MANILA, Philippines - Enterprises today have far better chances than ever before of expanding nationwide through franchising. This is particularly true of businesses backed up by reliable systems and which have identified strong opportunities for growth, according to leading franchise consultant Rudolf Kotik.
The founder of RK Franchise Consultancy, which has assisted 450 firms to become sustainable franchises, reports that almost every key city in the Philippines today hosts enterprises governed by this business arrangement to distribute products or services based on a special licensing agreement.
Businesses that require average skills levels and have long-term potential markets are particularly attractive to entrepreneurs seeking to profit from tested business models. Kotik cites Suds Laundry and Dry Cleaning Service as the kind of enterprise sought out by franchise holders. Not only does Suds provide training in laundry operations, the business also comes with a digital program that allows its operator to constantly measure its performance and benchmark against those of the franchisor.
Established in Dasmarinas, Cavite in 2003, Suds set up franchises in Metro Manila on its seventh year and expanded to 23 stores over the next five years including Lipa City. It is opening its first store in Cebu City in November owned by Wash Your Troubles Away Inc. (WYTA), the province’s area franchise holder. WYTA director Eric Miranda is confident that the laundry service, which he describes as “the Starbucks of laundries” will click in Cebu which is currently dominated by mom-and-pop laundry shops.
Miranda relates that Cebuanos including the many young mid-income professionals working in the metropolis’ booming BPO and tourism industries no longer have time for laundry or the space for it. High-rise residential communities which target these upwardly mobile professionals and set up by SM Development Corp., the Filinvest Group and Megaworld all indicate a trend towards living in condominium units that have little space for laundry.
In the past few years, the growing demand in Cebu for shops that take in laundry have mostly been met by small entrepreneurs and ‘labanderas’ with “hit-or-miss chemistry resulting in damaged clothes,” according to Miranda. Clients are also subject to losing clothes they’ve sent to these shops that don’t have a computerized program and other systems to track received items.
Caloy Ang, founder and managing director of Suds, relates that he and wife and co-founder Charmaine themselves experienced the pitfalls of starting a laundry service more than a decade ago. Thus, the former reliability engineer of Intel set up training modules to ensure on time delivery per specs, accounting for each item of clothing received at every stage of the process. In addition, they offered to pick up clothes from clients and set up a computer program to track customer transactions and preferences and to reward loyal ones with discounts.
In recent years, Suds further improved the customer experience by air-conditioning its shops and designing them to achieve high visual impact from the street. Using design, color and lighting to woo customers, it has succeeded in achieving an average 98 percent rate of walk-ins. People always appreciate being in pleasant, high-energy surroundings, according to Ang.
Miranda relates that WYTA intends to set up a minimum of seven stores in Cebu in two to three years beginning with a shop in the highly-populated Guadalupe district. He admits that he and his partners, some of whom already own food and convenience store franchises, canvassed a number of business models before settling on Suds.
The brand’s expansion in 11 years to 23 stores – which except for two are owned by franchisees – have more than convinced them of Suds ability to grow with the robust economy of Cebu and its populace known for its keen ability to spot great values.