SERVE THE POOR - AND PROSPER

JOSE GO, 48, WORKS 12-hour days overseeing the day-to-day operations of his Ever Gotesco retailing and real-estate empire. Reputedly a billionaire, the Filipino entrepreneur made his fortune by targeting the low-income group. Senior Correspondent Antonio Lopez recently spoke with Go in Manila. Excerpts:

Why do you focus on the masses?

The majority of our people are poor. But what they lack in income, they make up for in numbers. Now their salaries are growing and so is their purchasing power. The Filipino wage earner is a family man. If he draws his salary on a Saturday, on Sunday he is at the mall spending that money with the family.

The prospects for retailing are very good. Our gross national product is getting bigger; per capita income is growing fast. The expansion of the retail market is accelerating and may reach a rate of 37% per annum. Personal consumption expenditures will grow 5% this year, compared with the historical average of 3.7%.

So what happens to Ever when most Filipinos have become prosperous?

Everybody is now price conscious. Even the affluent no longer care so much for brands. Besides, the consumer market is huge and it will take time before everyone graduates to the higher income bracket. Anyway, we will follow market trends. If consumers want brand names, we will give them brand names.

At 0.5% last year, your net income as a percentage of sales was the thinnest among the big retailers.

Our margins have been reduced considerably because of renovations in our stores, which involved improvements such as adding airconditioning capacity and better interiors. With the increased comfort, we expect bigger crowds and thus higher volumes. This year, our profit margin will be 7.5% of sales. Despite that, we will maintain quality control. We go directly to our suppliers and we import goods ourselves. With the reduction in tariff duties, we have increased our importations. This year, about 30% of our products will be imported, up from 20% last year and 5% to 10% five years ago.

Do you favor allowing foreigners into retailing?

Yes. Competition will be good for customers. They will get quality goods at better prices. As a retailer, we have the distinct advantages of knowing our customers and our market, having the right price and being at the right location. And high volume turnover will keep our profits healthy. When foreigners come in, they will move into major locations - where we are now. We can tie up with them. They can give us access to a worldwide purchasing system and technical know-how. We can provide manpower, good relations with suppliers and knowledge of the market.

Where do you see your group going?

We will put up one shopping center every year over the next five years. We will be in resort hotels as well as low-cost housing. We are also going into what we call backward integration - developing our strategic, engineering and design expertise to support our projects. We will become one of the country's leading real estate companies. And I will be very happy if we become No. 10 among the top business conglomerates in this country.