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Business

Over 70% of franchise businesses hit hard by COVID-19, says PFA

Louella Desiderio - The Philippine Star

MANILA, Philippines — Over 70 percent of franchise businesses incurred losses and had to trim their workforce as they were hit hard by the pandemic, the Philippine Franchise Association (PFA) said.

During the second day of the 42nd National Conference of Employers organized by the Employers Confederation of the Philippines (ECOP) yesterday, PFA president Sherill Quintana said majority of those part of the franchise sector was greatly impacted by the pandemic.

She said 79 percent reported losses of over 75 percent due to the pandemic.

“Almost half of us, as much as 75 percent, had to reduce workforce,” she said.

She said the franchise sector was supported by the different programs implemented by the government in response to the pandemic.

Among the programs that helped support the franchise sector are the loans extended to employers through the Small Business Corp.’s COVID-19 Assistance to Restart Enterprises program, Department of Labor and Employment’s COVID-19 Adjustment Measures Program, as well as the mandatory grace period for loans with banks through the Bayanihan to Heal As One Act.

Still, Quintana said the franchise sector would want government support as challenges remain.

In particular, she said the franchise sector would want assistance in relation to tax assessments for the renewal of their business permits with local government units (LGUs).

“Many of us in the sector had to carry the burden of paying local taxes with a number of LGUs using 2019 as basis for tax assessments,” she said.

Quintana said the franchise businesses were barely surviving with 94 percent forced to close for several months last year.

“I hope we get relief programs, assistance also in terms of this,” she said.

Quintana said supporting micro, small and medium enterprises which are also part of the franchise sector, would help in economic recovery.

“Last year, while many have closed, we have seen new entrants having a roster of those people who were either retrenched from their work or wanted to become business owners or those who were able to realize they can make it work through franchising,” she said.

Quintana said the PFA is implementing programs to help those interested to get into franchising.

“We have programs to help raise public awareness in terms of choosing the right franchise as well, negotiating with government and helping also collaborate with other business organizations, big brothers here like PCCI (Philippine Chamber of Commerce and Industry), ECOP, Philexport (Philippine Exporters Confederation),” she said.

PHILIPPINE FRANCHISE ASSOCIATION
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