Firms Warned Against Granting Franchises For Quick Profit

Trade Arabia:

A food industry expert has warned companies in the Middle east against falling into the trap of randomly granting franchises for quick profit.

Speaking at the International Conference and Expo for Franchise 2008, Rami Abu Ghazaleh, CEO of Albaik Food Systems, pointed out that several companies were making the mistake of franchising their brands for quick profit and strongly advised them to first set up an administrative mechanism consisting of specialized personnel to study franchise applications and supervise implementation.

An initiative to enhance new trade and economic opportunities in the Kingdom, the conference, organised by the Riyadh Chamber of Commerce, is part of its efforts to make Riyadh the centre of business franchising in the Kingdom.

‘We do not have to go back 50 years in order for the Arab Market to go through the same enhancement phases that the international markets did aiming to reach Franchise organizations, but instead we have to benefit from their experiences,’ said Rami.

He stressed on to the need for effective legislation to be put in place covering both the franchisor and the franchisee in order to protect the franchise’s reputation and maintain credibility as a brand.