THE Philippine retail sector will continue to enjoy higher growth this year anchored on the continued rise of consumer spending, and the food sector will enjoy it even better, a key industry player said.
According to Philippine Retailers Association (PRA) President Paul A. Santos, the food sector is “the hottest” retail subsector in the country today, evident in the expansions of retail groups like Cebu’s Metro Retail Sales Group Inc. (MRSGI) and convenience stores.
“As income increases, you’ll see a lot of spending, (especially on) food, the hottest sector...Retailers are bullish on the prospects of going up in the remainder of the year,” said Atty. Santos at the sidelines of the PRA Cebu Outstanding Filipino Retailers Awards Night held last Thursday.
In the food category, PRA Cebu awarded Lantaw Native Restaurant of homegrown entrepreneur Bunny Pages, who also owns other popular dining concepts in Cebu like Mooon Café and Cafe Racer, as well as fruit shake carts Thirsty.
He was also an awardee of PRA’s Outstanding Filipino Retailers (OFR) together with the Cebu Home and Builders Center owners Michael Co and James Co for the non-food category.
The Cebu-based retailers who were also awarded include Twinbee Print Ads for the advertising retailer category, Habagat for fashion, Aerophone for gadgets, and Cebu Home and Builders Center for home improvement.
Based on the Bangko Sentral ng Pilipinas Consumer Expectation Survey (CES) released in early June, the first quarter rating marked the highest number reached by the index since the second quarter of 2013.
The recently released CES showed that the country’s consumer confidence index for the first three months of 2016 stood at -5.7 percent, up from -8.1 percent in the fourth quarter of 2015.
Although the index remains in the negative territory, the central bank said that consumers have become more positive, citing an improvement in availability of jobs, price stability and increased investment in the economy.
For the coming year, the consumer index expectations rose from 18 percent in the fourth quarter of 2015 to 25.4 percent in the first quarter of this year, its highest level since 2010.
In addition, the survey found that consumers expected growth in real incomes and a higher household purchasing
power over the coming year.
If there is any threat in the retail sector, Santos believes this would be the retrenchment of some overseas Filipino workers in the Middle East working in oil and other allied industries.
“Philippine retail is still dependent on the income received by the families of OFWs (overseas Filipino workers), and what’s looming on the horizon is the unstable price of oil,” Santos said. However, he also emphasized the growing influence of the Business Process Outsourcing industry on the retail sector, which he said might offset the effects of job losses in the Middle East.