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Sari-saris are small neighborhood stores in the Philippines, often run by pen and paper notebooks. Inspired by motorcycle travel, PakWorks is on a mission to change that, with a mobile enterprise resource planning platform (ERP) led by logistics group Express Group and CVC Capital Partners, with participation from ADB Ventures, Aris, Techstars. and Ideaspace Foundation.
The startup will use the new funding to develop its super app called The Pack, adding to its platform offerings, including facilitating store operations, financing for businesses, and ordering overall supply chain management. It also plans to build a division that will engage sari-sari stores and provide additional services to parks, as well as an open platform for financial institutions and brands to connect directly with sari-sari owners.
Pakworks is on track to work with 150,000 sari-sari shops before scaling up, the company said. It was founded in 2018 with five sari-sari store partners as its first customer. Packworks is now on board with 150,000 stores and aims to have 220,000 stores by the end of 2022 and 500,000 by the end of 2023.
The Package Superstore app allows sari-sari owners to manage their business’s inventory, accounting and data collection processes. It provides access to financial products and supply ordering at affordable rates. The app is designed to use less bandwidth because store owners often pay higher interest rates and pay more for utilities. It also wants to lower interest charges and handle money with its e-payment features.
Owner of Sari-Sari using ERP Packworks
Packages started after founders Hubert Yap, Bing Tan and Iba Bernardo traveled to rural communities by motorcycle. During that time, they came up with the idea of working with sari-saris after traveling by motorcycle to bring solar panels to isolated communities. He said he saw how sari-saris especially in the provinces of the Philippines were finding it difficult to keep track of merchandise and find supplies for their stores.
Packworks Chief Marketing Officer Bernardo told TechCrunch that he and his two co-founders are avid motorcyclists and “doing our hobby, we start advocacy activities like bringing solar panels to marginalized communities.” During their journey, they stop at rural sari-sari stores to eat or rest. “We have noticed that these stores are having trouble tracking their inventory and finding items for their stores, especially in the states.” That’s when the three thought of creating a one-stop app. “We are committed to share our technical knowledge and inspire them to move from analog processes to the use of technology by observing first-hand the challenges posed by limited access to sari-sari owners, especially in remote locations,” he said.
The company originally started as a solution for multinational companies to connect with neighboring stores. In 2019, it was distributed in 220 stores nationwide and cost $400,000. A year later, these numbers increased to 27,828 stores at a cost of $30 million, and last year, it reached 130,000 stores at a cost of $139 million.
He added that they are not just one type of sari-sari stores and Packages has built a suite of apps for different types. For those who are more successful, he has created complete business tools. Created a beginner-friendly app for new sari-sari stores, guiding them and connecting them with mentor stores. “You can order from our platform,” he said. “Not only that, but they are small support groups that support each other.”
The Package: Super Store app provides sari-sari owners access to financial products and supplies at low prices. Bernardo said he aims to lower interest costs and access funds through electronic payments.
“It’s not just one or two sari-sari stores,” he said. “There is a rainbow from them. We are currently working with consumer packaged goods and fast food processors, but we are also working with carinderia type, or sidewalk restaurants, agritype and rice vendor type and more. It’s not about the size, it’s about the selection of goods. We now have over 150,000 users with an estimated 9,000 SKUs and are targeting to have 220,000 stores by the end of the year, and 550,000 stores by the end of 2023.
“This year is crucial for us,” said Bernardo Pacek, when asked about the revenue level.
“We are urgently looking for ways to improve our country’s supply chain,” said CVC Capital Philippines senior managing director and country leader and Fast Group board member Brice Koo in a prepared statement. The more than one million Sari-Sir stores in the Philippines are an integral part of this chain, and we believe there is a huge opportunity to build a digital layer to connect these stores with customers and suppliers. Layering the digital fabric of packages into this network and leveraging new data to create supply chain efficiencies holds exciting prospects, especially when combined with rapid experience and national scale.
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