Services sector adopts concept of franchising

As the Philippines slowly embrace franchising as an effective tool to foster growth in companies, other sectors like the services sector has started to adopt franchising.

From food and product based companies, now services firms, like wellness-spa, beauty salon, among others are entering strongly in the franchise concept, said Rudolf A. Kotik, the president of RK Franchise Consultancy.

In Cebu, there is several service companies in wellness and salon that have started to offer franchise packages, to pave the way for fast expansion not only within Cebu, but also in national and international scope.

He mentioned some Cebuano service companies such as Meddah Spa, Touch & Hill Spa, and Annie's Beauty Shop are now entering into franchising.

Also, there is a growing number of companies in the provinces, like Davao, Cagayan de Oro, Bacolod, and Iloilo that have recognized the benefits brought about by adopting franchise venture.

Franchising is the most successful business system in the world. It is simply a special type of licensing arrangement for the distribution of services and products.

Because of effective franchise system's adopted by some Philippine homegrown companies, including some Cebu based firms, there are at least 20 Philippine brands that are hitting or about to hit the international market, especially in Asia Pacific.

In fashion for instance, a number of Philippine-originated brands are penetrating in at least 14 countries such as United States, Saudi Arabia, China, and others.

These include; Bench, Cebu's Penshoppe and Island Souvenirs, Bayo, Kamiseta, Plains and Prints, among others.

In a separate interview with Philippine Franchising Association (PFA) chairman Samie Lim, he said that in services sector, there is also a big chance for smaller firms, like those offering cellular phone, computer, shoe repair services, to go bigger and see the huge potential outside the country.

Spa brand, Body and Sole for instance, which is now trying to penetrate in the Philippine market by providing wellness and spa services in good quality and affordable rates, is seen to successfully earn patronage from foreigners, through opening outlets in other countries.

He added that wellness and health related food and services business is now the new preference of the worldwide consumers, those who are embarking into these kinds of business concepts have greater chances to penetrate other countries.

Franchising in the Philippines accounts for 15 percent of the total retail sales, there are over 100,000 franchise businesses operating nationwide.

"We know more about franchising than any other countries in Asia Pacific, because 94 percent of Filipinos speak English, thus they can effectively sell their businesses through franchise in other countries," Lim stressed.