1 out of 4 nanoenterprises adopted online selling in response to lockdowns

At least one out of four nanoenerprises are now either selling their products online, or are buying products to be sold in their local communities to cope with granular lockdowns imposed by local government units. Out of 7,675 respondents, 26% sold products and 29% bought supplies online, to augment their livelihood operations.

Nanoenterprise is a SEDPI-coined term that refers to unregistered livelihoods of self-employed individuals that have capitalization of less than PhP50,000 to operate. SEDPI estimates that the vast majority of entrepreneurial poor in the Philippines are nanoenterprises, numbering around 8 million.

Nano level risk diversification

More than half of the respondents or 52% also claimed that they added other kinds of livelihoods in response to the pandemic. Nanoenterprises refer to this as “diskarte” to be able to survive the negative economic impact of the pandemic. Diskarte is the ability to use creativity and resourcefulness to respond to challenges and adversities.

Nanoenterprises involved in the agricultural sector were better able to weather the pandemic compared to their non-agri counterparts. Eighty nine percent of the respondents said that those with farms were able to adjust and fair better.

Farming households were able to harvest produce for consumption. The surplus farm produce were then sold in local markets through ambulant vending and online selling. This resulted in reduced expenses for food and at the same time provided ample additional income

Status of nanoenterprises

A year after the Enhanced Community Quarantine (ECQ) imposed in the whole country, all

nanoenterprises reported that they already resumed operations. At the peak of the ECQ last year, 69% of them stopped operations which prompted the government to distribute cash assistance.

As of March 2021, four out of ten respondents said that they have fully recovered from the negative economic impact of the pandemic; while 55% said that it will take them up to 2 months more, before they get back to their pre-pandemic levels.

During the first quarter of the year most areas in the country were under Modified General Community Quarantine (MGCQ), the lowest quarantine level imposed by the Philippine government. These reinvigorated the local economy due to ease in the flow of goods and mobility of customers.

Social Enterprise Development Partnerships, Inc. (SEDPI)

SEDPI provides capital to nanoenterprises through joint ventures to approximately 10,000 low-income households in Agusan del Sur, Davao de Oro and Surigao del Sur. Its members also benefit from life insurance as well as medical and disaster relief assistance through damayan. SEDPI also partnered with SSS and Pag-IBIG to bring social safety net programs of the government closer to nanoenterprises in rural areas.

This research is part of a series of rapid community assessments that determines the economic impact of COVID-19 to nanoenterprises. SEDPI began the research last March 2020. This latest update was conducted on April 2021 to cover the first quarter of 2021.

The 7,695 respondents is not a representative sample of the entire Philippines. It is highly localized to SEDPI members. However, this is a good case study that reflects the situation of nanoenterprise and the local economy in the countryside. SEDPI believes that the nationwide picture is not far from its research results.

Summary of findings:

• Out of 7,675 SEDPI nanoenterprise respondents 26% sold products and 29% bought supplies online to augment their livelihood operations
• 100% are resumed livelihood operations a year after the hard lockdown
• 52% added other kinds of livelihoods in response to the pandemic
• 89% said that those with farms were able to adjust and fair better
• 40% fully recovered from the negative impact of the pandemic
• 55% said it will take them up to 2 months more before they get back to their pre-pandemic levels

Previous rapid community assessment updates. The titles are hyperlinked. Click on the titles to full read article online.

• January 20, 2021 (Update 11): Typhoon hampers bounce back of nanoenterprises in CARAGA
• July 17, 2020 (Update 10): Almost 4 in 10 nanoenterprises bounce back to pre-pandemic level
• June 12, 2020 (Update 9): Microenterprises show signs of bouncing back as lockdown eases
• May 28, 2020 (Update 8): 8 out of 10 microenterprises open for business one month after GCQ
• May 22, 2020 (Update 7): Demand for microenterprise products remain weak amid COVID pandemic
• May 15, 2020 (Update 6): Demand slumps on microenterprise products 2 weeks after GCQ
  May 8, 2020 (Update 5): Only 5% of microenterprises back to “normal” in first week of GCQ
• April 30, 2020 (Update 4): Two in three microenterprises hopeful to bounce back two months after lockdow – UPDATE 4
• April 24, 2020 (Update 3): Community assessment and recommendations for support to microenterprises and the informal sector during and after COVID-19 – UPDATE 3
• April 14, 2020 (Update 2): Community assessment and recommendations for support to microenterprises and the informal sector during and after COVID-19 – UPDATE 2
• April 6, 2020 (Update 1): Community assessment and recommendations for support to microenterprises and the informal sector during and after COVID-19 – UPDATE 1
• March 30, 2020: Immediate impact of COVID-19 lockdown to microenterprises