Declining Spending at Sari-Sari Stores Reflects Filipino Economic Struggles

In the bustling neighborhoods of Manila and the quiet rural barangays of the Philippines, the humble “sari-sari” store—a small, family-run variety shop—remains a lifeline for millions of Filipinos. These ubiquitous stores, often no larger than a living room, stock everything from canned goods to shampoo sachets, serving as a cornerstone of community life. But a recent study reveals a troubling trend: average monthly spending at these stores has fallen sharply, reflecting broader economic pressures on ordinary households.

A Shrinking Basket

A report released by local tech startup Packworks on May 19, 2025, paints a stark picture of changing consumer behavior. Drawing on data from its micro-retail analytics platform Sari IQ, the study found that the average Filipino spent just 689 Philippine Pesos (US$12) per month at sari-sari stores last year. This marks an 11.8 percent decline from the 781 Pesos (US$14) recorded in 2023, which itself was down from 800 Pesos (US$14) in 2022. The consistent drop suggests that many families are grappling with shrinking disposable incomes, even as inflation rates have reportedly eased in recent years.

Despite the reduced spending, Filipinos are visiting sari-sari stores more often. Packworks noted a 16 percent increase in monthly transactions, from an average of 15 in 2023 to 18 last year. However, each visit involves purchasing fewer items, a shift that points to the growing prevalence of the “tingi” economy—a practice where consumers buy goods in small, affordable portions to manage tight budgets.

“The combination of smaller basket sizes and more frequent visits to sari-sari stores highlights a preference for buying in smaller, more manageable quantities” said Andoy Montiel, chief data officer at Packworks. “This behavior likely stems from the need to stretch budgets further, even in a lower inflation environment. Consumers are opting to buy only what they immediately need, rather than stocking up with larger purchases.”

Regional Disparities in Spending

The decline in spending is not uniform across the archipelago. The Ilocos Region (Region I) saw the steepest drop at 31 percent, with monthly spending averaging just 570 Pesos (US$10). Metro Manila, the National Capital Region, followed with a 28 percent decline, averaging 702 Pesos (US$12) per month. Eastern Visayas (Region VIII) recorded a 25 percent decrease, with spending down to 508 Pesos (US$9) monthly.

In contrast, wealthier regions reported higher averages. Calabarzon (Region IV-A), encompassing provinces like Cavite and Laguna near Manila, averaged 1,027 Pesos (US$18) per month, while Mimaropa (Region IV-B), which includes Palawan, topped the list at 1,237 Pesos (US$22). These disparities reflect the uneven economic recovery across urban and rural areas, with industrial and tourist-heavy regions faring better than agricultural or remote zones.

The most commonly purchased items—seasoning mixes, detergent, powdered drinks, and hygiene products like shampoo—underscore the focus on essentials. These small-ticket items, often sold in single-use sachets, cater to the “tingi” mindset, allowing consumers to buy only what they can afford at a given moment.

The ‘Tingi’ Economy and Economic Pressures

The rise of the “tingi” economy is not merely a shopping habit; it is a survival strategy. For many Filipinos, especially those in low-income brackets, purchasing in bulk is a luxury they cannot afford. Instead, buying a single sachet of shampoo or a small packet of coffee for immediate use ensures that limited funds are not tied up in inventory that might go unused. This behavior, while practical, limits the ability of households to plan for the future or save for larger expenses.

Economic analysts suggest that this trend is tied to broader challenges in the Philippine economy. Despite government claims of declining inflation—reported at 3.8 percent in early 2025 by the Philippine Statistics Authority—many families still feel the pinch of rising costs for utilities, transportation, and education. Wage growth has lagged behind, particularly for informal workers who make up a significant portion of the labor force. The Asian Development Bank noted in its April 2025 report that income inequality remains a persistent issue in the Philippines, with rural areas and the working poor bearing the brunt of economic slowdowns.

Moreover, the reliance on sari-sari stores themselves speaks to structural issues in access to larger retail options. While supermarkets and convenience chains like 7-Eleven have expanded in urban centers, they remain out of reach for many in rural areas or informal settlements. Sari-sari stores, often run by neighbors and offering credit to trusted customers, fill this gap, but their small scale means they cannot offer the discounts or bulk deals of bigger retailers.

The Role of Sari-Sari Stores in Community Life

Beyond their economic function, sari-sari stores are a social hub in many Filipino communities. They are places where neighbors exchange gossip, share news, and build trust. Store owners often extend informal credit, known as “utang,” allowing customers to buy now and pay later—a lifeline for those living paycheck to paycheck. However, declining spending could strain these relationships, as store owners themselves face shrinking profit margins.

Packworks’ data does not delve into the impact on store owners, but anecdotal evidence suggests many are struggling. With fewer items sold per transaction, their inventory turnover slows, and the cost of restocking from wholesalers eats into already thin earnings. Some owners have resorted to diversifying their offerings, adding services like mobile phone top-ups or bill payments to stay afloat.

Government and Private Sector Responses

The Philippine government has acknowledged the challenges facing micro-retailers and low-income consumers. Programs like the Department of Trade and Industry’s (DTI) “Sari-Sari Store Advancement Program” aim to provide training and access to cheaper wholesale goods for store owners. However, critics argue that such initiatives often fail to reach the smallest, most informal operators who lack the paperwork or resources to participate.

On the private sector side, startups like Packworks are stepping in with technology-driven solutions. Their Sari IQ platform not only tracks consumer trends but also helps store owners manage inventory and predict demand, potentially reducing waste and improving profitability. Yet, digital adoption remains low among sari-sari store owners, many of whom lack the capital or training to invest in such tools.

Looking Ahead: A Reflection of Broader Struggles

The declining spending at sari-sari stores is a microcosm of the broader economic struggles facing millions of Filipinos. While the “tingi” economy allows families to survive day by day, it also highlights the fragility of their financial situation. Without significant improvements in wage growth, job creation, and social safety nets, this trend of smaller, more frequent purchases is likely to persist.

For now, the sari-sari store remains a symbol of resilience in Filipino communities, adapting to the needs of its customers even as those needs shrink. As policymakers and businesses grapple with how to support both consumers and micro-retailers, the question lingers: can the humble variety store continue to sustain neighborhoods in an economy that offers little room for growth?