Crisis pushes drop in demand for mobile phones

By JADE LOPEZ, Reporter

THE country’s mobile phone retail industry is now facing the brunt of the global financial crisis as a homegrown cellphone retail company reported a 35-percent decline in sales volume from January to March this year.

“For the last 10 years, this period (first quarter of this year) is our lowest in terms of sales,” said Pablo “Jun” Yap, who owns “Junrex Cellphones and Accessories, Inc.”

Yap pinned the decline to the present global economic meltdown, whose domino-effect caused a slump in consumer spending, especially among Filipinos.

He said that while the company is still able to generate sales, most of the items sold, however, are low-end to entry-level phones.

“We’re looking at the situation positively. If a colored phone cost P6,000 to P10,000 before, it would cost less than P2,000 now. Technology has become cheap. It adapts to the times,” he told reporters earlier in the sidelines of the general membership meeting of the Philippine Retailers Association-Cebu.

The mobile phone retail chain has felt the effects of the global crisis nearing the end of 2008, ahead of other sectors in the country.

Yap said Junrex’s sales began to drop as consumers, who are aware of the recession in the United States, started to hold on to their money.

Although sales volume started picking up during Christmas and the Sinulog celebration last January, Yap lamented the figures were still low compared to the same period in 2007 and 2008.

“Even the first two weeks of this month, our sales were also low but we managed to pick up during the last two weeks since many families buy cell phones as graduation gifts,” he added.

Apart from hurting over the drop in sales volume, Yap also announced the company’s recent closure of two Junrex shops—one in Tagbilaran, the other in Mactan—as well as one of the company’s two offices at Ayala Life-FGU Center in Cebu Business Park.

He too projected it might lose 20 percent of its manpower. “One good thing is that we will be able to run our business more efficiently. We will be able to find out if we have excess or lack of staff in a shop,” he assured.

Even Junrex’s expansion plan to open a branch in every city in Cebu-like Carcar, Talisay and Naga-within the next five years is put on hold.


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