Tech platform for sari-sari stores lands on Forbes Asia's 100 to watch list | The Final Word - video Dailymotion

CNN Philippines

Many of us turn to our neighborhood sari-sari store for some of our basic needs.  One of the Filipino companies on Forbes Asia's 100 to watch list is a tech startup helping sari-sari stores go digital.  We learn more about Packworks with Co-Founder & CEO Bing Tan.   Visit our website for more #NewsYouCanTrust: https://www.cnnphilippines.com/  Follow our social media pages:  • Facebook: https://www.facebook.com/CNNPhilippines • Instagram: https://www.instagram.com/cnnphilippines/ • Twitter: https://twitter.com/cnnphilippines

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00:00 Many of us turn to our neighborhood Sari Sari store for some of our basic needs.

00:06 One of the Filipino companies on Forbes Asia's 100 to Watch list is a tech startup helping Sari Sari stores go digital.

00:15 We learn more about PAPWorx with co-founder and CEO Bing Tan. Hi Bing.

00:21 Hello.

00:22 Welcome to The Final Word and thank you for joining us.

00:24 No, no, no. Thank you for inviting me.

00:25 Our pleasure. First off, congratulations on being included on the Forbes list.

00:30 Thank you very much.

00:31 So, tell us how your platform works.

00:34 Okay. So, the way I would explain it is that PAPWorx is a business to business platform that connects consumer brands,

00:42 financial institutions, and Sari Sari stores into one location.

00:46 Okay.

00:47 So, the way I would usually explain it is that these are three people talking three different languages

00:53 and we're the bridge that connects all of them, right?

00:56 And so, typically, our Sari Sari stores need business technology and financial technology.

01:03 Okay.

01:04 And that's really what we're bridging here.

01:06 It's not a very straightforward platform, but the end goal is really to provide value to the stores that we work with.

01:13 Well, you serve over 270,000 Sari Sari stores, so that's impressive.

01:19 Thank you.

01:20 So, what companies do you connect Sari Sari stores with?

01:25 Well, typically, a Sari Sari store's problems are always product selection and capital to money, right?

01:33 And so, as far as the companies that we connect them to, they are the brand suppliers and their distributors that we connect them to, right?

01:42 So, we work with all of the fast-moving consumer goods companies in the country.

01:48 We introduce the stores that we work with to their distributors and we allow for them to access the cheapest access to pricing, right?

01:57 So, that's fantastic for our inflation right now.

02:00 Number two, it's always how do you provide business capital to the Sari Sari stores, right?

02:06 And typically, they've always been the unbanked or underserved.

02:10 So, in which case, by using the data that we gather, we provide these to the financial institutions so they actually get formal credit.

02:18 That formal credit provides them much cheaper access to capital.

02:22 So, that's really the intent.

02:24 It sounds complicated, but it's actually very simple.

02:28 Give them access to cheap goods and access to cheap capital.

02:31 That's what every business needs.

02:33 So, that's the Sari IQ, right?

02:35 Sari IQ is a function of all of the data that we gather.

02:39 Okay.

02:40 And so, I believe that we have a very unbiased set of information.

02:44 We actually see all of the goods that pass through the platform.

02:48 So, we understand which categories and which products actually sell well in the Sari Sari store market.

02:54 And how is that helpful for the Sari Sari stores as well as your other partners?

02:58 Okay.

02:59 So, as far as the Sari Sari stores is concerned, they actually get to understand better what products sell better, right?

03:06 And where their profit margins are coming from.

03:09 Now, from a data aspect, I think we have or we are the only company in the country that actually has information for all products in a Sari Sari store.

03:19 Typically, when other companies do it, they only have data to the products of goods that they sell.

03:26 Okay.

03:27 But because we don't sell goods, we're just the bridge.

03:30 We actually have a more holistic approach to data.

03:33 Okay.

03:34 Well, how did you guys get your start?

03:36 I heard a story about humble beginnings in delivering solar panels via motorcycle.

03:43 That is motorcycle.

03:45 That's correct.

03:46 That's a talent.

03:47 Maybe not a talent, but maybe it's a vice.

03:50 So, with my co-founders, I have two other co-founders, Iba Bernardo and Hubert Yap.

03:56 We've been motorcycle buddies for the past 15, 20 years.

04:00 And so, one of the things that my co-founder did, Iba, was we would ride across the entire country and we were delivering solar panels to the Sari Sari stores.

04:10 And that becomes part of your life.

04:13 I mean, we all grew up with a Sari Sari store.

04:15 We know what it feels like when you're there.

04:18 And when you get into these motorcycle trips, you get to talk to the owners and you figure out and you understand what their real problems are.

04:26 And it started from these conversations that happened probably about 10 years ago.

04:30 And we just kept at it.

04:32 So, fast forward to today, the three of us really just put our heads together and decided what is it exactly that we can provide these stores.

04:43 So, this was in 2018 that you started the company.

04:46 Yes.

04:47 And then the pandemic hit.

04:49 Yes.

04:50 What did that do for your business?

04:52 Did it create more opportunities or how did it impact?

04:57 Well, for a lot of technology companies, I think COVID was also God sent because there's really a digital transformation that's happening in the country.

05:07 What made it a little bit easier for the Philippines was that we have a very young population.

05:13 It's very easy or easier for a lot of our countrymen to just convert to being digital.

05:19 That's number one.

05:20 But number two, the stories are really heartwarming.

05:23 We had one minimum wage store clerk that lost her job during the pandemic, decided to focus on her small sarisari store at home.

05:36 We just so happened to have met her and we provided that technology for her.

05:41 During the pandemic, she was able to survive her whole family.

05:45 So, it opened up new opportunities.

05:47 For her, definitely.

05:48 Yes.

05:49 And she was able to double or triple her sales.

05:51 But now that inflation is so high, how is it affecting our sarisari store owners?

05:57 Well, looking at our data, the stores, we definitely see the impact of the inflation.

06:06 So, as far as the transactions are concerned, we're seeing the same price or amounts, but they're definitely consuming less.

06:13 Right?

06:14 And so that's why, I mean, if you are a sarisari store owner and you're an entrepreneur, the word there is "diskarte".

06:22 And for that to happen, you have to give them as much information as they can so they can decide what goods to restock in.

06:30 Right?

06:31 So, it becomes its own self-serving opportunity and process.

06:35 So, I guess that's one of the reasons why sarisari stores should go digital.

06:40 Correct.

06:41 Absolutely.

06:42 Oh, and there's one more thing.

06:43 There's one anecdote for our industry.

06:45 Did you know that about 50% of the smallest sarisari stores are what we call "AMPM stores"?

06:51 They have to restock goods because they don't have enough money.

06:54 Ah, I see.

06:55 So, they'll close the shop, buy goods in the morning, close in the afternoon, and restock.

07:00 Right?

07:01 And so, the way we do it is by providing and giving them cheaper access to goods, they actually get to save a trip during the day.

07:09 Which means that by giving them a little bit of business credit, let them purchase that entire thing, save more money, right?

07:16 And stay in the store more so you can sell more.

07:19 Right?

07:20 And so, that's how we've created that model and we're quite proud of it, honestly.

07:24 So, what's next?

07:25 Very quickly, what is next for Pacworks?

07:27 Well, we're definitely on track.

07:30 We're currently in about 270,000 stores right now.

07:33 We are on track to hit about 500,000 stores in the next 24 months.

07:38 And we are excited because there's a few companies there inviting us to other countries.

07:43 And so, being a tech company in the Philippines, I'd be very proud if we can really get out of the country and be exported.

07:50 I mean, that's a win for the Filipino.

07:52 Well, looking forward to great things from you guys.

07:54 Thank you for joining us, Pacworks co-founder and CEO, Bing Tan.

Tech platform for sari-sari stores lands on Forbes Asia's 100 to watch list | The Final Word

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