Market Intelligence
Franchising Food and Beverage Retail Trade Philippines Trade Development

Philippines Franchise Concepts

According to the Philippine Franchise Association, franchising remains one of the drivers of growth in the Philippines. This presents a strong opportunity for U.S. franchisors as industry growth is driven by high consumer spending, brand consciousness, and a growing middle class that is ideal for scalable franchise business models. Last year, the industry contributed approximately 7.2% to the country’s GDP, as both local and international brands continued to view the Philippines as a prime destination for franchise concepts.

Food, retail, education, home and lifestyle, health, and wellness are popular franchise concepts, with food franchises remaining the most significant segment. U.S. brands such as Morton’s Steakhouse, Smith & Wollensky, and Duck Donuts have recently entered the Philippines’ market, signaling robust demand for American food concepts.

Service franchises are also on the rise, addressing evolving consumer needs in areas like education, health and wellness, automotive repair, and pet care.

Keys to Success for U.S. Franchises
 

  • Localization: U.S. Franchises will thrive in the Philippines if they can adapt to the local environment.
  • Marketing: It is essential to invest in marketing campaigns, such as utilizing social media platforms like Facebook, Instagram, and TikTok, as this attracts new customers and fosters word-of-mouth referrals.
  • Location: Position franchises in high-foot-traffic areas such as malls and central business districts (Makati, Bonifacio Global City, Ortigas). Filipinos love going to the mall, and central business districts also experience high foot traffic from professionals and residents.
  • Quality & Training: Maintain consistent standards with regular employee training to ensure that the service is world-class and that standard operating procedures are in place.

Executive Order 169 of 2022, or the Strengthening the Franchising Industry for the Protection of Mic, aims to strengthen the franchising industry by protecting both local and international franchisees and franchisors, outlining the minimum terms and conditions for all Franchise agreements in the Philippines. These include, but are not limited to, franchise disclosure requirements, franchise registration under the Philippine Securities and Exchange Commission (SEC), and minimum terms for franchisees to ensure fair practices and protection, especially for SMEs.

The U.S. Commercial Service can help you navigate the Philippine market and find the right partner. For more information, contact the U.S. Commercial Service in the Philippines: Katrina Domingo, Commercial Specialist at katrina.domingo@trade.gov.