Doing Business in Cebu

Cebu contributes about 9% to the national GDP. The city’s economy has grown consistently at an annual rate of 7%. The region’s economy is diverse, with strong sectors in business process outsourcing (BPO), manufacturing, tourism, and retail. Cebu also serves as a hub for trade, transportation, and logistics in the Visayas region. Its proximity to major ports and its growing infrastructure make it an ideal location for businesses seeking to tap into both local and international markets.

Business Process Outsourcing (BPO): Cebu City hosts a dynamic and growing BPO sector, with numerous companies specializing in call center services, IT support, and back-office operations. The city’s strong English proficiency, educated workforce, and competitive labor costs make it one of the top outsourcing destinations in the Philippines.

Manufacturing & Export: Cebu has a solid manufacturing industry, especially in electronics, furniture, and garments. Its strategic location and well-developed port infrastructure position the city as a significant player in exports, particularly within the ASEAN market.

Tourism: As one of the Philippines’ top tourist destinations, Cebu City attracts millions of visitors annually. The city is a hub for cultural tourism, beach resorts, and eco-adventures, serving as the main gateway to the Visayas. Tourism remains a key contributor to local economic activity and job creation.

Retail & E-commerce: Cebu features a thriving retail scene with major shopping malls, dining establishments, and local markets. The rapid growth of e-commerce is reshaping consumer behavior, fueled by increasing internet penetration, mobile adoption, and digital payment systems.

To establish a business in Cebu, entrepreneurs must register with the Securities and Exchange Commission (SEC), obtain a Taxpayer Identification Number (TIN) from the Bureau of Internal Revenue (BIR), and secure a Business Permit from the Cebu City Government. Depending on the business type, additional licenses and permits may be required, such as those from the Department of Trade and Industry (DTI) or the Philippine Economic Zone Authority (PEZA) for special economic zones. Registration typically takes a few weeks, depending on the type and complexity of the business.Learn more about our Company Registration services.

In Cebu, businesses must comply with local laws including Labor Code regulations, tax obligations, and environmental laws. Companies are required to submit annual reports and tax returns to the BIR, and they must adhere to the Philippine Financial Reporting Standards (PFRS). Ensuring compliance with Social Security System (SSS), PhilHealth, and Pag-IBIG contributions for employees is mandatory. Companies must also keep up with environmental regulations set by the Department of Environment and Natural Resources (DENR), especially in relation to waste management and sustainability. Explore our Accounting and Tax services for comprehensive support.

Philippines’ taxation system includes several key taxes for businesses:

Cebu City benefits from strong government support, both at the local and national levels. The Cebu City Government provides incentives for businesses, especially in key sectors like manufacturing, tourism, and IT. Through agencies such as the Board of Investments (BOI) and Philippine Economic Zone Authority (PEZA), businesses can avail of tax holidays and other perks that promote long-term investment. Additionally, the city’s government continues to prioritize improving infrastructure and business processes to make Cebu an even more attractive place to do business. Our Business Visa services can assist you in leveraging these opportunities.

Intellectual Property: Patents and copyrights are registered with the Intellectual Property Office of the Philippines (IPOPHL) to protect intellectual property rights. Ask for our Trademark Registration services to ensure your assets are secure.

Labor Laws:  Philippines labor laws are comprehensive, covering Employment Contracts, working hours, minimum wages, and employee benefits. Compliance with the Labor Code is essential for businesses in Cebu. This includes ensuring proper compensation, employee benefits, and working conditions. Employers must follow health, safety, and social security requirements.

Environmental Regulations: Cebu City enforces strict environmental regulations, especially for waste management and pollution control. Companies must comply with these laws as regulated by the Department of Environment and Natural Resources (DENR) to support sustainable development in the area. We offer Business Contracts and Compliance Services to help you meet these standards.

Cebu’s strategic position in the Philippines makes it a vital hub for trade and commerce in the Visayas and Mindanao regions. Key infrastructure includes:

Cebu’s workforce is highly skilled, with many graduates coming from prestigious universities like the University of the Philippines Cebu and Cebu Normal University. The city’s rapid urbanization has led to increased demand for commercial and residential spaces, and this trend is expected to continue as businesses expand. Cebu City also benefits from a relatively lower cost of living compared to Metro Manila, making it attractive for both local and foreign workers.

Cebu City has a growing demand for both residential and commercial properties. The central business district (CBD) areas, such as IT Park and Mandaue City, are popular for office spaces and business operations. Rental rates in Cebu City are lower than in Metro Manila, making it an attractive option for businesses seeking affordable office space. Explore our Property Management services to secure your investment.

Cebu City is a prime location for property investment, with significant opportunities in residential, commercial, and mixed-use developments. Property prices in Cebu City have been steadily increasing, especially in high-demand areas near IT hubs and business parks. Foreigners are allowed to purchase condominium units, though land ownership is restricted to Filipino citizens or corporations with at least 60% Filipino ownership. Learn more about our Property Acquisition Services.

1. Sampaguita Gardens: Sampaguita Gardens, an eco-tourism business founded in 2014 in Cebu, is dedicated to preserving and promoting local culture while providing unique experiences for tourists. The company started as a small bed-and-breakfast and has since expanded into a full-fledged eco-tourism destination, offering visitors a chance to experience traditional Filipino culture through cultural tours, organic farming, and nature retreats. Sampaguita Gardens has quickly become one of the top attractions in Cebu, drawing more than 50,000 visitors annually. The company’s growth highlights the potential for businesses in the hospitality and tourism industry to thrive by emphasizing sustainability, local culture, and eco-friendly practices.

2. Gwapito: Gwapito, a beauty and wellness brand founded in 2016 in Cebu by entrepreneurs Bryan and Charisse B., was created with the aim to cater to men’s skincare needs in the Philippines, providing quality grooming products such as skincare, haircare, and shaving items. The brand quickly gained traction by leveraging the power of social media and influencer marketing. Gwapito now serves over 200,000 customers nationwide, with its products available in more than 100 retail stores and on major online platforms. The company’s success demonstrates the potential of the local beauty and wellness industry, and how innovative and targeted product offerings can scale quickly with effective marketing strategies.

3. Frankie’s New York Buffalo Wings: Frankie’s New York Buffalo Wings, a popular restaurant chain founded in 2008 in Cebu by entrepreneurs Franco and Michelle M., started as a small eatery serving American-style buffalo wings. The company gained significant popularity due to its unique menu offerings, including a wide variety of buffalo wing flavors and sides. Over time, Frankie’s grew from a single location to a nationwide franchise with more than 30 outlets across the Philippines. As of 2023, Frankie’s has expanded to 35 locations and continues to grow, becoming a household name in the country’s food and beverage industry. With its strong focus on quality, service, and consistency, Frankie’s success story serves as an inspiration for aspiring restaurateurs looking to build a recognizable and beloved brand.

Economic Forecast and Development Projects: Cebu’s economy is projected to continue growing, with an annual growth rate expected to reach around 5% over the next decade. Key infrastructure projects such as the Cebu-Cordova Link Expressway and the Metro Cebu Expressway are set to enhance connectivity and ease traffic congestion, stimulating economic activity. Additionally, the ongoing expansion of the Mactan-Cebu International Airport is expected to boost tourism and create new international business opportunities, positioning Cebu as a hub for both business and innovation.

Challenges and Opportunities: Despite rapid growth, Cebu faces challenges related to urbanization, traffic congestion, and environmental sustainability. However, these challenges create opportunities in sectors such as urban mobility, green technology, and infrastructure development. With Cebu’s push to diversify its economy, there are substantial opportunities in emerging industries like technology, real estate, and sustainable development. Contact us to start your business journey in Cebu today.