In a very interesting piece published in The Star newspaper recently, the chairman of the Malaysian Franchise Association (MFA), Abdul Malik Abdullah, who is also the owner of D’Tandoor Food Industries Sdn Bhd, expressed that “the relationship between a franchisor and franchisee is just like a marriage, at the early stage it could all be rosy and beautiful.” With that analogy, he probably meant that it takes perseverance, love and dedication to see the relationship head towards success. That compromise is needed in a marriage is an understatement and likewise, compromise is also required between the franchisor and franchisee to make the franchised business work.
The franchise industry has been growing in Malaysia, with a lot of new foreign and local brands being introduced into the market. Statistics from MFA show that the number of franchisors has risen in a steady manner since the year 2000.
The types of businesses that are popular and frequently franchised in Malaysia are predictable. If you ventured a guess, you may have thought of all the Starbucks®, McDonalds® and KFCs® we see around us on a daily basis. Yes – the food and beverage industry is indeed the most popular business model to be franchised! This is followed by the clothing and accessories sector and thereafter by service, education, beauty and health, retail and finally, IT and communication.
According to MFA, there are 603 franchise brands and some 6,000 franchisees in Malaysia. However, Malik believes these figures are definitely bound to rise as there is a lot of room for growth in the industry, adding that “If we compare Malaysia and Singapore, the latter with a much smaller population has about 30,000 franchisees”. Malaysia, as mentioned above, has 6,000, which is a mere 20% of this number, thus giving our neighbours across the causeway certain bragging rights in this respect.
Of the 603 franchise brands that are in Malaysia, the top five are those that are known to all of us as they appear in many locations in the Klang Valley and in other states in Malaysia. Let’s have a look at the five best running franchise systems in Malaysia, as released by the MFA:
As KASS contributes to the Franchise Asia magazine and provides talks on franchising, we shall continue to keep you updated on the Malaysian franchise industry. In the meantime, should you wish to learn more on the franchise landscape in Malaysia, here are some relevant articles that were published in The Star in recent months; do have a look at what the Managing Director of Chaswood Resources Holdings Ltd, Andrew Reddy has to say about the minimum investment needed to run an F&B business and the sacrifice of your personal life that you may face as well…