Franchising industry revises growth target upward to 'conservative' 25%

With a growing number of people wanting to get into franchising, the franchising industry has revised its 2012 sales growth target to 25 percent, up from the previous 15 to 20 percent—and the new forecast may even be a cautious one, says an industry insider. "We still consider the 25-percent growth a conservative target," said Association of Filipino Franchisers Inc. (AFFI) executive vice president Ricardo Cuna at the sidelines of a press briefing in Makati on Thursday. "Right now, we already have 80 members and we have scheduled the induction of 18 new members soon, making us more confident of further growth," he added. In 2011, the sector posted $11 billion in sales, 17 percent higher than its total sales of $9.4 billion in 2010. Cuna said that the bulk of the franchising is in food outlets, including successful local chains such as Goto King and Figaro, with franchises in the services industry increasing as well. He added that there are an estimated 200,000 franchises in the country with an average of four to five employees each. According to a report from the University of Asia and the Pacific, franchising accounted for 5 percent of the country's total gross domestic product in 2011. The UA&P report also states that the majority of franchisers are based in Metro Manila, followed by the Central Luzon and Southern Tagalog regions. Western Visayas and Northern Mindanao have the largest number of franchises in Visayas and Mindanao respectively. The Philippines' franchising industry is now fourth in the world and the leader in the ASEAN region in terms of the number of franchise concepts and franchise outlets. — BM, GMA News