Three Trends to Grab India and ASEAN Franchise Market: Beauty, Education and Health
- Bulgoggi and Bibimbop are the Past Representative Image of Korea. Currently Korean Products Ranges from “Lipstick of Korean Celebrity” to “Learning Material” from Korea –
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The wind of change blows in franchise business focusing on food. Since 2000, about 100 Korean franchise businesses have gone abroad. Even though the share of food business is still high, many franchise companies including “K-Beauty” and “K-Fashion” are competitively going abroad on the back of Korean wave.
Korea’s unique education system based on ardor for studying is grabbing the attention. Korea’s education service company “Daekyo” explored its first overseas market in 1991 and currently runs 240 learning center in 16 countries including China, Hong Kong, Singapore and Canada. Etoos, which entered Indian market, is very popular as it opened the Korean style one-subject course.
Korea International Trade Association (president Duck soo Han) held “Seminar on the Strategy to Enter India-ASEAN Franchise Market” at COEX, Samsung-dong on May 27. At the seminar, experts on franchise business in Vietnam, Indonesia, Malaysia and India gave good information on local condition as a speaker.
In Malaysia, dining industry accounts for 35% of franchise market as of April, 2014 followed by service (12%) and fashion (11%). But it is expected that health supplements, fitness club (gym) and education will be promising. In case of Indonesia, Vietnam and India, it is expected that dining industry maintains its high share in the franchise business but industry related to quality of life including beauty shop, spa, cleaning, hygiene and children’s education will be more promising.
Anang Sukandar, Head of Indonesian Franchise Association, said “with the increase of income and living standard in emerging companies, the interest in quality of life and health will increase as well. Accordingly, industry related to beauty, education and healthy will be more important”.
Christian Granville, COO of Limchareon, law firm in charge of franchise industry consulting in Vietnam pointed out “middle class” and “glocalization” as key words for Korean company’s success in local markets.
Granville said “Consumption pattern of middle class in Vietnam is diversified, which is different from past pattern of focusing on low-priced Chinese products, and demand for high-end products is increasing”. He suggested Korean companies need to target middle class with its excellent service and quality. Another key word for success is “Glocalization”, which understands local culture and links the culture to one’s products. Lotteria which entered Vietnamese market in 2004 launched localized chicken menu and gained big popularity. As a result, the number of fast food branches of Lotteria is the highest in Vietnam. It is the representative successful case of analyzing local food culture and linking it to Korean style.
Jang Ho-geun, head of International Marketing Group of KITA said “Franchise is necessary industry for creative economy in terms of diversification of export items and promotion of service export. Korea International Trade Association will make its utmost effort to develop service industry and strengthen competitiveness by supporting domestic franchise companies to go abroad actively”.
