The tough economic times may be dealing hard blows on big business, but they are giving an auspicious start to many home-based businesses in the country.
The reasons are obvious. Doing business while staying at home requires much smaller startup costs; you don't have to pay a small fortune for a fancy office and the staffing and utilities to maintain it. And, of course, family members and others living in the household can be expected to help or pitch in for you anytime and on short notice--often without need to pay them hefty overtime or holiday compensation.
No wonder then that many startup entrepreneurs are finding home-based businesses a great way to supplement their income from their day jobs, and that not a few career-shifters are finding both psychic and financial fulfillment from running home-based enterprises.
Even more gratifying, a great many home-based businesses become the seed bed or takeoff point for bigger, more ambitious mainstream businesses, some of which blossom into multimillion-peso ventures even if they continue to be run at home.
Entrepreneur has put together the inspiring and highly instructive stories of 12 successful home-based businesses--ventures that are as diverse as their owners and their interests.
CORNERSTONE CERAMICS
By Roderick Abad Photos by Jun Pinzon
In April 1996, husband-and-wife EJ and Eva Espiritu left the United States and came back to the Philippines, hoping to find work here as a ceramic engineer and marketing professional, respectively. Little did they know, however, that they would just end up adding to the country's increasing unemployment rate--what with the 1997 Asian financial crisis hitting economies in the region, including the Philippines, really hard.
"We realized we didn't have that much money to support ourselves in the long run, so we immediately took the business opportunity offered to us by a friend of my husband," recalls Eva. "It was to do subcontracting work for an exporter selling house ware and decor to Europe and elsewhere overseas. That was how we got started on a home-based pottery business--purely out of necessity."
In August of 1996, after the exporter lent them P125,000 in initial capital, the Espiritu couple started their small-scale enterprise in a rented house in Bacoor, Cavite. Calling it Cornerstone Ceramics, they registered it as a sole proprietorship. Then they bought a kiln and other baking equipment, contracted 12 workers, and made their garage double up as a makeshift production area for the ceramic components and earthenware needed by the exporter.
The production demand almost doubled in less than a year, so the Espiritus transferred their operations to a bigger place in Imus, Cavite, which became both their home-office and factory. But the growth of their ceramics business was short-lived. By 1998, due to the Asian economic crisis, orders started to decrease precipitously until the exporter couldn't place any more orders by 2000.
"That convinced us that we might die a silent death unless we did something," Eva recalls. "So we decided to develop our own product line and look for new buyers. Stoneware, which is a high-end form of ceramics, was then relatively unknown in the Philippines and wasn't available commercially yet. We saw its strong market potential so we decided to go into it."
EJ AND EVA ESPIRITU: They had intended to teach pottery-making simply as a source of supplemental income, but to their surprise, their workshops had been drawing a huge participation.
Putting his technical know-how in pottery to good use, EJ started developing his own clay-and-glaze formulation. For her part, Eva used the marketing skills she had learned from her US studies, creating a website for their company, www.cornerstonepotteryfarm.com, and making advertising collaterals. Closely working together, they eventually came up with a sizeable line of mugs, teacups, tea sets, chimes, dining ware--even oil burners for aromatherapy and bathroom amenities.
These products, although priced quite expensively between P35 to P12,000 depending on size, nevertheless received an enthusiastic reception when they were launched in March 2000 during the National Trade Fair at SM Megamall in Mandaluyong City.
Since then, Cornerstone Ceramics has become a regular at trade fairs and bazaars, generating more customers and making trade deals with leading Metro Manila department stores and other retailers.
The business continued to pick up briskly. By 2002, in fact, the Espiritus were able to settle the balance of the loan extended to them by their former exporter.
Three years later, to further expand the business, they acquired a 5,000 sq m property in Silang, Cavite. They added two more LPG-operated ovens to their existing kiln, then further improved the quality of their stoneware by using more matured clays imported by their supplier from Thailand, Vietnam, and China.
The Silang site has since become the couple's residence, pottery shop, and workshop area--the "Mud Pit," they call it--aside from being their stoneware factory. In February of 2008, the couple also put up a cafe in their Silang compound primarily to serve healthful snacks to their customers.
By 2003, most of the couple's contemporaries in the stoneware business had begun to experience sales declines. Bucking the trend, however, the ever innovative Espiritus gambled by introducing what they called the "service side" of their business--the "Mud Pie Party," a pottery-making workshop for hobbyists and for serious learners. The two-hour workshops are conducted by the couple by appointment in the Mud Pit, their 10-seater workshop area next to the factory. The fee is P550 per participant, and P850 inclusive of lunch.
The Espiritus had intended to teach pottery-making simply as a source of supplemental income, but to their surprise, their workshops have been drawing much more participation than they expected. They have therefore decided to run the workshops offsite, offering them today at P750 per head for a group of at least 10 people.
LOOKING FORWARD
Cornerstone Ceramics considers itself a "thriving, surviving" small-scale home-based enterprise that caters to the B, upper B and A markets. Its stoneware products continue to enjoy a good following from both repeat and new customers. On the average, the business is able to produce and sell P200,000 worth of stoneware in two weeks--just enough, EJ and Eva Espiritu say, "for us to continue to operate, save, meet our personal expenses, and do tithing.:
Eva says of their business prospects: "We're just hoping that this year and in the years after that, our cafe in the Silang compound will do well, and that we can hire more people to work in the factory. Also, I look forward to seeing more clients coming to attend our ceramic-making workshops."
PUNCHDRUNK PANDA LAPTOP SLEEVES
By Jan Vincent Ong. Photos by Jervy Santiago
Jennifer Horn and Nathania Gail Go have known each other since grade school. They went on to the same high school and became best friends as badminton partners. In college, Horn took up psychology at De La Salle Taft and Go studied management at Ateneo de Manila University, but they still kept in touch.
After their graduation in May 2006, they decided to pursue a sideline business together. Go says they did this so that as partners, they could mutually judge each other's work and improve on each other's ideas. They initially wanted to put up a T-shirt business, but they still didn't have the graphic design skills to do it. They therefore opted to go into the bag business instead, availing of the services of a friend who could produce the bags for them.
Seeing that the price of the typical laptop bag started at P1,000, they saw a business opportunity in specializing in laptop sleeves. They felt that by designing funky patterns for their sleeves, they could dramatically improve the bland designs of laptop bags. They were sure that there would be a substantial market for their laptop sleeves because what were locally available then were only for Apple laptops.
They thought that the name of their product should be "cutesy enough" to draw both guys and girls, so they branded it Punchdrunk Panda. They then invested P100,000 to produce laptop bags in 14 different designs and launched their business online on Multiply in July 2007.
Horn says they chose Multiply because they saw its potential based on the presence of local online stores in the website. Another reason was that at the time, Go had just started as an intern in the advertising agency Leo Burnett and could not possible engage in a full-time business on her own. In any case, the partners found it easier to manage their bag business through simply checking e-mail orders after work.
But their first months in the business were characterized by trial and error. For one, they realized that they had ordered too many designs for their initial run, and that their product delivery system was just not good enough. They used to ask customers to meet them in either the La Salle or Ateneo campus to accept delivery of their bags, until they discovered that using LBC or Air 21 for the purpose was cheaper and more efficient. As they did the business, they also gradually discovered their respective strengths--Horn was better at talking to customers and Go worked better dealing with suppliers.
Horn says that keeping customers happy was their goal, so they actively sough customer comments by running a feedback form in the Punchdrunk Panda website. From the feedback they got, for instance, they were able to fine-tune the sizes of their laptop bags as well as make their order system more efficient. They have since made arrangements to accept payments for their products through GCash, Western Union, and BPI.
The partners consider Punchdrunk Panda as an online brand, but to reach new customers, they now also usually frequent bazaars such as the "Global Pinoy Bazaar" by Yabang Pinoy.
Horn, who now works as a copywriter with the advertising agency J. Romero & Associates, says that she and Go find their sideline business fulfilling because it allows them to use their creativity on their own. In her case, she says, it gives her a stronger sense of accomplishment to work with a friend on something that's truly theirs.
Currently, the partners are set on building the Punchdrunk Panda brand to become the next Hello Kitty in terms of market positioning. They are now developing new sleeves with a white background where the customers can customize their own designs. They are also looking into making dolls and cellular phone charms featuring their Punchdrunk Panda mascot, and issuing gift cheques and freebies such as gift sacks to help build a bigger base of loyal Punchdrunk Panda fans.
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