Franchising: Concrete Step toward diversifying the economy

By Khaled Amin Youssef

Franchising is the most important source of diversification of the economy’s sources. Therefore, all countries of the world are interested in it; Due to its enormous economic advantages that contribute to the development of the economy, increase income, create more job opportunities, attract hard currencies, and others.

This explains the great attention paid by Saudi Vision 2030 to commercial excellence, and to providing the appropriate environment for the growth and prosperity of brands; For its role in achieving economic diversification, and diversifying the sources of GDP.

Not to mention the ability of the commercial franchise to attract foreign investments and pump them into brands, and open branches in the Kingdom; This provides thousands of job opportunities for young people.

The government of the Custodian of the Two Holy Mosques has taken care of commercial franchising, through the General Authority for Small and Medium Enterprises (Monsha’at).

The Saudi government’s interest in commercial concessions came due to the high success rate it provides to the projects based on it, which contributes to the advancement of the small and medium enterprises sector, and achieves one of the most important goals of Vision 2030 in increasing the participation of this sector in the GDP to 35%.

Therefore, the Saudi government worked to encourage entrepreneurs to establish new brands with international standards, to help entrepreneurs develop and develop their existing brands, and to encourage them to experience commercial excellence.

The franchise has witnessed a great development by entering into various fields; The most important of them are food and beverages; Such as juices, water, carbonated water, energy drinks, the restaurants and cafes sector, the retail sector, fashion and clothing, cosmetics, leather industries, furniture manufacture and trade, and electrical and electronic appliances industry and sale.

The development has also reached the communications and information technology sectors, the logistics and transportation services sector, the services sector, such as maintenance and cleaning services, the education sector, the health sector, the travel, tourism, hotel, and hospitality sector, and the sports sector, especially in the field of tools, devices, and sports clothing, and the opening of branches for sports centers.

As well as the income of the commercial franchise in the real estate sector and real estate marketing, and the manufacture and sale of everything related to it such as paints and others.

The franchise sector was not limited to small and medium enterprises only but also extended to large industries, such as petroleum and energy, metallurgical industries, the automobile industry, the pharmaceutical industry, and others.

What makes the franchise business, the best and most capable model for growth and expansion is its ability to expand horizontally and vertically, overcoming all barriers.

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