AN OFFICIAL of the Philippine Chamber of Commerce and Industry (PCCI) has encouraged Cebuano entrepreneurs to explore franchising as a viable growth strategy for expanding their businesses.
Speaking during Day 2 of Padayon Cebu: A Summit to Inspire, Promote and Grow SMEs on Wednesday, June 26, 2024, Ma. Alegria “Bing” Limjoco, former president of the PCCI, pitched franchising as an expansion option for entrepreneurs to scale up their businesses and as an option for aspiring entrepreneurs to venture.
The MSME summit is part of the 2024 Cebu Business Months celebration organized by the Cebu Chamber of Commerce and Industry.
Limjoco shared the success story of the flavored fries brand Potato Corner, whose franchise network now includes international locations. She highlighted that Jo Magsaysay’s simple idea, combined with his relentless dedication, enabled the brand to grow significantly. As of the first quarter of 2024, Potato Corner represents the Philippines with 1,874 stores and outlets both domestically and abroad.
“We urge our MSME owners to contemplate on franchising as a viable growth strategy. We have an abundance of resources to assist you in your franchising journey,” said Limjoco, who is also touted as the country’s “mother of franchising.”
According to Limjoco, the franchising business model allows an entrepreneur to manage risk and have full control of the business even if the business is owned by someone else.
“Franchising is duplicating the success of the business,” she said.
Franchising allows businesses to expand rapidly with lower capital investment and risk, leveraging the efforts of franchisees who have a vested interest in the success of their individual locations.
Franchisees gain the advantage of operating a business with a proven track record and established brand, along with the support and resources provided by the franchisor.
Magsaysay’s Potato Corner, which opened its first outlet in the Philippines in October 1992 and began franchising a year later, was acquired by Shakey’s in 2022.
Government programs
In addition to considering franchising as a strategy to scale up their businesses, Limjoco urged MSME owners to leverage various government programs to enhance their financial practices and boost profitability. Some of these programs are in partnership with the PCCI.
She cited several initiatives offered by the Department of Trade and Industry (DTI) such as P3 Program (Pondo sa Pagbabago at Pag-asenso), a funding program that will provide an alternative source of financing for micro-entrepreneurs that is easy and quick to access and the Kapatid Mentor ME (KMME), a program that aims to help MSMEs scale up their business thru coaching and mentoring.
She also promoted DTI’s Negosyo Centers, a program responsible for promoting ease of doing business and facilitating access to services for MSMEs and PPG (Pangkabuhayan sa Pagbangon at Ginhawa), a post-disaster response livelihood seeding and entrepreneurship development program of DTI which aims to assist individuals and families affected by fire incidents and other calamities, including health disasters like the Covid-19 pandemic, to recover and/or start their businesses.
Aside from tapping government resources, Limjoco also urged business owners to embrace the use of digital tools to enhance efficiency, productivity and profitability.
Staying up-to-date with the latest technological advancements can give businesses a competitive edge, allowing them to innovate and offer superior products and services.
According to reports, the Philippine Franchise Association aims to increase its member brands’ franchise stores by eight to 10 percent this year, driven by the nationwide expansion of local franchises and the entry of foreign brands into the market.
The growth forecast of 10 percent is translated to P34 billion in terms of revenues this year from an estimated P30.5 billion in 2023. The group is confident of the continued growth of franchising as more Filipinos are now aware of franchising as a business concept. / KOC