Best franchises are 'close to daily life'
Published on Jun 22, 2004
Franchise businesses that play a close role in people's daily lives are among the most popular businesses in the Asia region, a Singapore exhibition organiser says. Educational businesses such as music, special languages and dance, health and beauty-related services and products, plus jewellery and accessories, and information technology all have great potential, Ben Wong said. Wong, project director of lifestyle events for Singapore Exhibition Services (SES), said recently the reason for the popularity of franchise businesses is because they tie-in with people's lifestyles. "Consumers in the market always change, however. So it depends on how well the entrepreneurs in the industry adapt themselves to the change. The life cycle of a franchise business could be two or 20 years," he said.
One franchise sector that was always popular and will continue to be is food and beverages, he said. However, operators changing all the time as there are always new entrepreneurs introducing new things and consumers needs constantly change, he said. Well-known Thai franchise businesses in the region involve food and beverages, as well as health and beauty businesses. Wong said franchise businesses played an important role in the business world globally.
China, he said, had 1,000 franchise firms in 2001, a 40-per-cent increase from the previous year. And these, he said, generate revenue growth of 40 per cent annually. In the same year, Australia had 500,000 employees in franchise businesses that together generated 80 billion Australian dollars (Bt2.2 trillion). Wong also talked about the licensing business, in which a company that has a strong brand can sell rights to other firms for use of their name. He said that figures in 2001 showed that the licensing business in Asia generated US$25 billion (Bt1 billion), accounting for 17.8 per cent of global business revenue. Southeast Asia and Japan together generated $11 billion, which accounts for one-tenth of global business. Some 70 per cent of the top 100 companies in the world also grew through licensing deals last year when compared to 1985, when only 10 per cent grew via licensing programmes.
More Asian companies were using franchise and licensing systems to help them expand their network at the regional level, Wong said. SES is organising the Global Franchising & Licensing 2004 (GFL 2004) exhibition, the sixth international event for business opportunity and intellectual property rights, at Suntec in Singapore on September 15-17. Fair organisers expect 260 companies from 22 countries to participate. This is 25 per cent higher than last year, Wong said. The companies that attend the fair will showcase lifestyle, fashion and entertainment brands, corporate trademarks and character licences. Thailand's Department of Export Promotion (DEP) will sponsor 90 per cent of the expenses for 11 Thai companies participating in the exhibition. Among the 11 companies are CSC Foods, Coffee World Corporation, Earth Star Diamond, Sarolux, and Ticketonline. Nitida Asawanipont THE NATION
Article by: The Nation