Choose Your South East Asia Franchise Hotspot

Choose Your South East Asia Franchise Hotspot

The July 2018 Philippines Franchise Association conference and expo had thousands of attendees and over 30 speakers from around the world extolling the benefits of franchising.

There are an estimated 200 million middle class consumers in South East Asia. The Gross Domestic Product (GDP) growth for these countries average almost 6%. Franchising is often a preferred new business development model.

Food and beverage (F&B) franchises continue to be the leading franchise type in South East Asia, but education, retail, and service sector brands are becoming increasingly desired. For example, Asian families spend an unusually high percentage of their income on the education of their children to give them an edge when growing up. For this reason, U.S. education franchises like Abrakadoodle® are highly sought-after across the region.

Indonesia 

The world’s fourth most populous nation is experiencing a rapid expansion in the middle class, which includes over 30 million households. Most international franchises are in the food and beverage sector. While it is still early days for service franchises, the Mosquito Squad® country licensee recently had their grand opening in Jakarta.

U.S. F&B brands are growing in Indonesia, such as KFC Pizza Hut Dunkin’ Donuts, McDonald’s, Carl’s Jr.®, Caribou Coffee, Starbucks, WingStop, Jamba Juice and Coffee Bean and Tea Leaf. 

Indonesia data

Country Population:  260,580,000
Median Age:  30.2
GDP per capita:  US$12,400 (2017)
Projected 2018 GDP Growth:  5.3%


Malaysia

With the recent change of government, “Malaysian consumers have rarely been more optimistic. They were pleased with the change of government in May and are more confident about the future…. it is the fundamentals of Malaysia’s economy that have enabled consumers to translate the feelgood factor into higher spending. FT Confidential Research, July 31, 2018

Approximately 40 percent of the franchise concepts operating in Malaysia are foreign owned.  Malaysian entrepreneurs and investors are increasingly savvy on franchise concepts. Although the Malaysian government encourages promotion of franchising as a means to improve the number of new businesses and jobs, they have a policy called Bumiputra that favors locally started brands.


Malaysia data

Country Population:  31,382,000
Median Age:  28.5
GDP per capita:  US$28,900 (2017)
Projected 2018 GDP Growth:  5.7%


The Philippines 

More than 90% of all foreign franchises are U.S brands. U.S. players in the food franchise market include McDonald’s, Burger King, Wendy’s, Johnny Rockets, Pizza Hut, Dominos, Papa John’s, Dunkin’ Donuts, Krispy Kreme, Buffalo Wild Wings, Wingstop, KFC, Starbucks, Seattle’s Best, Coffee Bean and Tea Leaf, Dairy Queen, Baskin Robbins, Mrs. Fields Cookies, Texas Roadhouse and Denny’s. In the Philippines, the Bistro Group, which owns the country rights to TGI Fridays, Buffalo Wild Wings, and Texas Roadhouse. This group has also opened six Denny’s restaurants in two years. The country’s largest casual dining chain operator is Max’s Group Inc. who is the country licensee for Krispy Kreme and Jamba Juice and operates 12 different F&B franchise brands.


The Philippines data

Country Population:  104,256,000
Median Age:  23.5
GDP per capita:  US$8,200 (2017)
Projected 2018 GDP Growth:  6.6%


Singapore 

According to the U.S. Commercial Service, Singapore is home to a wide variety of franchise concepts. Unlike some South east Asian countries, service and retail franchises are well developed in Singapore. McDonald’s, Burger King, KFC, Wing Zone, Krispy Kreme, Subway, Starbucks, Ben and Jerry’s, Gymboree, New Horizons, Mister Minit, Avis, Toys R Us, Comfort Keepers, Abrakadoodle, and many others have operations in Singapore. 

Singapore is seen as a showcase for franchises in the region. Investors from nearby countries come to Singapore to see how a local, regional or international franchise works and then want to bring it to their country. Singapore also has the strongest intellectual property and corporate business laws in the region which often makes it the first stop for international brands seeking to enter this region. But, competition is very high in Singapore, as are the retail rents.


Singapore data

Country Population:  104,256,000
Median Age:  23.5
GDP per capita:  US$8,200 (2017)
Projected 2018 GDP Growth:  3.2%


Thailand

There are over 550 franchise brands operating in Thailand. Food restaurants, quick service and casual dining have the largest market share of about 24 percent, while ice cream and beverage (including coffee shops) are second with about 22 percent. International franchise systems control 60 percent of the total market value of the F&B sector.  A key regional Thailand-based player is the Minor Group which controls several major brands including Dairy Queen which has almost 400 treat outlets in the country. Minor is also the Thailand licensee for such international brands as Benihana, Swensons, Burger King and Sizzler.


Thailand data

Country Population:  104,256,000
Median Age:  23.5
GDP per capita:  US$8,200 (2017)
Projected 2018 GDP Growth: 4.1%


Vietnam 

Most franchised businesses in Vietnam are in the F&B sector with the major international burger, chicken and pizza brands being present. Vietnam is another Asian growth market for franchising, especially in the coffee sector. The Coffee Bean & Tea Leaf is well established, and PJ’s Coffee of New Orleans recently opened its first coffee shop in Ho Chi Minh City (Saigon). Vietnam is in the process of easing its franchise laws and regulations to encourage more franchise business growth. More franchises equal more jobs and this is a focus of the Vietnam government.

Vietnam data

Country Population:  96,100,000
Median Age:  30.5
GDP per capita:  US$6,900 (2017)
Projected 2018 GDP Growth: 6.9%


Other South East Asia countries seeing new international franchise business growth include Cambodia, Laos and Myanmar. These markets are in the early stages of franchise development with most brands being in the F&B sector such as Carl’s Jr in Cambodia and KFC in Myanmar.

ABOUT THE AUTHOR

William Edwards is CEO of Edwards Global Services (EGS). This article was created by EGS’s U.S.-based team, who collectively have 150 years of international franchise experience. Contact him at bedwards@edwardsglobal.com or 949-224-3896. Statistical data for this report is from ‘The Economist’ magazine and the CIA World Factbook.

Global Franchise Meets.

An inspirational new web video series where we meet the business leaders and influencers in International Franchising.

you may be interested in

franchise directory

  • TaxAssist Accountants

    Business & Professional Services, Financial Services, <100K, Featured

  • Cafe2U

    Food & Catering, Coffee, Take-away, <100K, Featured

  • 800 Pizza

    Food & Catering, Fastfood, Pizza, Take-away, Featured

view more
Connect with Linkedin Logo
Global White Logo Click Here
Close button

WHAT DO WE USE YOUR INFORMATION FOR?

Any of the information we collect from you may be used in one of the following ways: To personalize your experience (your information helps us to better respond to your individual needs) To improve our website (we continually strive to improve our website offerings based on the information and feedback we receive from you) To improve customer service (your information helps us to more effectively respond to your customer service requests and support needs) To process transactions your information, whether public or private, will not be sold, exchanged, transferred, or given to any other company for any reason whatsoever, without your consent, other than for the express purpose of delivering the purchased product or service requested. To administer a contest, promotion, survey or other site feature To send periodic emails The email address you provide for order processing, will only be used to send you information and updates pertaining to your order. Note: If at any time you would like to unsubscribe from receiving future emails, we include detailed unsubscribe instructions at the bottom of each email.

HOW DO WE PROTECT YOUR INFORMATION?

We implement a variety of security measures to maintain the safety of your personal information when you place an order or enter, submit, or access your personal information We offer the use of a secure server. All supplied sensitive/credit information is transmitted via Secure Socket Layer (SSL) technology and then encrypted into our Payment gateway providers database only to be accessible by those authorized with special access rights to such systems, and are required to keep the information confidential. After a transaction, your private information (credit cards, social security numbers, financials, etc.) will not be stored on our servers.

DO WE USE COOKIES?

Yes (Cookies are small files that a site or its service provider transfers to your computers hard drive through your Web browser (if you allow) that enables the sites or service providers systems to recognize your browser and capture and remember certain information. We use cookies to help us remember and process the items in your shopping cart, understand and save your preferences for future visits, keep track of advertisements and compile aggregate data about site traffic and site interaction so that we can offer better site experiences and tools in the future. We may contract with third-party service providers to assist us in better understanding our site visitors. These service providers are not permitted to use the information collected on our behalf except to help us conduct and improve our business.

DO WE DISCLOSE ANY INFORMATION TO OUTSIDE PARTIES?

We do not sell, trade, or otherwise transfer to outside parties your personally identifiable information. This does not include trusted third parties who assist us in operating our website, conducting our business, or servicing you, so long as those parties agree to keep this information confidential. We may also release your information when we believe release is appropriate to comply with the law, enforce our site policies, or protect ours or others rights, property, or safety. However, non-personally identifiable visitor information may be provided to other parties for marketing, advertising, or other uses.

THIRD PARTY LINKS

Occasionally, at our discretion, we may include or offer third party products or services on our website. These third party sites have separate and independent privacy policies. We therefore have no responsibility or liability for the content and activities of these linked sites. Nonetheless, we seek to protect the integrity of our site and welcome any feedback about these sites.

CHILDRENS ONLINE PRIVACY PROTECTION ACT COMPLIANCE

We are in compliance with the requirements of COPPA (Childrens Online Privacy Protection Act), we do not collect any information from anyone under 13 years of age. Our website, products and services are all directed to people who are at least 13 years old or older.

ONLINE PRIVACY POLICY ONLY

This online privacy policy applies only to information collected through our website and not to information collected offline.

TERMS AND CONDITIONS

Please also visit our Terms and Conditions section establishing the use, disclaimers, and limitations of liability governing the use of our website at globalfranchisemagazine.com/terms-conditions

YOUR CONSENT

By using our site, you consent to our online privacy policy.

CHANGES TO OUR PRIVACY POLICY

If we decide to change our privacy policy, we will post those changes on this page

CONTACTING US

If there are any questions regarding this privacy policy you may contact us using the information below. All correspondence relating to the Website should be sent to: Global Franchise 21/23 Phoenix Court Hawkins Road Colchester Essex CO2 8JY Email: subscriptions@aceville.co.uk