المنظمون السيد / رولف كيرست Mr. Rolf Gerhard Kirst

With reputation comes responsibility Benefits by Franchise in Saudi Arabia How to implement franchise know-how What needs to be done to development a franchise friendly environment for SME’s

Introduction Rolf Gerhard Kirst Personal introduction –Independent entrepreneur since 1977 –Experience in Cooperation since 1982 in the travel industry –Franchise experience since 1990 with travel agencies –Regional Master for Uniglobe Travel since 1994 –Board member of the DFV since 1999 –Board member and Vice President of the EFF since 2001 –Member of WFC

How to implement franchise know-how in a country 1.Prerequisites by the government for SME‘s and Franchise 2.Building an association versus private consultancy 3.PR and marketing to make Franchise attractive 4.Financing 5.Training (transfer franchise know-how to officials, franchisees, franchisers) 6.Consulting firms for developing local concepts 7.Recruitment agencies for franchise sales

Different understanding in the Middle East Taking an international franchise licence here means to get exclusivity rights Representing a brand and open a number of stores Sub-franchise is mostly unknown or rare

The big challenge Franchise in the Middle East is in the hand of a few rich families All outlets are managed by the main company Why not sub-franchise ?????

The enormous potential See demographics Middle East Below 10 yrs yrs yrs yrs yrs yrs. Over 60 yrs. Total Population 22,128,000 18,844,000 15,866,000 12,584,000 8,059,000 4,120,000 3,753,000 85,156,000 (%) By Age Group Middle East

Why sub-franchise Big families - but not every son can be fathers heir Young people need a vision and want to be self employed even if in smaller scale A big crowd of potential SME‘s The range for big companies is limited

Understanding... The benefits of sub-franchising To keep the business in local hands SME‘s positive influence to the economy To meet local employment obligations The big companies should reconsider their strategy

The situation today in KSA The Saudi government wants to establish Riyadh as the capital of franchise in the Middle East What needs to be done to development a franchise friendly environment for SME ’ s

The European model as a basis The Code of Ethics Self regulation by the market Unidroit - Model law versus self regulation The role of national associations and the EFF

Pre-requisits by the government for SME‘s and Franchise Low entry barriers for SME‘s Support with external know- how Fonds for financing Recognition by the government and the public

Building an association versus private consultancy First step by the Chamber of Commerce Second step by Private Consultants Third step building an association dominated by entrepreneurs

PR and Marketing to make Franchise attractive With support of the government the press will do his job An association or Chamber of Commerce will promote Franchise in general and impart franchise know how

Financing Bank loans Private investment Government fonds

Training Transfer franchise know-how to officials, franchisees, franchisors Seminars Exhibitions Info trips to other countries (Europe, USA) Special training courses –Business plan –Documentation etc.

Consulting firms for developing local concepts Local multi unit concepts want to expand with franchise –How to create the franchise model –Manuals –Training –Communication concept –Marketing and CI

Recruitment agencies for franchise sales Direct recruitment Recruitment agencies –Sales material –Marketing for franchise sales –Application process –Finding the right partners –Legal documents

The need of a Franchise Competence Center General Franchise consulting Franchise development Franchise recruitment Franchise financing Franchise marketing Franchise training

Conclusion There is a lot to do Tackle the challenge It‘s a long way to the capital of franchise

المنظمون السيد / رولف كيرست Mr. Rolf Gerhard Kirst