THE franchising industry is expected to post more modest growth of about 8% this year, the Philippine Franchise Association (PFA) said.
“I think (growth will be) a bit more muted… at about 8-10%,” PFA Chairman Sam Christopher Lim said on the sidelines of the Franchise Asia Philippines 2025 Conference and Expo.
The association had projected 10-12% growth was for 2024.
“We do know there are a lot of headwinds around the world, and we do not know where inflation or interest rates are going,” he added.
He said US tariffs will have an effect on brands most exposed to the US market.
“But even that will be a bit muted because I think in the franchise sector, they’ve been diversifying their supply base, and a lot are actually localized,” he added.
In terms of value, PFA Director Joey Alvero said the industry’s value is “much bigger now” compared to the P538 billion estimated in 2022.
“I think if in the past years it has been growing by about 8-10%, (at a compounded rate) it is going to be about P800 billion,” he said.
Mr. Lim said that food remains the biggest segment for the franchising industry.
“But services is actually one of the faster-growing sectors. As the market matures, service franchising actually becomes an equally important sector. But food will still drive most of it,” Mr. Lim said.
He said that the growth will also be driven by the demand from more people getting into franchising.
“We see a lot of people really wanting to be their own boss. Especially people in the provinces — they want to be based back there and create their own opportunities there,” he added.
He also cited the Department of Trade and Industry’s support for the franchising industry through financing.
However, Mr. Lim said the industry needs policy support in the area of ease of doing business.
“If there’s something that will help the industry, it’s ease of doing business, cutting red tape, and really trying to standardize the rules across the local government units because sometimes they differ,” he added. — Justine Irish D. Tabile