Filipino franchisers explore opportunities in Asean

This year, the Association of Filipino Franchisers Inc. expects to see at least a 25-percent growth in total revenues.

Filipino franchisers are keen to expand their operations in the region as they remained bullish on growth opportunities under an integrated economic community.

With the potential threat from foreign players to their local operations, many of the members of the Association of Filipino Franchisers Inc. (AFFI) are looking outward, whether through a franchising scheme, joint venture with a foreign partner, establishment of a new brand, or supply agreements with foreign companies, said AFFI president Victor M. Fernando.

Among the AFFI members mulling over a regional presence are the Lots’A Pizza, Fiorgelato, Peanut World and Reyes Barbecue brands.

On the sidelines of the recent 2014 Filipino Franchise Show, Fernando said local franchisers were targeting Malaysia, Vietnam and Indonesia, which have all signified increased interest in having more Filipino brands in their countries.

For AFFI, the establishment of the Asean Economic Community by the end of 2015 was further impetus for members to go overseas, as having a fully integrated regional economy will open up the region’s capital and labor markets to competition.

On the local front, Fernando said the main concern among AFFI members was the expected increase in competition once more foreign players bring their respective brands into the

More OFWs and retirees are becoming interested in acquiring a franchise of a homegrown brand

country.

This is why AFFI, through various education and information awareness campaigns, constantly remind its members to prepare for the onslaught through more training and investments in innovation.

Members are also urged to look at the potential business investments that can be secured from the foreign players’ entry into the large domestic market of 100 million people.

Such awareness and education campaigns were aimed at increasing AFFI members’ knowledge of the impact of an Asean Economic Community on their companies, as well as the potential income opportunities.

This year, AFFI expects at least a 25-percent growth in revenues from the P63.4 billion posted in 2013.

Last year’s revenues reflected a 20-percent hike from the sales registered in 2012.

AFFI also saw the growth in the number of franchisees, which was attributed to increased interest by overseas Filipino workers and retirees to set up their own business.

Further fueling the industry’s growth were the strong fundamentals of the economy and increasing development in the countryside.

Potential franchisees check out a booth during the AFFI expo

Another trend in the industry is the development of more non-food franchises, which now account for 45 percent of the franchising sector.

The Philippine franchising industry is currently dominated by homegrown brands that comprise more than half of the franchisors in the country, with its members having a total of 19,312 stores that employ 135,184 people.

AFFI added that a key trend in the industry was the development of “hyper-specialized” concepts that cater to niche markets as well as online and mobile application-based businesses.

There is also a strong demand for self-serve type businesses, such as vending machines.

All these point to the increasing sophistication of the industry, Fernando said.