Now is the best time to enter franchise business - Philippine Franchise Association

MANILA, Philippines – This is the best time to enter a franchise business because the financial crisis has forced consumers to look for trusted brands that will give them value for their money, the Philippine Franchise Association (PFA) said.

In an interview, PFA president Robert F. Trota said sales trend shows that people are still buying products. The only difference is consumers are more conscious and prefer products that are not very expensive.

In fact, he said all their members reported a growth for last year and are expecting the growth cycle to continue.

With regards to capital, Trota said banks are willing to lend money to entrepreneurs who would like to try their hand at franchising.

He said the Bank of the Philippine Islands (BPI) have already made a commitment to lend capital to potential businessmen.

Trota said most of the people who enter franchising are retirees or overseas Filipino workers (OFWs) and their families because they are the ones who have the time and money.

Despite the crisis, Trota said there are pockets of growth in franchising. “There is a lot of franchising opening today,” he revealed. He cited Mang Inasal and Generics Pharmacy as the franchisers that are expanding rapidly.

When asked what type of business is thriving now, Trota said growth is widespread. Currently, 40 percent of the PFA members are into food. The remaining 60 percent is equally divided between retail and service.

For his part, PFA chairman emeritus Sammie Lim said this is the time to expand to the international market because the local products are of superior quality and are generally more affordable than their international counterpart.

Local franchisers are looking at opening more stores in the United States specifically Guam and the Middle East.

Meanwhile, in order to cope with the financial crisis, Lim said businesses must realize that there is a shift in consumer behavior. He said people have become less brand conscious.

“People still have needs. They still have to buy food and clothes but instead of going for the more expensive brands they may choose the more affordable brand especially if the quality is the same,” Lim explained.

As such, Lim said the challenge is to offer a quality product at a more affordable price. “The demand is there. It is just a matter of marketing your product.”