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Franchisors urged to adopt to new normal

By Anna Leah E. Gonzales

Franchisors are urged to redesign their business model to increase pick up and delivery services during this time of pandemic, a National Economic and Development Authority official (NEDA) said.

In her presentation at the Franchise Asia Philippines Virtual Conference 2020 opening ceremony on Monday, NEDA Undersecretary Rosemarie Edillon also urged franchisors to maintain safety and hygiene, and protect their franchise brand.

“You should also realign services with consumer demands and convenience. Be creative and enhance collaboration between franchisor and franchisee,” she said.

Edillon, citing information from Google Mobility Data Tracker, showed that while a slowdown in economic activity was observed, notable improvements in the movement of consumers was seen.

“Google Mobility Data Tracker tells us after we’ve eased some of the restrictions, how is now the mobility of our consumers, workforce. In terms of retail and recreation, we are seeing some of a recovery from -51 percent (as of August 17) to just -36 percent (in September 11).

She said that grocery and pharma is also recovering from a contraction of 24 percent to just -18 percent in September.

“With respect to parks, before we are seeing a -22 percent, now it’s just -6 percent, which means there are now a lot more people going to parks,” she said.

Edillon noted that threat of the coronavirus disease 2019 (Covid-19) will continue to be in the minds of individuals, consumers and businesses.

“This actually implies a number of challenges. There could be new opportunities and challenges as there will be shifting consumer preferences and there will also be shifts in production processes,” she said.

Edillon said they expect a higher demand for household products; health-boosting goods and services; soap and sanitizers; alcohol, face masks and face shields; internet; electronic gadgets; utilities; and bikes and motorbikes.

Lower demand, however, is seen for non-essentials such as tourism and travel.

Members of the Philippine Franchise Association (PFA), however, continue to be optimistic on the prospects of the franchising industry.

PFA Chairman Richard Sanz said that “the best way to tackle the Covid-19 crisis is to accept it and work with it.”

“As what we in PFA have always said, the world may have changed but opportunities still remain. It is up to us to look for these opportunities. Moreover, the franchising industry is on its way to better times; and this is not just wishful thinking,” said Sanz.

“According to EGS, a US-based franchising think tank, the Philippines still ranks among the best destinations for international franchises. We got an average of 2.1, with 1 as the highest, 2.5 as fair and 4 as the lowest. I say still because ever since we landed on their list, we have always been among those on top,” he added.

He noted that despite the pandemic, the PFA secretariat continues to receive inquiries from other countries on how to expand in the Philippines,

PFA President Sherill Quintana, meanwhile, is hoping the conference would help franchisors build the capacities of the sector to make them globally competitive and ready to face disruptions.

“The employment that we generate – both direct and indirect – is about 2 million. And if we talk about taxes, which is the language that the government hears, the sector’s direct and indirect taxes can go up to 8 percent of the total taxes collected by the government. At least, this is how it was before the Covid-19 crisis. But by changing mindset, this can also mean that this is the potential of the franchising sector if we are able to manage the difficulties of the said crisis,” said Quintana.

This is story is originally published by  the Manila Times, to view the original post please visit https://www.manilatimes.net/2020/09/22/business/business-top/franchisors-urged-to-adopt-to-new-normal/770565/