Franchising in the ASEAN Region

Post Pandemic 2022 sees an increase in discussions for Franchise expansion of brands between specific countries in the ASEAN region. F&B, Education, Health and Fitness brands continue to ploy ahead with regional expansion. Whilst less face to face meetings have taken place, a lot has been accomplished through a combination of virtual meetings as well as physical face to face meetings.

Emerging Markets of ASEAN regions

The ASEAN region is of increasingly significant interest to businesses and corporations, consisting of savvy consumers in markets because of the huge growth and financial rewards potential. For clarity, the ASEAN comprises of 10 member states; Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.

The region has emerged as a key business market on the global stage as a whole, but brand owners should be wary of the unique characteristics of carrying out business in each specific country. For instance, the 10 countries differ greatly in population size, income level, innovation capability, language and cultural attitudes. When expanding into or even across ASEAN countries, it is important to tailor market entry plans in accordance with each country’s respective laws and practices.

If you are a franchisor who has plans to either enter any of these countries wither through direct franchising or through Master franchising, it pays for you to do some preliminary market research to understand the legal franchise framework to avoid pitfalls that can cost you unnecessary loss of time, money, reputation or all of the above.

Law and Regulations

Most countries in ASEAN have not enacted Franchise-specific Acts, with franchising often regulated by each country’s respective Business/Finance Act or the Intellectual Property (IP) Code. This series of market research chapters seek to explore franchise-specific market entry insights for countries like Indonesia, Malaysia, Thailand, Vietnam and Singapore. For ASEAN countries with a specific Franchise Act, this summary research report will also highlight market overview and entry requirements, especially for pre-entry franchising requirements, franchise registration, industry specific regulations and taxation.

Whilst some countries in the region do not have specific Franchise Acts, there are laws that have direct or indirect regulatory impact on franchising, such as:

  • Foreign Trade Investment.
  • Anti-trust regulations.
  • General commercial and contract laws.
  • Consumer Protection, trade practices.
  • IP Laws.
  • Tax Laws.

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Despite the variance in market entry requirements across ASEAN countries, with proper planning, franchisors will be able to execute expansionary initiatives with proper planning that addresses the different legal environments and pitfalls before engaging in franchise partnerships in the region.

Astreem has compiled a comprehensive check list for franchisors seeking to enter new markets. For specific information on these markets, please enquire here.

You can now download the country specific research worth xxSGD to expand your business overseas for free(only for any one country).

Choose a country specific report to download:

Indonesia
Philippines
Malaysia