Hitting a two-year low, a study found.
In the latest finding of tech startup Packworks, it reported that Filipino consumers monthly spending on sari-sari stores with an average basket size worth Php 689 in 2024, the lowest in two years.
This is despite the country’s year-to-date inflation easing at 3.2% in 2024, which was the lowest in four years.
The data was obtained through its mobile sari-sari store app and business intelligence tool Sari IQ, which looked at over 1 million monthly sales transactions from its network of over 300,000 sari-sari stores across the Philippines.
Packworks further noted that it observed the continued dwindling of the average basket sizes since 2022, which began at Php 800 that year, followed by a slight decrease at Php 781 in 2023, before hitting the lowest point.
CLOSER LOOK AT THE REGIONS
In the same study, the start-up said that stores in Region I (Ilocos Region) experienced the largest decrease at -31%, resulting in a Php 570.00 monthly average basket size.
That is also despite the fact that the said region recorded the lowest annual average inflation rate in 2024 at 2.1%.
The National Capital Region (NCR) also saw a -28% dip with a monthly average basket worth Php 702, and Region VIII (Eastern Visayas) with a -25% decrease and a Php 508 monthly average basket.
In contrast, customers in the Southern Luzon area, composed of Regions IV-A (CALABARZON) and IV-B (MIMAROPA), notably spent the most on sari-sari stores with monthly basket sizes at Php 1,027 and Php 1,237, respectively.
According to Packworks, these commendable figures can be attributed to the improved economies in these places, with CALABARZON accelerating by 5.6% and MIMAROPA by 4.4%.
CONSUMER HABITS
The company’s data also showed that while Filipinos on average spent less, they visited sari-sari stores more frequently.
Last year, Packworks’ network of stores recorded an average of 18 monthly transactions nationwide, a 16% increase from around 15 transactions in 2023.
Notably, Region I had the highest number of monthly transactions at 26, followed by Region IX (Zamboanga Peninsula) with 25, and Region V (Bicol Region) with 20.
Its business intelligence tool Sari IQ, meanwhile, also found that aside from declining sales of sin products (cigarettes and liquor), seasoning and recipe mix items, powdered drinks, detergent, and hygiene products (shampoo and conditioner) were the most common goods that make up the typical baskets of a regular sari-sari store.
Packworks Chief Data Officer Andoy Montiel says that data underscores a trending shift in the “tingi” type of buying behaviour, which sees more frequent, smaller purchases, as a way for Filipinos to manage their purchasing power.
“The combination of Filipinos’ smaller basket sizes and more frequent visits to sari-sari stores points to a preference for buying in smaller, more affordable portions – the essence of the ‘tingi’ economy.”
Montiel furthered, “This behavior likely stems from consumers needing to stretch their budget further, even in a lower inflation environment. They might be opting to buy only what they immediately need, rather than larger quantities less frequently to stock-up.”
SNAPSHOT OF THE ECONOMIC ACTIVITIES
Packworks CEO Bing Tan emphasizes the crucial role of sari-sari stores in providing a snapshot of the broader economic activities in the country.
“At Packworks, we see sari-sari stores as more than just cornerstones of our communities but vital barometers of the Philippine economy. Our latest data shows how Filipinos have adapted to economic realities from a macro to micro barangay level – a crucial finding that can help in crafting measures in helping economic eases trickle down to the grassroots level.”
Packworks was launched in 2018 as a solution for multinational companies with only a handful of sari-sari store partners.
Since then, it has rapidly expanded as a B2B platform that enables growth and success throughout all stakeholders in the supply chain ecosystem, from small sari-sari store owners to wholesalers, distributors, and renowned FMCG companies and brands.
Sari IQ, meanwhile, is their advanced analytics tool that processes data from its nationwide network pf sari-sari stores, with the aim of helping address the growing needs of both store owners and its suppliers to efficiently serve the community.