Enterprises in an increasing number of sectors, such as hotels and education, are tapping the franchise market in China, said experts.

Different from previous sessions, which were largely dominated by catering businesses, a number of hotels attended the latest Franchising China conference and exhibition held recently in Beijing. They included foreign hotels Super 8, Holiday Inn Express as well as domestic hotels Home Inn and Jinjiang Inn.

The exhibition, which has also been held in Shanghai and Guangzhou this month, attracted education enterprises, such as Shanghai BabyArt and Singapore's Ready to Learn, as well.

"Franchising is an ideal way for entrepreneurs to start a new business. Start-up costs are relatively low, with about one-third of franchises in China requiring an investment of less than 100,000 yuan," said Craig Pepples, chief operating officer of the organizer, Global Sources.

Beijing is an excellent franchising market, where retail sales grew more than 13 percent year-on-year in 2006, he said. "And during the 2008 Olympic Games, 500,000 overseas and 1 million domestic visitors are expected to spend about $4.5 billion on retail goods and services."

There are more than 2,600 franchise systems now operating in China, an increase of 13 percent from a year ago.

Ricky Lim, managing director of Breadtalk China, expects franchising to account for a larger proportion of his business in China in the future. The company set foot in Beijing in 2004 and now operates 60 direct and franchising stores in China.

(China Daily November 21, 2007)