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Fri 16 Jan 2009 04:00 AM

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License to thrill

Dubai's FranExcel has an exciting line-up planned for the world franchise forum, as MD Gareth Parry reveals.

Dubai's FranExcel has an exciting line-up planned for the world franchise forum, as MD Gareth Parry reveals.

How important is the World Franchise Forum to the Middle East's FMCG industry and Dubai as the host city?

The World Franchise Forum will bring together leading professionals from across the world, many for the first time to the region, which will put the region's retail and FMCG industries into the international spotlight.

The Middle East region is already a hotbed of franchise activity and we feel that there is still a very long way to go before any form of saturation takes place.

Dubai is the business gateway to the entire region and is home to many of the world's finest franchise brands and of course the pinnacle of the regional retail industry.

Who will you be working with to organise the event, and how will you contribute to the final show?

FranExcel is the organiser of the event and we are working with International Expo Consults, who are the organisers of the Franchising Middle East exhibition. Our role is to put the speaker faculty together, sell the delegate places and the general management of the event.

As an inaugural event, it has been hard work to get off the ground. Having said that, we have organised the seminar programme for the last two years at the exhibition, so this is a natural step up for us and we have really enjoyed organising it so far. FranExcel has many partners, associates and colleagues across the world, all of whom have helped us to put the event together.

Who do you expect to attract to the Forum, and why?

Franchise professionals from across the region and from major franchise markets will attend. Having the support of the International Franchise Association also helps us to spread the profile of the event globally and we are already attracting interest and initial registrations from all across the world.

We hope to have more than 200 attendees at the event. The Middle East is a booming franchise market, with recent annual growth in excess of 25% and many companies want to come here to review the franchise and retail landscape for themselves.

The Forum, together with the exhibition, provides an excellent platform for international visitors to meet and share ideas with their regional peers and to see for themselves the opportunities that the market has to offer.

What is the scheduled line-up for the event and how will it stand apart from similar existing events?

We are currently putting the speaker faculty together, which will be ready and launched within the next couple of weeks, but what we can say is that we have executives and franchise professionals from four continents presenting during the event. When we announce the line-up, it will be special.

One highlight will be the presence of the president and CEO of the International Franchise Association MatthewShay, who will deliver a keynote address on the state of the franchise industry in the current economic climate.

We also have workshops that will be interactive and give delegates tangible knowledge to take away, including how to franchise their own business and how to effectively acquire master franchise rights. The whole event is about best practice and how that then translates into success.

No other similar event has taken place in the region, except for seminars at smaller regional franchise shows. This is a unique event for the region.

Which examples would you give of franchising success stories in FMCG/ F&B in this region?

There are so many excellent success stories across the region, which have developed over the last twenty or thirty years. Franchising is one of the most globalised industries in the world, with many franchise companies entering new and emerging markets right at the beginning.

It started here with the car dealerships and hotels, then with food and retail and now we see franchises from the services sector, hospitality, training, education, healthcare and business services.

Companies that spring to mind include Al Sawani, Americana, Al Tayer, Bin Hendi, Al Hokhair, Azadea, Al Shaya, and so many more. These companies have taken the industry by the horns and spent the money and developed excellent infrastructures and processes and have seen their investments flourish and grow. If not for these companies, our shopping and dining experiences in the region would be very dull indeed.

Although so many franchise companies have chosen the larger operators in this region, we do still see smaller investors being able to secure franchise rights in this region.

We are also seeing a number of ‘home grown' indigenous brands developing their systems into a franchise model and then expanding regionally and internationally through franchising.

This is an area that we hope will grow and grow, and regional governments provide a lot help to entrepreneurs to enable them to start their own businesses and develop them.

How will the Mohammed Bin Rashid Establishment for Young Business Leaders contribute to the event?

MBRE focuses on SME development and franchising is an excellent model for the growth and development of small business. Their support has been gained through their association with the FME exhibition, of which they have been a part of for a long time.

Do you feel there is strong potential for franchisees in this region, and why?

The Middle East region is already a hotbed of franchise activity and we feel that there is still a very long way to go before any form of saturation takes place. The region is growing, in terms of population, visitors, business and infrastructure and the franchise market will reflect this growth.

The consumer is also becoming more demanding and smarter and they want good service, quality products, consistent delivery and lots of choice. This has been a problem in the past, but the opportunity lies in providing the consumer the best possible experience.

Franchising helps to deliver such consistency and quality, through regulated systems and control mechanisms that are at the heart of the model. People who experience a brand in one country simply want the same experience in other countries, including their own.

The development of sub-franchising is a major growth area. So many companies own the franchise rights through a master franchise agreement, but fail to sub-franchise those rights across their territory, opting to open their own stores or restaurants.

They are missing out on revenue and growth potential and ultimately, it means the small potential franchisee loses out. The bigger companies also command better rates and space in malls across the region and this also helps to shut out independents and also some of the smaller franchisees.

What they should be doing is leveraging their buying and negotiation power to help their own franchisees get the best locations and rates possible.

How important is franchising to the growth of the retail industry in the Middle East?

In terms of numbers, there are roughly around 1000 to 1500 franchise brands operating in the entire region.

Worldwide there are approximately 20,000 franchise brands, so yes there is a lot of growth potential in terms of choice, development and new entrants. Franchising has driven the retail industry here and in fact has outpaced the growth of the retail market, as there are more brands and companies looking for prime retail space than there is available space. This is particularly apparent in the GCC region.

This supply/demand problem has led to mall operators charging very high leasing rates and often totally unfavourable terms. This of course needs to be addressed and balanced out to help retailers achieve profitability.

I know many companies who are just not making any money, even those in what are termed ‘top' malls. The metrics simply don't add up for some companies.

The franchise industry is a major contributor to the GDP's of every regional country. It provides employment, retains wealth, creates opportunity and delivers choice and competition. The franchising sector is essential to the future growth, sustainability and quality of the retail industry in the Middle East.

Would you like franchise with that?

Dubai's FranExcel, the international franchise marketing, training and consultancy firm based in Dubai, is organising the inaugural World Franchise Forum 2009, set to take place in the city in March.

"We are so pleased to be working alongside International Expo-Consults, the organisers of the Franchising Middle East Exhibition (FME) in organising and running the World Franchise Forum, which will run concurrently with the growing exhibition, which is now into its 6th year. Dubai is one of the fastest growing and most dynamic cities in the world and where better to stage such a prestigious world-class conference, which will bring together some of the world's leading franchise exponents," said Gareth Parry, managing director, FranExcel.

The Dubai-headquartered global franchise marketing, consultancy and training company FranExcel offers combined industry knowledge of more than 50 years and branch offices, associates and partners in 30 countries, serving customers in more than 45 markets.

FranExcel also conducts franchise infrastructure programs for governments, assists with the drafting of franchise legislation, provides market-leading consultancy programmes and offers dedicated investment advisory services in the franchise sector.

The conference will take place from March 2 to 3 at the Dubai International Exhibition and Convention Centre and it is tipped to feature a world-class speaker faculty, as well as interactive sessions to cater for all levels of experience in the franchise industry.

The conference will fully complement the exhibition, which offers international franchisors the opportunity to showcase their franchise brands to an audience drawn from across the Middle East region.

With the franchise industry already growing at more than 20% per annum, the United Arab Emirates and the rest of the GCC region is a fertile market for franchise companies to expand into.

The Forum will highlight the current regional and global market landscape, as well as look at all the opportunities that lie ahead, while presenting the latest regulatory issues, legal frameworks, sales and marketing opportunities. It will  also give the audience the opportunity to gain direct insight from some of the world's most successful franchise companies.

During the current economic climate, franchising is seen as a lower-risk and longer-term investment vehicle and the Forum will also address the key operational issues and strategic planning needed to succeed in these uncertain times.

The event is being supported by the International Franchise Association (IFA) and is presented by the Mohammed Bin Rashid Establishment for Young Business Leaders, the SME development organisation in the UAE. The Call for Papers for the conference programme is currently under way and any interested companies or individuals who wish to speak at the event should contact FranExcel for more information.

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