Over 300 small businesses are targeted to benefit directly as the Lagos State government is set to launch a franchise framework development scheme for Micro, Small and Medium Enterprises (MSMEs) operating in the state.
Solape Hammond, the special adviser to the state governor on Sustainable Development Goals (SDGs) and Investment, who disclosed this, said the scheme designed to expand the frontiers of the local market, evolved out of the need to further strengthen the existing public-private business ecosystem with the aim of developing the sub-sector.
“Out of the need to strengthen the existing public-private business ecosystem with the aim of developing the sub-sector, Lagos State Office of Sustainable Development Goals and Investment in partnership with Franchisors and Distributors Forum will be launching an initiative tagged ‘Franchising as an Investment Alternative in Lagos State: A capacity building for 300 Lagos MSMEs”, Hammond said.
She said the programme targets MSMEs in the classic franchise domains, including product manufacturing, services, food and drinks, health and wellness and other personal care services, professional services, investors/commercial banks, cooperative societies, media as well as other MSMEs and individuals within the value chains.
According to Hammond, the pilot scheme which is designed to expose 300 MSMEs to the franchise business system will support these Lagos-based franchises to develop their unique franchise model and help them get investment-ready.
There will also be a periodic financing forum for both franchisors and franchisees to help deepen opportunities to collaborate.
“Part of the plan is to identify 20 MSMEs with the strong potential of growing between five outlets in the first year and 10 in the next 30 months and then provide the structure and franchise growth support, including various intellectual property registrations”, she said.
Hammond, who explained that the business model was crucial to job creation, economic diversification, creativity and income redistribution, stated that the state has shown tremendous interest in helping SMEs get access to affordable financial and other institutional support they need to create wealth and employment for the youth.
“Lagos being the hub of MSMEs on the west coast, with a concentration of 3,224,324 micro operators and over 11, 663 SMEs operators will benefit from this business model as part of efforts towards building an inclusive economy”.
She emphasised the need for a fair platform for partnerships and linkages between operators and government agencies to discover innovations and opportunities that will boost the economy, adding that the simplicity of franchising makes it a good way to unleash the growth potential of MSMEs.
“There are great prospects for franchising to contribute to the development of entrepreneurship, create more jobs, evolve more rapid training and skill development, improve the quality of business, improve the ethical climate of the domestic business and build brand equity for Lagos businesses.”
On the criteria for selection, the special adviser stated that aside from having been in operation for a period of 24 months with sound management prospects, the MSME must have the potential for attracting investors/franchisees with a progressive annual revenue. They must also be based in Lagos and ready to expand around and beyond the state.
“Now that the Africa Continental Free Trade Area (AfCFTA) is in effect, we want to support businesses in Lagos to scale across the continent and even beyond.”
Hammond pointed out that the initiative will enhance the rightful role of SMEs in wealth and job creation, poverty reduction and stimulation of growth of the domestic economy as this administration is committed to building a 21st-century economy.
“We are optimistic that franchising would be a useful tool in delivering our economic goals as a state as it offers a viable model to develop MSMEs in Lagos” she asserted.
She maintained that the initiative will offer a genuine path for wealth creation and scale-up business activities around MSMEs. The most critical factor in franchising is the discipline franchisees must learn in order to successfully run franchises.
It will ensure effective coverage for franchising in the state which will enable the small and medium businesses to be sustainable and contribute to the economy of the state”, she said.
While encouraging entrepreneurs in the focused sectors to take advantage of the scheme, the special adviser said interested organisations should apply via: www.lagosfranchisepilot.com/apply
Tayo Adedugb, the founder of FRANDIS Forum, said the programme was designed to support the growth of MSME businesses in alignment with the government’s economic vision through a result-oriented and impact-driven franchise strategy.
He said the scheme was inspired by the need to have the state government spearhead a momentous and transformative movement to build a thriving and sustainable franchise industry in the country.
“The collaborative model we are adopting is to establish a franchise culture and mindset as part of the overall entrepreneurship values that drive the growth of the MSMEs in the state’’, he said.
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