■ ‘ASEAN INTEGRATION FAILS TO BOOST FRANCHISING'

The franchising business remains undeveloped in Association of Southeast Asian Nations (ASEAN) member countries, an industry practitioner lamented. Robert Kotik of RK Franching Consultancy said that Philippine players dominate the franchising industry, with expansions focused in the Middle East. As interest among Arabs in franchising Philippine-produced food and vanity establishments grows, there is still minimal presence of franchisees in the Philippines from other ASEAN countries.

Despite economic integration among Southeast Asian countries, the franchising business remains undeveloped among the 10-member alliance in the region, said an industry practitioner.

According to Robert Kotik of RK Franchising Consultancy, franchising remains dominated by Philippine players. If there are expansions outside, these are mostly in the Middle East.

“When it comes to Asean integration, nothing is going on, honestly,” said Kotik, referring to the minimal presence of franchisees in the Philippines from other countries in the Association of Southeast Asian Nations (ASEAN), and vice versa.

But there is a growing interest among Arabs in franchising Philippine-produced food and vanity establishments.

“We are exporting a lot of local franchisees, but 90 percent (of the exported franchised brands) is in the Middle East,” said Kotik.

“In the Middle East, there is demand for it so we are giving them the supply,” said Kotik. Most of the franchises in the Middle East are in partnership with Arab and Filipino entrepreneurs, Kotik added.

The Middle East still has one of the largest presence of overseas Filipino workers (OFWs). Philippine franchising is the largest in Southeast Asia, said Kotik, of which 50 to 60 percent is in the food business.

About 2.29 million Filipinos were based in the Middle East and Africa as of June 2015, according to government estimates. After the United States, it’s Saudi Arabia that hosts the second largest concentration of Filipinos abroad, at nearly one million as of December 2014.

Vanity franchises like salons and beauty products or services are a “fast-growing” segment locally and in the Middle East, being easier to expand and transport compared to food.

Generally, Kotik believes franchising is the “safest” way to invest one’s hard-earned money. In franchising, there are proven concepts, business systems, training, and branding, among other perks.

In the Philippines, Kotik said one can avail of a franchise for at least P500,000, particularly allin, stall-type concepts.

On March 3 to 5, RK Franchising Consultancy and its partners will hold the 18th Cebu Franchise Expo at the SM City Trade Hall, where at least 70 franchisors will join. There will also be seminars on March 4 by Kotik, who will explain franchising to prospective franchisees and franchisors. Trademark specialist Sokri Malaco will explain the importance of trademarks, and how to get and use them.