Filipinos no longer need to go elsewhere to start their own franchising businesses, with the wide opportunities that the Philippines provide for aspiring micro, small and medium entrepreneurs (MSMEs), a leading expert in the franchising industry stressed.
“We don’t have to travel far to access the best in franchising. We are the franchise hub of Asia and the biggest franchise show in Asia happens next week,” Sam Christopher Lim, director and chairman of the Asean Integration Committee of the Philippine Franchise Association (PFA), said in an interview last week.
This week the biggest international franchise event this year—the Franchise Asia Philippines 2017 Conference and Expo—will take place from July 19 to 23 at the SMX Convention Center Manila, which will gather powerhouse international and local experts, business leaders and speakers who will be sharing their knowledge and expertise on how potential businesses and entrepreneurs can enter and disrupt the increasingly competitive market in Southeast Asia.
Lim underscored that franchising is about duplicating a successful business using other people’s money, time and people. He noted that the PFA has been instrumental in helping hundreds of MSMEs to grow locally, including brands such as Jollibee, Max’s, Yellow Cab & Bench and continue their pursuit toward Asean expansion. It is likewise a professional, systematic way of mentoring thousands of entrepreneurs, he added.
“First on the list is money; franchising gives you access to almost unlimited capital because the burden of capital is transferred to the franchisees. They invest in the business. They buy products for you. They pay you a franchise fee and you mentor them on how to run a business the right way,” Lim said.
“They pay you loyalties. They even pay you for your advertising, but at the same time, they put in their people, their networks. So our stores are no longer managed by salaried employees; it is now managed by entrepreneurs just like yourself,” he added.
Lim said a wide potential lies for many entrepreneurs and MSMEs, adding that the “majority of brands started as MSMEs, but they need franchising to really scale up”.
Franchising has a 90-percent success rate with nine of 10 franchises continuously growing even after 10 years.
Despite being not known to many, Lim said, franchising in the Philippines continues to grow, with over 1,500 brands in 140,000 franchise outlets.
“It’s almost a hundred outlets for every franchise brand. Twenty years ago, people would dream to have hundreds of outlets, now it is the norm. Now that’s the average,” he said.
While 40 percent of the market is into food franchising, which is a “very diverse segment”, entrepreneurs can also tap into other “vibrant sectors”, such as fashion and retail.
Aside from success stories in franchising, such as Jollibee and Potato Corner, entrepreneurs can also look into other brands that are now moving toward franchising.
“You have fashion [and] retail—we have 7-Eleven a convenience store with over 54,000 outlets internationally. Then you have Holcim Cement, a big cement manufacturing,” said Lim, citing that the leader in cement had put up a Holcim Hub in retail to assist potential franchisees.
“Or a story, this is a very phenomenal success story, the Generics Pharmacy [which is now] reaching more than 1,900 stores in just seven years,” Lim added, citing that the owner of Generics Pharmacy owns and operates only three stores; everything else is franchised.
Potential franchisees can also look into the new “sunrise industry” in franchising, which is health and education, he added.
Lim is also the chief marketing officer of Francorp Philippines, the world’s largest franchise-development consultancy, and president of U-Franchise, the Philippines’s largest franchise sales and marketing company. Having helped grow hundreds of MSMEs locally, he is now helping brands such as Jollibee, Max’s, Yellow Cab and Bench to grow across Asean.
He spent over a decade growing brands globally, holding positions, such as senior global brand manager for Unilever based in London, Bangkok, Shanghai, Manila and Cebu. He currently sits on the Board of Directors of AS Louken Sachi, an international branding consultancy that has helped brands such as Charles & Keith and Bread Talk gain international success through branding.
Lim was also awarded the Young Market Masters Award for his role in growing brands in the Asian region.
Lim graduated with the highest award in Management Engineering from the Ateneo de Manila University, studied in the National University of Singapore and pursued post-graduate studies in Oxford University, UK where his project on “Franchising: An Innovation Strategy Perspective” helped him graduate with honors.
With the growth of franchising in the Philippines, Lim said the industry helped create more than 1.2 million jobs for Filipinos.