Declining failure rate underlines strength of franchise business

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The franchise business in Thailand is expected to grow by 17% this year to a value of 160 billion baht as more people look to earn more income by opening their own businesses.

The number of franchised outlets is likely to rise beyond 40,000 this year

Bangkok Post

and employment to exceed 200,000 jobs, said Peerapong Kitiveshpokawat, director of the International Retail and Franchise Business R&D Center at Sripatum University.

A survey by the centre in 2010 found a total of 514 franchise operators in the country, 480 of which were Thai businesses, running a total of 26,922 outlets. Around 40-45% of the operators were in the food and beverage industry and approximately half of the business value came from convenience stores.

The average time in existence for a franchiser was more than five years, which indicated the strength of operators in the industry, in line with the declining rate of failure which stood at 12%, down from 20% in the past.

Collections of franchise fees _ entrance and royalty fees _ were around 870 million baht in 2010 and were estimated to have exceeded one billion baht in 2011.

Mr Peerapong said the franchise business this year could receive a boost in the aftermath of the severe floods of late 2011. Businesses that may …

Full story from Bangkok Post at http://goo.gl/8dcOE