Jamid Movsumov: «Entrepreneurs acquire a famous brand during franchising»

The interview with Jamid Movsumov, Chairman of the Board of the Azerbaijan Franchising Association (AFA) on Fins.az:

-The Azerbaijan Franchising Association has undertaken several successful projects. What projects is the Association currently planning to work on and create new collaborations?
-The Azerbaijan Franchising Association was established on July 30, 2022, with a primary goal of collaborating with global companies. Since its inception, the association has made significant strides, including the establishment of the first production facility within a year. Notably, a Turkish entrepreneur initiated the production of a chocolate company in Guba, with planned investments totaling one million dollars. Additionally, we've recently signed a contract with a well-known Hungarian company, which has established another office in Azerbaijan. Furthermore, we've partnered with the Institute of Physics of the Ministry of Science and Education of the Republic of Azerbaijan to prepare and submit a new proposal to Azerbaijan in collaboration with a Hungarian company. Our ongoing negotiations with England, Germany, and Turkey aim to establish charging stations for electric vehicles in Azerbaijan. Lastly, we are diligently preparing for the Turan Economic Forum, scheduled for February, which will feature a forum and a fair to facilitate mutual cooperation among entrepreneurs and investors.

- Franchising experts view additional income from payments to the brand owner positively. What should entrepreneurs consider when buying a franchise in Azerbaijan, and what are your recommendations?
- Entrepreneurs often misunderstand franchising, perceiving it as an added financial burden. However, this notion is misguided. When purchasing a franchise, entrepreneurs acquire a recognized brand with an established customer base, facilitating business success. Financial literacy is crucial in navigating the franchising landscape, as uninformed decisions can lead to challenges and losses. To mitigate risks, we negotiate franchise costs with brands to align with the Azerbaijani market. It's imperative for entrepreneurs to assess the market, form a competent team, and prioritize quality service delivery.

- There seems to be a lack of understanding regarding franchise sales, necessitating your services. What forms of franchising do you recommend implementing?
- Various forms of franchising exist, but master franchising is particularly advantageous. In master franchising, entrepreneurs serve as the brand's representative in their country, allowing for greater control and profitability. However, it's essential to ensure that franchising initiatives are investment-oriented to maximize returns and minimize risks. While several supermarkets in Azerbaijan operate as franchises, strategic planning and adherence to branding standards are essential for success.

- Small and medium-sized businesses play a significant role in the country's economy. How do franchisors and franchisees contribute to this sector's development?
- Franchising presents a viable option for small businesses seeking growth and branding opportunities. By franchising small enterprises, entrepreneurs can access resources and expertise to streamline operations and comply with industry regulations. As an association, we advocate for the certification of specialists to enhance service quality and support state initiatives. Brand recognition instills trust in customers, facilitating market penetration and customer loyalty.

- Do entrepreneurs prefer brand recognition, traditional monthly payments, or existing business models?
- Entrepreneurs face significant costs when creating a brand from scratch, making existing brand acquisition an attractive option. By purchasing an established brand, entrepreneurs can leverage existing social networks and branding concepts, minimizing costs and accelerating market entry.

Source: www.fins.az