How has Covid-19 affected the franchise business in Southeast Asia?

Is there light in the darkness?
As I work self-quarantined at home in Vietnam, and review the latest news headlines of “California governor orders 40 million residents to stay home”, “Probably 12 months of hardship for all of us”, and “Vietnam’s capital advises people to stay home in coronavirus fight”, I wonder if our world will ever be the same.  My son has been home from school for nearly three months, my favorite restaurant is closed, and my dog can’t even go for a walk.  People all across Asia are facing similar circumstances so I am by no means unique.


But then I read an article courtesy of Dan Martin out of Beijing on Yahoo news – “As world cowers, China glimpses coronavirus aftermath.”  It had a picture of people with their kids in a park and described restaurants re-opening, factories starting to stir, and the famous morning exercising in the parks.  Of course they are all wearing face masks and taking slow cautious steps, but it is a good reminder that life finds a way to recover from even things such as CoV-19.

Sometimes it seems like we have been dealing with this forever, but according to the website the source most people are checking out every day for updates, China really started around Jan 22nd and peaked only one month later in mid-Feb.  Since then there have been very few new cases.  So, as it now ravages Europe and the Americas, there is some hope it won’t last long.

How has this affected the franchise business in Southeast Asia?  Many would say that life here in ASEAN has simply been on pause.  Like hitting that pause button on the television remote which just stops the movie in the middle.  In many cases it is true, but we need to remember that pause isn’t a stop or an end to the story, it is simply a short break to go grab a drink or to use the rest room.

Every day I talk with many people in the franchise industry, franchisors and franchisees, clients and potential new customers who realize that there is a difference between things that must unfortunately pause at the moment, and things that take time to mature and that don’t need to be on pause.

Let me explain.  I am in discussions with many potential groups for education franchises in Asia.  In a time when almost all schools are closed, including English language centers, we are moving forward in discussions with multiple groups and in multiple countries.  Why you might ask?

A typical new franchise takes about 3 to 6 months from initial discussions to being able to open a new restaurant, bakery, café, service, or as in these cases, English language schools.  August and September are traditionally the months that indicate the start of the new school year.  These companies will be in a position to maximize the pent up market demand in their area when things return to normal.  They will be ready to help kids in their market catch up on the education they have been denied in the past few months.

It is unfortunate that the situation has caused the permanent closures of many businesses that were just managing to survive.  But might that same situation leave the opportunity for new growth?  New locations available to rent, room for new brands in the market, or a new English language school franchise in the neighborhood.  Doesn’t really matter whether you’re looking for a coffee, bakery franchise, salon, milk tea, laundry, or fast food franchise, the fact is that new franchise opportunities will be available in the next couple months.

No matter where you live, we all have some short term tough times ahead.  I think it might be months before I ever shake someone’s hands again, my much hated face mask will continue to get a lot of use, and I will permanently pay a lot more attention to washing my hands and disinfecting my house.

But I will also continue to look beyond the short term, past the next few months and continue helping businesses find new franchise opportunities for future success.  Planning for the future sure beats sitting at home worrying about the present.

Just my thoughts

Robert Beausoleil has been visiting Asia for 25 years, and has lived in Vietnam for more than 12 years.  He works as the Director of Business Development and Franchise Operations for VF Franchise Consulting.  He has worked in franchising for more than 20 years, both for franchisors and master franchisees.

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