Ministry mulls lower fees to attract young franchisors
KUCHING: The Domestic Trade and Consumer Affairs Ministry (KPDNHEP) is looking at lowering the franchise fees for certain businesses in a bid to encourage more youth participation in the franchise industry, says minister Datuk Alexander Nanta Linggi.
“We are now looking at how we can bring down the entry point in terms of investment, from few hundred thousand ringgit for established brands, to RM50,000 as a start-up.
“We are working very hard to see what are the particular types of business that we can do it at that RM50,000 entry point,” he told reporters after a ‘Pocket Talk’ session with some local franchisors, hosted by the ministry and Malaysia Franchise Association (MFA) yesterday.
Nonetheless, Nanta acknowledged that not all industries could be entered with lower franchise fees.
“Some, by nature of their products, cannot be that low, while some can. We will review the types of business,” he said.
He stressed that it was important to get this done in order to create opportunities for the young people who wanted to be entrepreneurs.
“New, budding entrepreneurs always face problems with capital. So if we could bring (the entry fees) down to RM50,000, definitely more people could afford to go into franchise business. Hopefully, we could assist young people in becoming entrepreneurs through the franchise system,” he said.
He added that it would not
We are working very hard to see what are the particular types of business that we can do it at that RM50,000 entry point. Datuk Alexander Nanta Linggi
matter whether those interested were urban or rural youths, but he believed that it would surely empower the rural youths.
“If we could achieve this, we could assist many young people – at least give them an opening into business.
“Malaysia is a trading nation; this is the best way to go forward and to assist people into small and medium enterprises (SMEs),” he said.
Nanta also revealed that his ministry was developing a masterplan for the franchise industry, which was why the Pocket Talk session was held.
“We are taking into account the feedback from franchise industry players to develop this masterplan.
“The masterplan will become the guideline to further develop the franchise industry, and will be used until 2025,” he said, adding that it would likely be launched next year.
Earlier during the session, the minister pointed out that the franchise industry had a huge potential in Sarawak and that it could help in developing the economy and domestic trade, especially moving forward post-Movement Control Order (MCO).
Realising that the industry was not spared from the impact of the Covid-19 pandemic and the MCO, he said his ministry would be ‘ever-ready to assist’.
“We cannot take responsibility for business losses, but we can assist businesses get going again, such as making things easier and giving concessions in certain matters. This is why we have this session – we are ready to listen and help.”
Nanta invited the franchise industry players to take part and support the ‘Buy Malaysian Products Campaign’, which would be running from the middle of this month until December.
“The campaign will be launched by our Prime Minister in a few weeks’ time. I urge all industry players to join – does not matter what businesses (they are in),” he said.