate how the upcoming weather will effect your workforce as well as enable employees to make travel decisions based on the weather.

Imagine if you could call extra workers in to replace workers who have not even called in to say they can’t make it to work.  

Commute Distance
The other data set we work with is the employees commute distance.  PayrollHero knows where the employee lives, as we need that data for payroll, but we use that data to correlate how far away an employee lives from their place of work and how that distance effects their time and attendance.

Employers and employees can see the data and the idea is to help them both make better decisions on where to live, where to work, etc.
Screen shot 2013-08-19 at 9.06.51 PMThere are many companies in Southeast Asia that pay a proximity bonus to employees who live closer to work as the employer knows that the closer they live, the less likely they are to miss work due to traffic, weather, etc.  In PayrollHero, we show this data to help everyone make better decisions on where to work and where to live.

Imagine you knew a storm was coming in and you could contact workers who live close to work to take the shifts so that you can stay open, keep your employee safe (ie. they don’t have to try and commute via flooded streets) and profit when others are closed! 

Interested to learn more?  Contact us as we would be pleased to setup a personal demo of PayrollHero. (signup here for a free, no obligation personal demo)


Why Start A Business In The Philippines?

As you may have noticed we have been filming quite a few videos for PayrollHero.  Videos showcasing how the platform works, testimonials as well as a couple recruiting videos.

While shooting these videos, we decided to interview a few business owners and investors on why they have chosen the Philippines for their businesses. We stitched them together for your viewing pleasure.  You can see the video below.

In the video is:
Christian Besler – Kickstart, Philippine Investment Fund and Incubator
Bryce Maddock –, 500 Employee Outsourcing Operation
Ralph Wunsch – MetroDeal, Philippines Largest E-Commerce Website
Nick Franklin – Zendesk, Asia’s Head of Business Development
Ron Hose – Investor, Entrepeneur
Earl Valencia – Ideaspace, Philippine Investment Fund and Incubator


Signup here for a FREE 14 day course on how to start a business in the Philippines!

How is the BIR Tax Deduction Computed?

“The Bureau of Internal Revenue is an attached agency of Department of Finance. BIR collects more than one-half of the total revenues of the government.” *wikipedia

PayrollHero makes it quick and easy to compute the numbers for the BIR tax deduction for your employees in the Philippines.  You can see how this works in more detail here.