KUSKOP ENHANCES FRANCHISE ECOSYSTEM, ENSURING FAIR MARKET FOR LOCAL AND FOREIGN PLAYERS

KUALA LUMPUR, Dec 3 (Bernama) -- The Ministry of Entrepreneur and Cooperative Development (KUSKOP) is committed to ensuring a balanced national franchise ecosystem, ensuring that both local players and international brands thrive through the National Franchise Policy 2030 (DFN 2030), while also providing financing and training opportunities for local entrepreneurs.

Deputy Minister Datuk Seri R. Ramanan said that, to date, 68 foreign food and beverage franchises had been registered under the Malaysia Franchise Express (MyFaX 2.0) system, while local franchises continued to dominate the market with a 52.1 percent share.

He said that the presence of foreign franchises brought several benefits to the local market, including attracting greater investment, strengthening the supply chain, and facilitating knowledge exchange as well as knowledge and technology transfer to domestic entrepreneurs and industry players.

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“KUSKOP believes that foreign franchises’ participation in the local market will bring multiple benefits, including boosting the domestic economy through increased investment and supply chain activities, expanding opportunities for local people, and enabling knowledge and technology transfer to local entrepreneurs and industry players,” he said during a question and answer session at the Dewan Negara today.

He said this in response to a question from Senator Rita Sarimah Anak Patrick Insol on the ministry’s assessment of the economic and social impact prior to approving new foreign franchises, especially in the snack and fast food sectors that already have many local alternatives.

Ramanan said that the government had introduced various financing schemes to support local franchises, including the Franchisor Financing Scheme, which had benefited 122 companies with nearly RM40 million in financing, while 945 companies under the Franchisee Financing Scheme had received almost RM216 million.

He said KUSKOP had also provided assistance programmes for veteran and retired entrepreneurs to acquire business equipment, as well as offering free or subsidised training and business development consultation services.

Ramanan said that the local franchise ecosystem had also been strengthened through training and financing provided by agencies such as Perbadanan Nasional Bhd (Pernas), to ensure a more balanced competition between local and international brands.

Responding to concerns about the impact of large retail chains such as FamilyMart on small traders, he stressed that franchises were also locally owned and did not disrupt market balance.

“It is not an issue if we look at the existing franchisors. Foreign franchisors make up only 47.9 pe rcent of the market, while local franchisors account for 52.1 per cent. We are still providing space and opportunities for local companies,” he said.

According to Ramanan, homegrown brands in the food and beverage sector, including Sangkaya, Kenny Rogers, Marrybrown and PappaRich, had been actively promoted overseas through trade missions to key markets such as Dubai, Osaka and Shanghai.

-- BERNAMA