Expand to Asean, PH firms urged

Philippine firms stand to benefit greatly from an expansion into the Asean region, especially when the Asean Economic Community is established in 2015, according to the country’s “champion of franchising.”

Samie Lim, chair emeritus of the Philippine Franchise Association, noted that many aspiring franchisors regard the US and Europe as the most lucrative markets for expansion.

“But the future is not there. It is in Asean,” claimed Lim in his speech at the recently concluded Franchise Asia Philippines 2013 International Conference.

Lim explained that franchising was all about numbers, which the highly anticipated Asean Economic Community—set to open many doors of opportunities with the free movement of goods, services, investment, skilled labor, and freer flow of capital—can provide.

According to Lim, the member-nations of the Association of Southeast Asian Nations (Asean) have a combined population of 600 million, cover more than 4 million square kilometers of land, and have a combined gross domestic product (GDP) of $2.2 trillion.

“But unlike the European Community, in Asean, trade with external partners is far more significant than intra-Asean trade. So for many years, Asean worked towards  strengthening its cooperation with its six major trading partners—Australia, China, India, Japan, New Zealand and South Korea. More effort has in fact been given to the advancement of ASEAN+3, now ASEAN +6, than unifying the member states,” Lim explained.

“So what does this mean for us? When we go to Asean, we are no longer limited to the 10 countries, opportunities extend to the +6 with the different trade agreements that we have with them as a regional trading bloc. Asean+6 is approximately 3.3 billion people, has a combined GDP of about $17 trillion, and accounts for about 40 percent of world  trade,” he added.

Lim also pointed out that the Asean does not only have a large population, but it also has a young population that will provide a sizable future domestic output, which is expected to drive higher consumption of goods and demand for services.

“[The Philippines has] the most vibrant franchise industry in Asean and I can confidently say that the Filipinos know franchising more than anybody else in this region. We already have a handful of brands out there but we still have so many more that are ripe for overseas  expansion,” Lim noted.

“Today, there are more brands coming in [the country] than going out, so I’d like to encourage all of you to explore Asean and when you do, I hope that you’ll be as proudly Filipino as this one. Let us work together towards making the Philippines as a true franchising hub of Asia, not just by being a gateway to the region, but by also exporting more proudly Filipino franchised brands,” Lim told conference delegates.

Lim also said during the conference that there was growing demand for healthy food franchises serving fast-food favorites using organic grass-fed beef, non-processed cheese, fresh produce and fresh cut fries cooked in olive oil.

Also expected to generate revenues are meal replacements, weight loss tea, cookies and 300 calorie gourmet meals.

Another trend is related to technology, Lim said.

A restaurant in London, he said in his speech, uses an E-table, the world’s first interactive food ordering system, while some clothing stores in the US have 3D scanners that take body measurements to determine the brand, size and style that will best fit customers.