FRANCHISING is emerging as a viable investment option for overseas Filipino workers (OFWs) seeking to set up a business in the Philippines. Filipino franchise investment packages have drawn the attention of many individuals who have sought greener pastures abroad but are keen on spending the rest of their lives back home with their families once they've saved enough. It is this motivation of having a better life that is driving an increasing number of OFWs to invest their hard-earned money in lasting and profitable franchise ventures. The success rate of some these homegrown and relatively low-cost, high-viability franchises have prodded more and more Filipinos to invest on them. The Globalpinoy Chamber of Small and Medium Enterprises showcases these franchises at the Ground Floor, Fort-Am Building, Pineda, Pasig City under the auspices of Super Value Franchise Concept Inc.
It is interesting to note that for the same volume of business that can be generated by a foreign franchise brand operator, a homegrown franchise investment package costs 60-80% cheaper. What's even more heartening is that with winning concepts, product quality consistency and a harmonious franchisor-franchisee relationship, these Filipino franchises grow to multiple store operations.
Sheree Santy, 31, a marketing graduate who worked for five years as crew purser for international luxury liners, had long nurtured a desire to run her own business. So while she dealt with the pressures of her job - handling the payroll and immigration clearances for 400 crew members - she was intent on saving enough to achieve her goal. When the Miami-based company she worked for became bankrupt (following the World Trade Center bombing), she decided it was time to go back to the Philippines.
The opportunity to set up her own business presented itself when she met a friend who was a dealer for Lots'a Pizza. She and her family liked the taste, and with an initial capital of PhP350,000 and tons of belief in the product, Sheree embarked on her first Lots'a Pizza franchise venture: a nine square meter kiosk located at the fourth level of Robinsons Place Ermita that reaped a return on investment (ROI) in five months and continues to do well on its second year.
Sheree exemplified the Pinoy entrepreneur who was ready to adapt and go the extra mile to satisfy her customers. She is also thankful for the ample support and continuous product innovation coming from the master franchise holder. Her three-step advice for OFWs who want to reintegrate themselves in the Philippine work scene and be with their families: first, you have to dream: second, make a plan to actualize the dream; and third, save and have discipline to be able to reach your goal.
Better and surer steps in franchising.
Pioneer entrepreneurs have taken out the guesswork from franchising so that some entrepreneurs take on the game without necessarily starting from scratch but by building on already existing strong business names. Although not yet fully grown, franchising business in the Philippines, more and more are going for the option of establishing a business with a strong beginning pitch.
Starting in the franchise business requires a franchise fee which is dependent on the location of the outlet, the necessary equipment and stock and the training of staff to run the store. Aside from those enumerated, the buyer of the franchise (franchisee) really buys the knowledge and marketing savvy of the franchisor. Buying franchises take out the trial and error method of starting a business done specially by inexperienced businessmen who do not know how to systematically start a business, the ins and outs of businesses.
With franchising, the learning process is cut short such as: perfecting the product, getting a good location, creating the system, finding the right people etc. The basic problem of a new franchise holder is how to run a business which have been proven successful in other sites. While the initial investment requirement for a franchise may seem heavy for starters, the advantages of having a completely built up business are evident. Working like a coach and a player, the franchisor and the franchisee must train and work together to achieve their common goal which is to deliver goods and services to people as many locations as possible but without comprising quality.
However, one most remember that, franchising does not yield instant profits. Just like other startup business, franchising has an adjustment period where the patience of the entrepreneurs will be put to a test, a franchise will usually need a six-month adjustment period before profit stabilizes. Returns come in a year or so after and the net profit is usually 10% to 15% of gross sales. The Department of Trade and Industry (DTI) has been supportive of franchising and its potentials. Franchising minimizes the risk of failure since the franchisor has already laid the ground work of the business and the initial training. In addition, a well-known and recognized trademark minimizes the cost of advertising.
However, similar to any other marketing system, franchising does not guarantee success. Like any endeavor, a franchisee needs a lot of patience, attention and hard work to succeed.
The Globalpinoy Chamber of Small and Medium Enterprises (Globalpinoy) invites all interested individuals especially overseas Filipino workers in search of viable business and investment opportunities in the Philippines through the Instant Negosyo or Franchising Program.
The program assists in processing documents needed to establish a new business. It has a list of reputable and seasoned franchise companies with proven track records and financial institutions offering financial assistance in starting a new venture.
www.Kabuhayan.coms.ph