By Vincent Mariel P. Galang
BEHIND a successful franchisee is an equally successful franchisor. The founders of Francorp Philippines’ newest brands shared the challenges they faced and the “secret sauce” to succeed in franchising.
“The Philippines is the largest franchise market in SEA (Southeast Asia) and no. 7 in the world. The appetite for franchising among Filipinos is increasing, as we see more millennials and OFWs (overseas Filipino workers) wanting to be their own boss by investing in franchises,” Sam Christopher Lim, chief marketing officer of Francorp Philippines, said in an email to BusinessWorld.
“Food continues to be the biggest in terms of franchising (42% of the market), but services are growing fast,” he added.
Francorp Philippines is part of the worldwide franchise consulting firm Francorp, which is based in Chicago. It also has consultants in South America, other part of Asia, Middle East, and South Africa.
For Francorp Philippines, its client account for 25% of the total franchises in the country and works with more than 5,000 entrepreneurs per year through seminars, events, and other activities. Some of its clients are Jollibee, Potato Corner, Max’s Restaurant, Chatime, Goldilocks, and Pancake House.
During the Franchise Asia Expo 2019 held from March 29-31 in Pasay City, it introduced 23 new brands that are now available for franchise. These include Samgyeopsal House, a Korean barbecue restaurant, and Varda Flame Grill, a burger stand.
Jesi Lee Edrina, co-founder of Samgyeopsal House, said that one of the challenges faced by the restaurant while establishing the business was the trial-and-error stage. The Korean barbecue food chain was founded in 2017 after its founders transformed its gourmet burger joint in Tondo, Manila.
“Of course, you would buy some equipment na hindi mo naman kailangan (that you do not need) and then eventually ibebenta mo rin s’ya tapos (you will sell it then) later on ’pag talagang malaki na ang (if there will be a bigger) demand bibilhin mo na naman s’ya (you will buy it again), so the trial and error is the biggest challenge that we had,” she told BusinessWorld in an interview during the Expo.
For example, in their early days the founders of Samgyeopsal House bought a meat cutter then sold it thinking that it will not be needed in the future only to realize that it will be essential once the business become bigger. Also, several of the air conditioners malfunctioned too soon after a failure to realize the need for proper ventilation for this kind of business.
As for Chris Guarin, founder of Varda Flame Grill, the main challenge was looking for the right people who he can trust with the business.
“Manpower is definitely one the biggest factor to consider. The frontliners are your soldiers everyday. They face your customers everyday, so you have to train your staff and to really make them as family so they would care for the business,” he noted in a separate interview.
Varda was founded in 2016 by Mr. Guarin, who formulated the business after getting inspired by the long line in a burger stand located near his alma mater.
With the goal of fully involving his employees in the business, he made sure to teach the staff of the essential values that a business owner should have.
“We teach our staff the values of entrepreneurship na kung ikaw ’yung may-ari gagawin mo ba ’to? Kung sa’yo ’to, sasayangin mo ba ’yung kamatis? (that if you are the owner will you do this? If this was yours, will you waste the tomato?) [As] simple as that. We teach them the values of integrity. If you teach your staff, your soldiers particularly, your employees as your family members, that would be one of the things that would make you win as an entrepreneur,” he said.
“You may have good products, you may have a good brand, but if you don’t know how to hold your people as your own it won’t work,” he added.
Ms. Edrina said with Samgyeopsal House success, its founders now wish to share this success with potential franchisees.
When asked about her advise to future franchisees, she said, “If you really want to have a franchise, dapat kilalanin mo ’yung (you have to know the) brand na kukunin mo (that you will get), and also not because Samgyeopsal business is a trend.”
“But of course it has to be something you love as well. You have to love your product before you do the business,” she added.
Mr. Guarin shared the same sentiments, saying, “It has to be puso (the heart). Franchise is not all about choosing a renowned brand or choosing a proven brand because even though it’s a famous brand if you will not run it well, it’s nothing.”
“You should have the heart. It has to be something that you really love to do because [otherwise] you will fail. You have to accept the fact that you will fail but what’s important is you will learn and you will keep on moving,” he added.