00:00 [Music]
00:09 Welcome back right here on The Exchange where your business is our business.
00:14 I'm Rico Gizon.
00:15 Well, there are many opportunities for franchising that can become your big business move in 2024.
00:22 Let's now have an exchange with Philippine Franchising Association founding member, Buts Bartolome.
00:28 Buts, great to see you.
00:30 Great to see you.
00:31 Happy New Year.
00:32 You know, a lot of our Kababayans who are watching us right now want to be entrepreneurs.
00:35 They just don't want to be employees, salaried people.
00:38 They always want that extra cash for the challenges moving forward.
00:44 How do you help interested franchises choose the right franchise?
00:48 A lot of people are asking that question.
00:51 They are always asking how to get a franchise.
00:54 Because there are so many from A to Z, from birth to death.
00:58 It's like we're saying something and they're confused.
01:01 So what I always tell them, look, what is it that you like doing?
01:04 What is your priority? What are your goals?
01:06 Priorities, what is your, are you committed?
01:08 Yes.
01:09 Because if you're not committed, don't invest anymore.
01:11 And then the third is actually, will you really enjoy giving employment to others?
01:16 But when you say committed, can't you be an employee and then your sibling,
01:20 your wife or your cousin will run the business, the franchise?
01:25 It depends. It depends. It depends on what they're talking about.
01:27 Because franchises will say, "Okay, you'll be committed but you're employed.
01:31 Who will be your substitute or alternate?"
01:34 So you have to discuss with your brother, your sister-in-law, whatever.
01:38 Are you really interested? Maybe we're just humans.
01:43 Because what franchises want really is somebody who will really bring the brand.
01:47 Yes.
01:48 Who will really expand and be a representative in the community.
01:51 So it's not just the franchisor, it's not relying on you for one franchise
01:56 but they want you to expand your business and have several franchises of that same brand.
02:01 Yeah, they want you to be a multiple franchise, which is the goal of every franchisor.
02:05 But we know, of course, that the most popular franchise is food, food, food.
02:09 Is that still the most popular franchise right now?
02:12 Filipinos like to eat, right? Seven times a day.
02:15 Yes, like Enzo is here to give us some advice on how to stay fit.
02:21 Yes, that's right. To be healthy, especially.
02:24 Because a lot of people would say, "I want to have a business."
02:27 What kind of business do you want? Food. What kind?
02:30 Especially now, 2024, there are a lot of culinary foods.
02:36 Young kids, culinary chefs.
02:40 Yes, there are a lot of Gen Z businesses now.
02:42 But of course, you say that franchises are from A to Z, but of course, food is at the top of the totem pole.
02:48 What would be the second, third, and fourth more profitable franchises apart from food?
02:54 The next is actually health. Enzo is right.
02:57 Health is wealth.
02:59 Health is wealth. What is an entrepreneur if you're always sickly?
03:02 You cannot manage a ship. You're the captain of the ship.
03:05 So everybody is now concentrating, "Okay, I want to have good food, but I want to stay healthy."
03:10 What is it?
03:12 That's why a lot of people are looking for personal coaches.
03:14 A lot of businesses are now building health-related ones.
03:20 But what is your advice for franchises?
03:23 We talked to Antonette. We should have an emergency fund of three to six months, but she has up to a year.
03:29 Can we use that emergency fund for franchises?
03:32 Actually, that's what we're advising.
03:34 If you have extra funds that you're willing to lose.
03:38 Because investment is a risk.
03:40 The bank will not even tell you, "Guaranteed."
03:44 So invest on something that you have done your research.
03:50 And you believe in it. You're passionate about it.
03:53 You've gone to the store. You've visited. You've talked to the franchisor.
03:57 You've asked your friends. At the end of the day, it's not popularity.
04:01 It's at the end of the day, will you be able to plug in yourself?
04:05 Let's say you want to set aside that emergency fund.
04:08 Can you go to the bank and say, "I want to get this franchise. I want to set up a business."
04:14 Do you ask the bank to lend you money?
04:16 No, it doesn't depend.
04:18 Because most banks will always want to know who the franchises you're going to get are.
04:23 And then also, they have the interest.
04:25 That's why most of the franchises that we get, we say, "Aside from the bank, do you have an extra savings that you can work on?"
04:34 Can you borrow some money at a softer interest?
04:38 Because if you borrow from the bank, it will be a running target.
04:42 That's right. And the interest rate is also high.
04:44 Alright. Okay. You have this really nice business, but how important is the location for your franchise?
04:51 Oh, that.
04:52 You know, with the pandemic now, there's a shift. It's different.
04:56 Before, it was location, location, location.
04:58 Now, it's actually online.
05:02 And then also, the location where you're in, will the market be sustainable?
05:08 Because you have a store.
05:10 But if the market is really hard up, what will you do?
05:14 You need social media presence.
05:16 Yeah, that's something. Social media is now the in thing.
05:20 That's right. So, if food is at the top of your list for starting a franchise, what would be a minimum investment?
05:29 Let's say for a kiosk.
05:31 Minimum investment would be running total of 500,000.
05:35 Wow. That's also big. 500,000.
05:37 All in. All in.
05:39 Not even 50,000?
05:40 Oh, no. Exactly. Sorry, but those are scams.
05:44 Because there are a lot of scams.
05:46 This is something that I feel so bad because there are a lot of people who are being scammed.
05:51 OFW, retirees, teachers.
05:54 It's like we're saying, "Don't be fooled. They worked hard for the money."
05:58 50,000 buy one, take one.
06:00 So, 500,000, where will that get you?
06:03 Well, it will give you a kiosk, but not in the mall.
06:07 The mall is kind of expensive.
06:11 So, what we're saying is like a community. You have a community area, community neighborhood area.
06:17 You can sell near the schools. You can sell by food trucks.
06:23 Food trucks are actually coming into play now.
06:26 But if they say, "I don't want a franchise. I want to create my own brand."
06:31 Boots, Bartolomé's, food stall. Is that much better than setting up your own franchise?
06:38 In the end, if you're really solid on your business concept, think about it.
06:43 How strong is your business concept?
06:45 What is your USP, unique selling proposition?
06:48 What makes it different?
06:49 And then how much can you support the franchises to be or multiple stores that you will have?
06:55 You cannot be a centralized person.
06:57 You have to have a core team to help you.
07:00 Alright, 500,000 pesos in San Sinabino to start a food stall, a kiosk.
07:05 Not inside the mall, but maybe in schools.
07:08 But when will there be a return on investment?
07:13 That's what we're looking for.
07:15 ROI.
07:16 You're already full, but the ROI is next.
07:19 Now, usually, what we're always saying in franchising, it takes about, again, two years.
07:26 Maximum of three years.
07:27 But again, never within a month.
07:30 Because it's impossible to spend 500,000 and return in one month.
07:35 So usually, we always tell, at the most earliest, about one year.
07:39 One year.
07:40 Because that's really reality.
07:42 So that's the way it is.
07:43 Alright, thank you so much, Butts, for this franchising exchange.
07:48 Butts Bartolome, founding member of the Philippine Franchising Association.
07:54 And before we go here, words from the greatest basketball player of all time, Michael Jordan.
07:59 If you run into a wall, don't turn around and give up.
08:04 Figure out how to climb it.
08:06 Go through it.
08:07 Or work around it.
08:10 And this is the exchange to make sense of the facts and the figures,
08:13 and the ups and downs of the business cycle.
08:15 Because your business is our business.
08:18 I'm Rico Gizon.
08:19 Thanks for watching CNN Philippines.
08:21 News you can use.
08:22 News you can trust.
08:24 [Music]
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