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Poll spending buoys local franchise industry

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Domestic franchising industry is expected to grow by as much as 30 percent in terms of sales revenues driven largely by the election spending and strong remittances from overseas Filipino workers, reported the Manila Bulletin.

Samie Lim, chairman emeritus of the Philippine Franchise Association, said this after the industry posted over 20 percent increase in sales last year to P121 billion over 2008 performance of its 153 members and 180 brands based on the PFA-UA & P study on Profile of Philippine Franchising and Economic Impact.

Our first few months this year posted record sales and there is optimism during the election because the election campaigns would fuel up consumption for food and services. The money flowing in now is coming from the politicians but after the election, it will be the money from the hardcore investors, Lim said.

Lim said that food and services are very strong but the retail sector is also becoming in very strong. In services, the growth would mostly come from the tourism sector noting that the Philippines is going to follow the US trend wherein the number one growing sector is hotel services.

Most of the franchises are located in the Luzon with 83 percent of total followed by Visayas with 11 percent and Mindanao 6 percent but Lim said that the potentials are outside of Luzon. He noted that one store in Mindanao has already 50 outlets but no branch yet in Manila.

PFA chairman and Max s Restaurant president Robert Trota said that the franchising industry contributes five percent of the country s GDP.

There are over 1,000 franchise brands in the country with 115,000 outlets or an average of 115 outlets per brand.

The sales revenues do not include the sales and growth of 17 Philippine franchises overseas with 325 outlets already led by Bench and Jollibee with 62 branches each and Red Ribbon with 39.

The US remains the most preferred country for Filipino franchises followed by Indonesia, rest of Asean, China and the Middle East.

Lim also revealed that 20 new foreign franchises are coming in this year even as Philippine franchises are going strong abroad.

The golden years of franchising is coming to the Philippines in the next few years. And next year where were hold the World Franchise Council is a good year because we have a new administration, he said.

The PFA will stage the 18th Philippine International Franchise Conference and Expo on July 14 to 18 at SMX Convention Center, which will also set the stage for the World Franchising Conference here next year.

Lim also revealed plans of PFA to establish an office in China to promote some of the already internationally-ready franchise to establish in China.

They are also pushing for local franchises to promote themselves in Guam as a stepping stone to the US market.

Other destinations of Philippine franchises include India and Asean, but the next wave of foreign franchises coming in are expected to come from France for fashion and designs followed by UK, Spain, Germany, and Italy.


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