[dropcap]D[/dropcap]omestic franchising industry now comprises around 10 percent of the multibillion-rupee market. Seeing the foreign franchisers prospering the local franchisers are going ahead and making satisfactory progress. Most businesses fail to go for a good start because they are totally dependent on their own and lack enough finances to emerge all the ideas required to make a company successful. The idea of franchising has become significantly attractive to investors and businesses as it helps them to lessen risks and to break even early by letting them benefit from the goodwill and experience of the franchiser.
Franchising is an arrangement where the franchiser lends the franchisee its name as well as certain systems and processes to produce and market goods or services, in exchange for a franchise fee and ongoing royalties on sales.
Food, retail and services remained the top three franchising industries in Pakistan. Other segments are also establishing ahead, including footwear, clothing and pharmacies. Top local franchisers include 14th Street Pizza, OPTP and Chacha Jee, while leading foreign franchisers are Pizza Hut, KFC, McDonald’s, TGI Fridays and Subway.
Some popular brands in areas other than the food sector include Marriott, Ramada Renaissance (in the hotel sector); Brinks, Wackenhut (security); Avis (car rental); and DHL, TNT, United Parcel, Federal Express (courier services).
In franchising business the business expands better, the brand gets greater visibility and one do not spend any money doing it because it is all paid for by the franchise.
Apart from its many benefits of concerns remain that franchising in our part of the world has not impacted individuals.
Pakistan is the fourth biggest franchise market. After the tremendous development of telecommunication, banking and media in the last twenty years the next big impact in Pakistan will be made by retail marketing.
Franchising has increased in Pakistan in the last few years. Pakistan is the fourth biggest market in terms of franchising local and even international brands.
Pakistan has more than 30 malls to be opening all over the country by 2017, which means more business and more international brands coming to the country.
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Franchising has increased in Pakistan in the last few years. Pakistan is the fourth biggest market in terms of franchising local and even international brands.
There is an opportunity to expand domestic brands through the franchise model. There are many businesses in this country that have made a name for themselves with years of unprecedented customer service and constantly fulfilling their brand promise.
Franchising is greatly a profitable expansion in the country but it is also a relatively new concept in our market. No matter how profitable a business is, its adaptability in different domestic or regional markets must be researched and verified.
Many of Pakistan’s leading clothing brands are already enjoying presence in regional hubs like Dubai or even as far as the United Kingdom.
Our consumer brands; particularly food and clothing brands hold great potential in global markets as they are sought after even where they do not have physical outlets available.
As long as Pakistani businessmen are willing to commit the investment, expertise and resources required; there are domestic brands that can successfully compete at the global level.
There are many very well educated business owners in Pakistan that have travelled the world and seen the benefits of franchising for a growing business.
In Pakistan consumer spending patterns are also changing, urbanization is increasing, the adoption of technology and innovation is on the rise and standards of living are improving for many. Therefore the domestic market is aimed for growth through franchise model.
Entrepreneurship in Pakistan is facing number of challenges such lack of financing, unfriendly regulation, lack of business-related subjects in schools and colleges and rampant corruption. All these factors discourage new business set-ups.
In this dismal environment, there is a unique business model, which is the concept of ‘franchising’. It is well-known fact that starting a new, even a small business is not an easy job.
The problems and challenges for new start-ups are substantial, but many of these challenges are lessened in the available ‘franchising’ model. In the US, it is estimated that there are over 900,000 franchise businesses, providing over 18 million jobs and adding $2.1 trillion to the economy. There are over 300 different industries and business categories using the franchising business model.
It is projected that every 8 minutes of every business-day a new franchise business opens. Our government must work towards creating an environment to help this model.
This includes introducing a fair trade franchising legislation, proper code of conduct, promulgate intellectual property laws and provide appealing tax rates to attract investors.