Slide Do you need help
getting out of debts?
Find out your options! For free professional and
confidential initial consultation, call:
adam@debtcliniccanada.ca (905) 970-0439
Slide Do you need help
getting out of debts?
Find out your options! For free professional and
confidential initial consultation, call:
(905) 970-0439 adam@debtcliniccanada.ca
Slide Do you need help
getting out of debts?
Find out your options! For free professional and
confidential initial consultation, call:
(905) 970-0439 adam@debtcliniccanada.ca
Slide Do you need help
getting out of debts?
Find out your options! For free professional and
confidential initial consultation, call:
(905) 970-0439 adam@debtcliniccanada.ca

March 2021- IS IT WISE TO OPERATE A BUSINESS IN THE PHILIPPINES MANAGE BY RELATIVES OR FRIENDS

By:Adam Aspilla
March 5, 2021

The writer, had many clients, he helped to arrange refinancing on their existing mortgages or helped them arranged a loan for the purpose of operating a business in the Philippines to be managed by their relatives or close friends. Unfortunately, most of them did not succeed and became financially broke. 

The question is why? Hereunder are some of the reasons:

First – Lack of business acumen. Not everyone has a capital to invest in business is a businessman or businesswoman. To succeed in any field of endeavor needs special gift or talent on said specific field. Example: if a person wants to be a successful singer, that person must have a special gift of singing. If a person wants to be a successful boxer, that person must have a special gift in boxing.

Similarly, if someone wants to be a successful businessperson, he/she must have a special talent or ability (business acumen) to operate a business successfully. In fact, in the book of Dr. Napoleon Hill, “Think and Grow Rich”, of the 36 causes of business failure, lack of capital is at the last. 

Meaning, business capital is not a problem for if a person has a special talent or gift of running a business, initial business capital is easy to secure for banks and other financial institutions would be happy to grant a business capital loan by submitting a realistic business plan. Accordingly, not everyone can successfully operate a business despite having capital.

Second – No proper accounting. Though a person has a talent or gift to operate a business, he/she needs proper accounting records to guide him/her making wise business decisions to make a business profitable. 

Third – Lack of Internal Control Procedure. This is essential especially if a business is entrusted to some one (relative or close friend). Internal Control procedure includes: a surprise audit, especially for cash on hand, bank deposit and inventory of products/items sold. Without a surprise audit, could encourage or tempt a person you entrusted to misappropriate or use the money for purposes other than for the business operation. Actually, the Bible says, “…money is the root of all evils” (1Tim. 6:10), and 

Fourth – No Manual of Operation that includes policies like: purchase of inventory, mark up or the percentage you add to the cost of product or service you are selling to customers, authorize expenditures and specific duties and responsibilities of the person you authorize to manage the business. 

In addition to the above, even if you can avoid all the reasons of not succeeding your business in the Philippines while you are here in Canada, another challenge is the distance. It is almost impossible to implement properly your Business Manual of Operation to make your business a success.

With the foregoing, unless you can overcome the above reasons why most businesses do not succeed in the Philippines, managed by relatives or friends, the writer believes, it is not wise to operate a business in the Philippines manage by relatives or friends.

Adam Aspilla operates the Debt Clinic of Canada Inc. for more than 30 years.  He was a former financial planner, a former mortgage broker, and the author of the book, You Can Negotiate All Your Debts.  He also writes another column, “Biblical Perspectives” in this paper. For a free initial, expert, professional and confidential financial consultation on your financial issues like: Debt Consolidation, Credit Counseling, Consumer Proposal, Bankruptcy, and securing 1st and 2nd Mortgages, call 905-970-0439 or visit www.debtcliniccanada.ca

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