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Monday 28th November, 2022

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Asia Excites
Asia Excites

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Asia Excites

Albert Kong explains why the Far East is currently a hive of master franchising activity

Let me begin by using one of the paragraphs in HSBC’s ASEAN Connect webpage: “The last 50 years has seen a transformation of historical dimensions as the nexus of global activities shifted towards Asia. The magnitude of this seismic shift in economic authority towards Asia is on par with the discovery of the New World and the subsequent rise of North America as a major production and consumption center…Are Vietnam, Cambodia and Myanmar the next Asia tigers?”

At the risk of sounding simplistic, I maintain that the growth or decline and the trends in franchising are very much a reflection of the economy and the needs and wants of the society in question. Raging ahead, as far as their economy is concerned, are the likes of Vietnam, Cambodia, Myanmar in ASEAN. Even developed ASEAN countries like Singapore, Thailand and Malaysia are still experiencing economic growth, albeit at a slower pace. Not forgetting giants like China (6.5% growth) and India (7.3% growth), which are still faring well thanks to their strong domestic consumption, compared to Europe and the USA.

A quick click on my company’s website on the franchising shows in Asia in 2017 will tell the story http://www.asiawidefranchise.com.sg/event-diary. Note: I have only listed those in which that my company is participating. Smaller shows in other cities (e.g. Makassar, Indonesia; Penang, Malaysia) or those organized by entities that are not members of the World Franchise Council (there are many) are not listed. In my opinion, big national strategies e.g. China’s Belt and Road Initiative (BRI) that will affect 60 nations across the world, with many in Asia, will give positive spins to the said nations, thus making many parts of Asia even more vibrant. Using Maslow’s Hierarchy of Needs as my argument, many franchise brands that are being ‘aspired’ will find many wooers in these now-more-developed nations.

Master franchise opportunities

I have often heard friends in the Western world lament the fact that their governments are not as ‘generous’ as those in Asia when it comes to supporting franchising. True. In Singapore and Malaysia, grants and subsidies are available for aspiring franchisors to engage consultants and lawyers to embark on the franchising journey. There is also government assistance in the promotion of franchise brands in Thailand, Philippines and Indonesia, all at varying degrees.

Judging by the number of western brands that have approached my company in the past year or so to help them find franchisees in Asia, it is evident that these franchisors are cognizant of the above scenario. And not just western brands, but also brands from within Asia (e.g. Korea, Japan and Taiwan).

At our booth (we go to 30 events a year), we have been getting franchise inquiries from many nationalities including individuals and business development managers from China, Vietnam, India, Indonesia, Myanmar and Sri Lanka – all wanting to become franchisees of established brands. This is despite the fact that there are occasional reports about the disputes between franchisors and franchisees, or a certain franchise brand going bust.

In short, the days ahead are rosy indeed.

ABOUT THE AUTHOR

Albert Kong CFE, CMC, Senior PMC is the Chairman of Asiawide Franchise Consultants, which has helped more than 680 companies in Asia to embark on franchising. He has been awarded by franchise associations in China and Taiwan, and the Asean Retail Chain & Franchise Federation (ARFF) for his contributions to the growth of franchising. He also co-authored Developing & Managing a Franchise (LexisNexis) and is frequently interviewed by the media. www.asiawidefranchise.com.sg

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