Back to Fundamental: Food Patronage Through Franchising

Passing by that new techie store with their all-new mobile model displayed on their window, you can’t resist checking your personal savings account and see if you’ll be able to buy one. But wait, on the way you heard the growling of your stomach. Well, no doubt, you go directly towards the nearest fast food chain inside the area and grab that piece of cheeseburger that suits your taste. This is exactly the explanation why food franchising is starting to be increasingly more hit and prosperous all over the world.

Passing by that new techie shop with their all-new mobile phone design displayed on their window, you can not resist checking your personal savings account and see if you’ll be able to purchase one. But wait, on the way you heard the growling within your stomach. Well, no doubt, you go straight towards the nearest fast food chain inside the location and grab that piece of cheeseburger that suits your taste. This can be exactly the explanation why food franchising is starting to be more and more hit and successful all over the planet.

Food is a vital commodity. Eating is unavoidable. That is certainly why considering of new products to promote out there might be tricky; but thinking of that elementary commodity that humans cannot live without and turning it into something stylish can be lucrative, and ensure longevity. Specially that meals are the first on the list when we discuss hang-out, salary pay, and parties.

Palatable fashion sense is king. The availability of major points of innovation and modification in existing recipes; and experimenting with the consumer’s taste buds brought in a variety of product franchises to consider from.

1. Fashion Fruit. There could be a lot of dishes and palatable goodies which can be created out from the abundant fruits. Artistically presented fruit shakes, natural fruits, fruit mix, dried fruits, spread, jelly and jams are in demand despite many different brands.

2. Meaty Rolls with a Twist. This includes majority of those available in kiosks and food stalls i.e., hotdog on-stick, roll or sandwich, quick meal toppings, and balls.

3. Cafe and Latte Culture. Coffee culture has pointed out the significance of coffee to the body. Coffee product made its way in the consumers’ diet and caters the requirements of young professionals and has turn out to become a component of their routine.

Food can definitely be a low-cost investment. Starting up your personal food business may be expensive with all preliminary ingredients, devices, and quota to be achieved. What’s wise with franchising is that the mother firm shoulders initial inventory and provision of such equipment and ready-made recipe with a capital that could be as low as 25,000 to 35,000 pesos. Even those with low socio-economic status can grow to be entrepreneurs.

Safe and authentic product via franchising is assured. Food business is fairly specialized and complicated because it also deals with sanitary criteria and health assurance. With franchising, the franchisee absorbs an already tested system of business plan which has conducted its own sanitary practices and has been accepted legally. Furthermore, operational requirements may also be acquired with the company’s support.

The PFA (Philippine Franchise Association) says that 43% of franchising in the country covers food franchising. It grew by essentially 450% from only 78 systems in 1995 to almost 430 nowadays. This shows that food business is the most sought-after business plan; and it is hardly ever too late for you to engage in one.

Want to get into the food franchise industry in the Philippines? We will help you! Go to our blog at Franchising in the Philippines to check tips, articles and opportunities!

What is Franchising

Imagine you are an unhappy office staff, working more than eleven hours a day, and noticing playing by the rules does not give you what you wanted and it only made you old and busy.

Going entrepreneur came into your mind. But, with all those news about traditional firms closing left and right, the horror prevent you from taking action.

Yet, you still find in the newspapers, in the TV and in the internet, companies offering franchising. Maybe this is the type of business for you. And you are intrigued. You ask yourself, what is franchising, anyway?

This article is going to tackle the definition of a franchise.

Franchising is a practice where a corporation permits another entity to use the company’s already successful business solution. The franchisor (the company that provides the business solution) and the franchisee (the entity that uses the business solution) enter into a contract to use and capitalize on the company’s successful business solution and/or its existing brand awareness (most often called Goodwill) for a faster return of capital.

In return, franchisees pay two payments in general. First is a one time investment, called the franchise fee, and the other is royalty fee, which is a recurring expense, for the continuous usage of the business model, advertising and training costs. Royalty is usually 3-10% of gross income.

Franchising is a interconnected network of mutual business relationships that permits a number of people to share:
• A brand identification
• A successful method of doing business
• A proven marketing and distribution system
That’s pretty what much franchising is.

One common mistake about franchising is the phrase, “I am buying a franchise”. You are not buying; you are investing onto the business. What you will own are the physical assets that are needed to act upon the franchise, like the building and equipment.

For a business to work as a franchisor, it must have a good track record of profitability and the business solution it employs is duplicable. Otherwise, that business is not suitable for franchising.

What’s so great about franchising?

For the franchisor, the business can grow and gain more chains while lessening the traditional risk and liability of doing so. It is also a great way to gain more brand recognition and reputation.

For the franchisee, they are investing in an already proven business solution and recognized brand. In fact, a franchising business is 90% proven to be successful. With a success rate like that, who can go wrong?

About the author:
Rothman, also known as Kapalbility is an internet marketer and a franchising expert, specializing in small business solutions like food cart franchise businesses in the Philippines. Learn from him through his blog, Franchise Philippines.