Philippine Franchising

In 2022, the sector contributed 7.8% to the country’s GDP and generated roughly two million direct and indirect jobs.  Food and beverage franchises contributed 80% of this revenue, bringing in more than $10.8 billion.  Non-food retail and services each delivered 10% to the total, valued at $1.34 billion.  According to the Philippine Department of Trade and Industry, the Philippines is the 7th largest franchise market in the world and the largest market in the Southeast Asian region. Franchising is fueled by the growing Philippines middle class who have the propensity to spend and indulge on themselves, their family members and friends. 

The Philippines has a population of 110 million with a 96% literacy rate.  Many young professionals are tech savvy, own mobile phones and electronic gadgets, knowledgeable of brands, and are becoming more health conscious.  The Business Process Outsourcing industry has created job opportunities and increased the purchasing power for young people, indirectly creating demand for consumer goods, especially for food and services. 

The Philippines is also a pro-American brands market.  Filipino consumers have a strong awareness of U.S. brands and according to the Philippine Franchise Association, of members who carry foreign franchises, 60% represent U.S. brands.  Several popular U.S. brands can be found in major cities across the Philippines. Eating at a popular establishment or owning branded items signals societal status in one of Asia’s most social media savvy populations. 

 Although the food category continues to be a lucrative prospect, there is also an opportunity for foreign franchisors that serve the health and beauty sectors.  The Philippines is showing a huge market for beauty enthusiasts and the market is growing and expanding through generations.  We can see the current trend that more Filipinas are inclined towards beauty even at a young age nowadays.  They are conscious about their appearance, love taking care of their skin, and always want to look good and feel good about themselves.  There are a lot of Filipinos waiting every day for something new to solve their skin and beauty woes.  This is one of the reasons why locally, the skincare industry is emerging. 
 
The Philippine market has a big appetite both for food and non-food categories of the franchising sector. In fact, the Philippine Franchise Association is expecting The Golden Age of Franchising by 2025 that is why it will host the World Franchise Council Meeting and the Asia Pacific Franchise Confederation Meeting this 2023.  

 For more information contact Shelinda.Soliman@trade.gov