Franchising and marketing guru Samie Lim has urged government to require banks to dedicate a portion of the 10 percent mandatory allocation from their total loan portfolio for small and medium enterprises to franchise financing stressing that franchising is a better solution to help the country get out of the global crisis quicker than the rest.

Lim told Business Bulletin that the government does not really have to come up with the stimulus package just the wise implementation of present laws.

Lim pointed out that the Magna Carta for MSMEs (micro, small and medium enterprises) provides that banks should allocate 2% and 8% of its loan portfolio to micro and small and medium enterprises respectively.

“If I may put forward a proposition, I would like to see banks allot part of this 10% portfolio for a window dedicated to franchise financing. This can help the Philippines get out of the woods quicker than the rest,” Lim said.

Lim has also addressed the concerns of banks’ hesitance to let go of their cash to SMEs.

“Let me say, however, that franchising is worth investing,” he assured the banks. Lim is chairman emeritus of the Philippine Franchise Association, former president of the Philippine Retailers Association and president of Automatic Center , the country's biggest chain of one-stop shop home appliance store.

Lim, who represented ASEAN at the recent World Franchising Conference in Paris along with franchising gurus from North America, Europe, Middle East and Latin America, noted that despite the limited support from government and the financing sectors, franchising has already helped create thousands of businesses and millions of jobs in the Philippines.

According to Lim, in the ASEAN region, the Philippines leads in the number of franchise concepts and outlets.

“We have what it takes to bring the country to unprecedented growth. All we need is a little push,” he added.

There are about 1,000 franchise concepts creating about 100,000 outlets and generating about 1,000,000 jobs in the country today – and there is still much room for us to grow.

“Imagine what it can do if it is given the environment where it can reach its full potentials,” he said.

“This is where the government can really help. If the government is encouraging entrepreneurship to fight the crisis, it should put its money where its mouth is.” he said.

Franchising, as a business model, fits the qualifications of the affected workers noting that in these times of downsizing and layoffs, many people with management experience are looking for new careers.

“These affected workers are the perfect candidates for franchisees that can make a franchise grow,” Lim stressed.

Using the time, resources and network of the franchisee, the franchisor can expand his business. The franchisee, in turn, is given a livelihood. This win-win situation is a kind of entrepreneurship that government should encourage in this time of crisis.

Franchising is the better business model because it does not require someone to be an entrepreneur in the first place.

“Being a franchisee is not strictly being an entrepreneur. It is more of being a manager, which is what he was before getting retrenched. But this time, he is his own boss. It’s basically being an entrepreneur without the major headaches,” he explained.

He said that Philippines can become the franchise hub in Asia given the right government intervention because of its strategically located as the gateway to Asia and the Filipinos natural flair for the service industry.