“2020 will be the year of Franchise”

“2020 will be the year of Franchise”
15 January 2020

In Turkey, there are about 1000 initiatives that give franchisees in different sectors. Only 15% of these initiatives that render services with 25,000 branches survive after 5 years. Franchise sector is expected to be at a crossroads in 2020.

*** This release is originally published in Turkish.
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ISTANBUL (TR) - After 2019, when all brands have gone through a difficult bend, 2020 is expected to be a year in which only successful ones can survive in many sectors in parallel with economic developments. According to the assessment made by the Dealer Lease and franchise consulting company, it has close to 1,000 who venture franchise operation in Turkey. About 200 brands are known and appearing in this issue, while these initiatives operate with 25,000 branches. While 20% of these branches are renewed every year, only 15% survive at the end of 5 years. According to the study conducted on the low success rate, the inadequacy of the studies related to branding and the establishment of sustainable structures stands out as two main problems.

Brand loyalty should be created not only for consumers but also for employees.

Dealer founder Yahya Pulat, who evaluated the gap in the market and pointed out that the companies that come to the fore with their strong operational infrastructure, will achieve a significant growth in 2020 and said “Since different results cannot be obtained by trying the same methods, radical steps should be taken to change the spirit of the enterprises. After 2019, brand loyalty should be created in both the employee and the target audience with a presentation based on happiness. For real success, you should give up the office floors and artificial survey results and go down to the streets and improve your business by experiencing user experience.”

Turkish branded enterprises may be on the radar of foreign funds.

Stating that buying a franchise is perceived as acquiring something popular or buying a fashion rather than a commercial business model, Pulat said, “The issue should not be to open a large number of franchise stores. It must be cooperating with investors who will do their job right. To ensure sustainability by coding processes such as computer software that needs to be done in franchise systems. The brands that differentiate with their positioning and attach importance to communication and innovation are likely to blink to foreign funds. A brand owner should produce R & D and M & D products with the team in at least 5 developed countries, otherwise, the product cannot go beyond a random hunch. The number of brands that have managed to solve the bleeding wound of this sector to date does not exceed the fingers of a hand. I attribute this to the injustice in the distribution of income, to the owners of companies that cannot become professional. If your staff is not happy, your brand has no chance of being successful.”

“Franchise management is an area that requires expertise”

Stating that as a business model for franchisee management in Turkey late last couple of years, albeit step towards Yahya Pulat, "Franchising is a very important investment arm. It is very important that this is managed with a certain level of expertise. Dealer and offers support to those who want to be a pioneering step franchiser investors in Turkey. We have mediated more than 400 franchise transactions and our responsibility does not end with the realization of the franchise investment. We also monitor the profitability of the enterprise and the motivation of the operator to work. In the period of 2018-2019, we led our brands to give 65 new franchises and led them to grow by 22% compared to the previous year despite the economic difficulties. ”

“Everywhere is full of clone brands”

Pulat said that the failure to create an original brand brought the end of the businesses and said, “The franchise sector is very dynamic and changes in economic conditions and the re-establishment of the commercial equation make the brands predictive. See how many brands we have been franchising for 20 years? You don't think; because there is little. So how many foreign brands are there. We remember them all; Mc Donalds, Burger King, Starbucks, Nike If our perspective doesn't change, the franchise sector will be like this in our country in the future. Especially in such a period in the franchise sector cards will re-meet. New business models will emerge, new brand positioning ideas will develop. Brands should not think about today but 5 years later, otherwise, they cannot survive. They won't stay. Coffee, hamburger, meatballs, textiles, jewellery is full of clone brands everywhere. With these brands, temporary straw flames are formed, but not even our 10-year-old brands.”