Franchising  DEDICATED TEAM OF EXPERTS - Solid

Marketing, Operations and R&D

 Founded in 1995. The Voice of the
 PROFIT POTENTIAL - Predictable through
 Philippine Franchise Sector -PFS
control systems
 The country’s pioneer franchise association
 Members include the country's biggest Why buy a franchise?
franchises - both local and foreign
 BRAND NAME/BRAND RECALL
 A voluntary self-regulating governing body
 BUYING AND ADVERTISING POWER
 The only internationally – recognized franchise
(Consolidated Vol.)
association in the country of the APFC and
 TRAINING
WFC
 LOWER RISKS
Franchising has a 90% success rate versus 25%  TURNKEY/ESTABLISHED TOTAL CONCEPT
startups.  QUALITY CONTROL
 PROFIT POTENTIAL
What is Franchising?
 BUSINESS SYNERGY
Duplicating the success of a successful business.  LONG-TERM
You’re in a business for yourself, but NOT BY TRAINING AND SUPPORT
YOURSELF.
 PRE-OPENING
PRODUCT DISTRIBUTION FRANCHISING  LOCATION ASSISTANCE
 Supplier/ dealer relationship  CONSTRUCTIONS
 Franchise merely sells the franchisor’s products  INITIAL TRAINING
 SET-UP
BUSINESS FORMAT FRANCHISING  MARKETING
 ON-GOING
 Full integration of the business
 ASISSTANCE (HOTLINE AND VISITS)
 Franchisee not only distributes the franchisor’s
products and services under the franchisor’s  PRODUCT RESEARCH AND
trade mark, but also implements the DEVELOPMENT
franchisor’s format and procedure of conducting  MARKETING AND ADVERTISING
the business  ON-GOING TRAINING

FRANCHISOR CHALLENGES IN FRANCHISING

 Parent company - Territorial restrictions

 Owner of the brand and operating system - False expectations
- Consistently follow the company standards
 Systematizing a successful business
and systems
 An expansion strategy
 Brand building activity ELEMENTS OF A FRANCHISE AGREEMENT
FRANCHISEE  Parties
 Appointment and Franchise Fee
 “Active” investor/operator
 Term and Renewal
 Freedom to own a business  Designated Location, Relocation Requirements
 Be your own boss!  Supplies and Services
Benefits of Franchising  Training
 Proprietary Marks
 FOUNDATION - Strong brand name, brand  Confidentiality
recall  Modification of the System
 PROOF OF CONCEPT - Proven systems and  Advertising
procedures  Royalties, Continuing Services fee, etc.
 Accounting of Records
 Standards of Quality and Performance
 Operations Assistance
 Parties
 Appointment and Franchise Fee
 Term and Renewal
 Designated Location, Relocation Requirements
 Supplies and Services
 Training
 Proprietary Marks
 Confidentiality
 Modification of the System
 Advertising
 Royalties, Continuing Services fee, etc.
 Accounting of Records
 Standards of Quality and Performance
 Operations Assistance
How to be a successful Franchisee?
- Be a good follower
- Create a business plan
- Be a hands-on manager
- Manage your finances
- Always market your store and its products/
services
- Be willing to share with your franchisor ideas
that will help improve business
Do your due diligence
- Visit the franchisor
- Training and support
- Study financial projection
- Check IPO registration
- Check litigation history
- Review franchise agreement
Signs of Franchise scams
- Too good to be true claims of profitability
- Pressure Tactics when selling their franchises
- Absence of list of franchisees
- Absence of list of outlets
- Vague company profile (list of officers not
specified)