CEBU, Philippines - While some industries suffered from the effects of the global economic recession, the franchising industry in the Philippines continues to grow by double-digit in the few years, or an average of 20 percent year on year.
Filipino International Franchise Association (FIFA) president Rudolf Kotik as he announced the formal opening of the upcoming 11th Cebu Franchise Expo at SM Cebu on March 11 to 13 (2011).
“I might say that this is the only business segment which had grown continuously without interruption for a period of over 15 years,” said Kotik, who also owns a Franchise Consultancy Firm—RK Franchise.
According to Kotik, what is exciting starting this year for franchising industry in the Philippines is the management changes, of which companies are dominantly managed by the new generation or younger company owners.
This generation, he said are more aware of the benefits and business opportunity offered by franchising packages, as a way of fast tracking a growth of a business, no longer in the traditional concept.
“A lot of company founders retired and their second generation is embracing into Franchising,” he said.
Although, Kotik mentioned that there are still a number of entrepreneurs, or business owners who are still do not recognize the advantages brought about by opening a business into franchising, or starting a business through franchise.
“We are working hard to educate businessmen to take advantage of franchising,” he said adding that the Franchise Expo, will not only showcase businesses that are available for franchise, but it will also provide expert advise and sound know- how to enter into franchise business, through seminar, scheduled on the second day of the exposition.
This year’s exhibitors include; unique business concepts like the First Medical Laboratory franchise offer of Medicus from Iloilo; Kiddie Ride company, water refilling companies.
According to Kotik, water refilling companies have strong come back this year. There are a total of Water Refilling companies that are offering their businesses for franchising opportunity. Likewise, the beauty and wellness sector or personal care, food franchise are the most popular offerings.
“Food Franchises generally have the highest volume in number of sales and also in number of Franchise outlets. Again followed by beautification businesses,” he said.
Because of financial sensitivity, the pricing of Franchise offers have become stagnant in the last few years, “probably due to increase of competition among franchise companies.”
For a legit franchise one may need at least P300,000 as capital for just a Food Cart type of business.
“Beware of the cheap cart franchises, most of them are scams. Salon Franchises require at least P1.2 Million depending on the size such as OHair Salon or Myface Salon and while restaurants offer from P2 million to P15 million package,” he reiterated his warning.
This year’s Franchise Expo gathered around 200 Franchise Opportunities, occupying the total of 60 booths. (FREEMAN)