Bartolome is the Chairman of GMB Franchise Developers Inc., which has been
providing franchise consulting for over 25 years. He was chairman of the
Association of Filipino Franchisers Inc. (AFFI) in 2014. He shares his insights
about the Overseas Filipino Workers (OFW) as well as the common mistakes in
franchising and how to avoid them.
You were an OFW before you ventured into business. What should OFWs consider
before they invest their hard-earned money?
Two P’s: Plan and Prepare.
is crucial for an OFW to plan ahead of time. Normally, when you are
overseas, you get the false perception that your stay will last for more years
but the bitter reality is that your employment can end at any given time.
OFW’s have time during their weekly breaks and if they do these planning
activities, their time will be well spent rather than looking blankly at the
desert or going to malls and spending unnecessarily.
and look at what you can do when you go home “for good” to the
Philippines. Internet has sufficient materials to read and learn from.
There are plenty of business ideas you can look at. After the reading and
learning comes the planning on exactly what you intend to do.
business would you like or what franchise can you invest in. Plan to
email people that can give you more information or the franchisors that can
give you details of the franchise. Information on what business you want
to have on your return will give you goals on how you can prepare. What
funds you will need and the processes you have to undergo before you can become
I was working in the Middle East and Asia as Regional Operations Manager of
Shakeys International, I already planned to do business in franchising due
to my exposure. These were of course thoughts that I continued to
nurture through the years.
In your experience, what is the mindset of an OFW when it comes to employment
vs. entrepreneurship? What should it be?
The change in mindset of an OFW is the greatest challenge that has to be
faced. OFW’s for years have been so used to earning in US$ and regardless
of profitability of companies, an OFW still earns his salary.
is pole apart when you become an entrepreneur. As an entrepreneur,
you do not get your salary but you are fully dependent on the profits of the
business that you have. For an OFW to fully embrace entrepreneurship, one
should have the persistence and the commitment to give the business a go come
OFW should also have focus, a singular desire to make the business a success
and to give it all the tender loving care it needs. Failures and
challenges abound but successful entrepreneurs look at them only as learning
How do you convince someone to be an entrepreneur?
Be inspired by success stories of former OFW’s. Read experiences of
countless entrepreneurs who have made a mark or even just started their
Dagus was a
former OFW together with her husband Nick for 23 years in Sultanate of
Oman. They now have three branches of her “Dennis Coffee Garden” business all
in 2 years in Zamboanga.
are so many OFW’s that have planned and were prepared to go back home with a
singular intention of becoming an entrepreneur.
What was your inspiration to be a franchise consultant?
My exposure to international franchising has created in me this question, if
there are so many foreign franchisors expanding their business, why not the
saw the many benefits not only to the companies but the employment generated by
franchised businesses. Thus, on my return, I started talking to
businesspeople about franchising.
market I wanted to focus on were the small and medium size businesses that had
potentials to expand thru franchising. It was not easy to do this in
was then the monopoly of foreign franchisors or big and established companies
in the Philippines. Franchise investments that time were mostly in the
tune of millions and millions of pesos. My search was to have companies
offer franchise investment of less than one million.
was fortunate to have worked with companies with affordable franchise
investment like Julie’s Bakeshop, Potato Corner, Lots A Pizza, Fiorgelato Cafe,
Goto King, Figaro Coffee Company, Sacred Heart School, Binalot to name a
believe that franchising was a better option for entrepreneurship and the more
franchisees the better for the country and for the companies. At the end of the
day, I wanted a business, which will elevate lives of people and make the world
a better place.
What are the most common mistakes in launching a franchise? How can franchisers
The most common mistake is launching a franchise for the wrong reasons.
While it is true that a franchisor will franchise his business for profits,
this is not the end all reason for being. When franchisors launch their
franchise, it is important that they are committed to the success of the
franchisees first and foremost. Franchisors should learn from the exemplary
franchisor globally – Ray Kroc, founder of McDonalds, his basic principle in
franchising, focus on the success of the franchisees first and McDonalds as
franchisor will follow.
mistake of franchisors is inability to trust franchisees. There is a prevalent
perception that franchisees will invariably cheat or defraud them. This
mentality closes all doors to healthy communication lines with
franchisees. Inevitably, the franchise system deteriorates since
communication is the key element to the success of any and all franchise
are advised to reexamine reasons for franchising and be committed to the
success of franchisees. The golden rule again applies, do what you want
others to do to your business. Do you want your franchisees doing things
you do to them to your own business? Or very simply, when you harm your
franchisees, you are damaging your own business, remember, they are using your
What are the most common mistakes in choosing a franchisee? How can franchisers
1. Numbers game – Franchisors are eager to award as many franchisees as
possible. They want to collect as much franchise fees.
experience and from case studies of franchise systems, numbers game in
awarding franchisees is a surefire ticket to failure. Expansion thru the
franchise route has to be done slowly with full attention consideration every
step undertaken. Franchisors should realize using other people’s money is
a huge responsibility. Some franchisees invest their retirement pay
or savings from their overseas work into the franchise.
Owner or Owners have not time to talk with applicant – Franchisees are to
manage the branch similar to or if not exactly how the owners manage to ensure
success. If the Owners do not have a conversation with applicants, how
will they know if they have the attributes that will make their
business grow. Owners should also realize that these interviews open the
communication lines with their future franchisees. Communication is the key
element to the franchise system’s advancement.
Basic criteria for acceptance – availability of funds to invest
Franchisors are to have clear definition of the criteria for accepting
franchise applicants. It will not just be availability of
funds. We have seen many successful franchisees that had some difficulty
raising funds but had the commitment and perseverance for the
franchise. There is a clear difference between a franchisee that is awash with
funds and many other businesses and a franchisee whose financial well being
depend solely on the franchisee. The later spends days and nights
managing the branch. Which branch is more successful? Hands on
management of the franchisee are fundamental to financial viability.
Absence of a Discovery Day – A discovery day where applicants and
franchisor meet is step one in the application process. Both the
franchisor and applicant will have an opportunity to meet the each other
personally. Since franchising is a personal relationship more than a
contractual relationship, both parties can conclude if they can be partners for
5 years or for the term of the contract. We advise people that if in the
Discovery Day, one party feels he/she will be unable to work with the other,
then stop the process. This is indicative of certain realities that some
people cannot just work with each other.
Discovery Day is also an occasion where the franchise concept is fully
explained as well as what the franchise will entail. An in depth
information will enable the applicant to decide to continue or to stop.
Franchisors do not allow applicants to talk with current franchisees – It
is best that applicants talk to existing franchisees about their
experiences. The basic objection of franchisors is the fact that some
franchisees can discuss their negative experiences but we counter by saying, no
franchise system is perfect. There is will always be positive and
negative feedback. It is better for applicants to hear both sides so they
can make a decision considering all these feedback.
What are the most common mistakes in choosing a franchise? How can these be
avoided by franchisees?
Choosing a franchise because a friend has a franchise or they see a long queue
in the stores or I will just choose a food franchise as everybody
eats or this is a hot and cheap franchise.
are all the wrong reasons for choosing a franchise. When choosing a
franchise it is important to know what franchise you like and a franchise
that you can be proud of. One test will be this question, how will you
feel being in the store and serving or talking to customers? If your
answer will be yes, I will be happy doing that then go for it.
Sustainability of the franchise concept is an important consideration so the
concept should have endured the test of time.
will also ensures sustained operations of your franchise. This is not what hot
and cheap franchises have as usually they are fads that fade in a short time.
What are the most common mistakes in operating a franchise? How can both
franchisers and franchisees avoid these?
The belief that since it is a franchise, it can be successful on
autopilot. The barometer for the success of franchised branches is
the level of hands on management provided by franchisees. The branch will
always need the presence of an Owner regardless of years in the franchise
system. Customers are usually drawn to branches where there is an
Owner on the floor Implementing shortcuts to product or service
quality. I am sure you have experienced how product quality of
franchised branches is excellent at the initial stage of operations only
to deteriorate after 6 months or a year. This is particularly true
with foreign franchises in the country. The reason of course is to
lower food cost and this is the same reason for local franchise likewise but it
is a toss between better profits temporarily and losing customers in the long
inability to provide long term support and assistance to franchisees.
Part of the responsibility in the Franchise Agreement is assurance that he
will be the Big Brother to assist the franchisee in his operations until
the end of the term.
franchising, both franchisors and franchisees are to recognize that advancement
of the franchise system is a joint obligation. The beauty of
franchising is the fact that benefits are mutually shared and while actions are
done separately by both franchisor and franchisee, its effect is on both.
Giving these franchise principles importance enables the system to survive
for years and even for generations. Take a look at very mature franchise
systems that have lasted even for centuries.
Record-breaking, bestselling author Josiah Go is the Chairman of Mansmith and Fielders, Inc. (the leading marketing and sales training company in the Philippines), and Chairman of Waters Philippines (the market leader in the direct selling of premium home water purifiers in the Philippines). He is Chairman / Vice Chairman / Director of over a dozen companies.