CEO & Founder – Augment (Pvt.) Ltd., Pakistan & Vibrant Brands International (Pvt.) Ltd.

Evolve: Please share something about yourself, a brief overview of your professional journey? 

Samiullah Mohabbat: As the founder of Augment Pvt. Ltd, I wanted to provide a platform for franchising industry in Pakistan. Since 2011, Augment is providing a guiding light to aspired franchisees, entrepreneurs and international franchise brands who keep an interest in Pakistan market.

My professional journey started 13 years ago and is full of learning and achievements. My whole career reflects my experience backed understanding of restaurant and franchise business as I started this journey from KFC Pakistan in 2003, and successfully climbed the career ladder to the higher management, won the YUM award to represent the company & country in an international RGM convention, held in Budapest, Hungary. 

Having an invaluable knowledge and expertise of franchising industry, I have worked with hundreds of entrepreneurs, business owners and leading multinational brands to develop various franchise businesses in Pakistan. A breakthrough of my expertise in the franchising & restaurant industry is the acquisition and launch of Hardee’s franchise for Pakistan as COO in 2008. It includes end to end working from idea generation to accomplishment, establishing the whole company structure, business planning with local and international team at strategic level, identifying business opportunities for the company in the local and international markets, overcame complex business challenges and making high stakes decisions within fast-paced, high-pressure environments using experience-backed judgment, innovation, strong work ethic, fun, and irreproachable integrity. 

Second career breakthrough came in 2011 when I setup Augment, signed associate membership with World Franchise Associates, acquired Fatburger’s master rights for BIL Foods Ltd and joined BIL Foods as CEO for Pakistan. 2014, other than Franchise Consultancy Business, I planned to enter in food retail business and setup a company called “Vibrant Brands International Pvt. Ltd.”. Later that year, Vibrant Brands acquired the master franchise rights of “Cone Heads” an Australian Chips and Burger Brand. 

Today, we have 04 restaurants in operations, whereas 06 restaurants are under construction across Pakistan. In fact, Augment has a team of experienced professionals who are in this industry quite a while and possess ample amount of experience for the new country launch of any brand and then make it successful.

Evolve: Kindly guide our readers about Franchise Business and its future scope especially in terms of Pakistan?

Samiullah Mohabbat: Pakistan is still a very high potential market and attracts lots of global brands. The way law and order is improving, CPEC and other national projects are moving, I am confident that they will bring lots of opportunities. Imagine a service area on every 40KM with lots of retail concepts, similarly imagine the population strength and ever increasing demand for brand experience, we just need to prepare ourselves for the growth because this is going to be a turning point and the growth might come faster than we imagined. Franchising industry has saturated in many international markets but in Pakistan it has just entered a rapid growth cycle with excellent future prospects.

Evolve: What type of services do you provide to your clients? 

Samiullah Mohabbat: At Augment, other than many small business services, there are two key services 

1. International Franchise Acquisition
2. Country Brand Launch Assistance 

International Franchise Acquisition includes:

• Professional Consultancy Services to approach and acquire a franchise
• Assist with the drafting of a professional business profile for the client
• Develop preliminary financial analysis and business plan for the franchise opportunity as and when required
• Assist and guide through the entire application process until final approval
• Provide advice and guidance in negotiating the commercial terms of franchise agreements
• Provide facilitation and arrangement of meetings with the companies offering franchise opportunities
• Introduction of new franchise opportunities as and when they occur
• Handle specific opportunities already known to the client

Since majority groups and investors in Pakistan do not have restaurant and retail back ground, whereas all the international brands look for a franchise partner who has relevant industry experience and knowledge, there comes the role of Augment to get your application qualified and to assure Franchisors that their brands are going to be in safe hands. Augment assist, educate and train the new franchisees about their new business operations to safeguard their investment. This includes 

• Company start-up, structure and head office setup advice
• Advice on site selection and construction side of the project
• Advice on Business support systems development
• Business operations support
• Advice on Business strategy, Marketing Strategy, Market entry strategy
• Sub-Franchisee Program Development and Sales management

Evolve: Do you deal only in food related franchise development or also address other sectors? 

Samiullah Mohabbat: We deal in all kinds of food, retail and services brands.

Evolve: Are you doing this struggle at your own or associated with some global association? 

Samiullah Mohabbat: Both. Augment is the exclusive associate member of World Franchise Associates(WFA), a UK based international franchise development organization having its offices around the globe.

Augment have direct relationships with many international brands which are willing to expand in Pakistan. 

Evolve: How do you connect the buyer and seller? What is your marketing strategy? 

Samiullah Mohabbat: There are so many ways to connect such as newspaper ads, social media, email marketing to the data base of high profile clients, SEO etc. but the most effective is word of mouth. We try to facilitate our client with best of our knowledge and sincere advice. It’s hard to earn money and easy to lose, so we believe choosing right brand and launching it professionally is the key to success.

Evolve: Are you planning to conduct regular conferences or seminars in Pakistan to enhance awareness about franchise owning business? 

Samiullah Mohabbat: Yes, we are planning to work aggressively as economic indicators are getting better. We are planning to arrange franchise business forums and related publications in all major cities of Pakistan to enhance franchising business awareness. We also have plans to arrange an International Franchise Conference in Lahore.

Evolve: Do you foresee that in future Pakistani brands can also be offered globally? 

Samiullah Mohabbat: I strongly believe that Pakistani brands have lots of potential and they are proving it in international markets. There are two areas to be worked on before going international. 

1. Franchise Documentation; This includes all agreements, trademarks, operations and brand manual etc. 
2. Franchise support infrastructure. Going international is easy but managing growth, ensuring systems, procedures and quality are difficult and it needs lots of strategic changes in your organizational infrastructure including people and knowledge.

I have met lots of Pakistani brand owners; everybody wants to expand but nobody wants to invest on infrastructure for sustainable international growth, this attitude has put us away from many international opportunities. Initially one must invest in promotion and expansion of their international development before expecting any returns.

Evolve: It is really very difficult to meet and then maintain the standards as there are certain financial and legal affairs, how do you support the buyer and seller in these areas? 

Samiullah Mohabbat: I don’t think that it’s that difficult to maintain the standards as all the international brands have proper support infrastructure to ensure that standards are met. They often visit and provide training and conduct audits. About second part of the question, I strongly feel that Pakistan’s franchise laws need to be upgraded with international franchise laws. There are so many restrictions in terms of franchise and royalty payments which are not acceptable to many brands. As we have enough knowledge of all legal and financial requirements so we try to provide best solutions to acquire and operate international franchises.

Evolve: What is your analysis about the success ratio of franchises offered by you in Pakistan? Are your clients happy and making money? 

Samiullah Mohabbat: Success ratio has been very encouraging and it will even improve in the future. There have been certain reasons to that which I believe would further improve business success in upcoming years.

1. Law & Order situation: This has stopped all the international visitors to come to Pakistan in past. A tourist comes to spend which allows brands to make additional profits and invest on expansion. You can only expect a limited amount of business from locals.
2. Incompetent behavior of authorities: There are always issues around the world but no country posts the pictures of their restaurants in social media. This approach has destroyed the country image and business as people do not want to eat out. If there are issues, first people should be educated and then they should be addressed quietly.
3. Poor economic growth: There has been no visible economic growth which might have increased the buying power of people. In fact, buying power of the people have gone down and on the other hand cost of goods for brands have gone up, but due to the decreased buying power brands couldn’t afford the price increases. However, with the improvement of country’s economic condition, overall business success ratio will also improve.
4. High Food cost: Food cost is high for restaurants because there are lots of imports involved. We do not have enough related industry which can produce ingredients as per international standards. Low pricing and High food cost reduces the profitability. Once we have enough local infrastructure of good suppliers, overall profitability will increase.
5. High Taxes and Custom Duties: I strongly feel that government’s only focus is to manage their expenses through taxes. This is also one of the big reason of high food cost as well. I have hardly seen 17% tax in the world on sales. People do not want to pay high prices and business operators such as restaurants cannot sell at low prices, there’s an urgent need for government to review its tax and custom duties to further improve international business viability in Pakistan. 

Lastly people should value the knowledge of business consultancy firms and take proper short term and long term advise. This is another reason of failure, once franchise rights of a brand are signed, people stop taking the advice. They try to run the new business at their own, and end up making costly mistakes and lose the investment. One should understand that there is no shortcut of experience and the experienced advice should be taken.

Evolve: Are there any other companies in Pakistan offering franchises or you are the only one? If there are some companies, then what is the difference between you and others? 

Samiullah Mohabbat: There are other companies started after our initiative but nobody could gain that level of success and response. Difference between us and other companies is of real time, hands on market experience, exclusive association with the world’s largest international franchise development organization and after sale brand launch advice & ongoing support.

Evolve: What type of companies and businesses impress you and why?

Samiullah Mohabbat: I like restaurant and other retail businesses, my whole career moves around restaurants. You can say, food is my passion and I have been very successful doing this, Alhamdulillah. Though there are challenges and which need to be addressed to make it more rewarding but yet this industry gives you lots of local and international recognition.

Evolve: In your view, what is the recipe to achieve long-term success? 

Samiullah Mohabbat: Hard work with consistency: I would say to treat this business like any other industry. When you set up an industry, you pour money into it, bear loss for some time until you find a clientele base. It takes time to get customers taste developed. Your cost is more as your sales are less, so if we stay consistent and keep working on sales enhancement and cost reduction, we can easily turn this business into high profits. 

Marketing: I have seen people opening up restaurant and then closing it after two months. Sometimes sales are not as per the expectations but it does not mean that restaurant does not have potential. Most of the times, people spend a lot on restaurant building but run short of money at the time of marketing. We should have separate budget for marketing before we start construction. 

Location: Location does matter, an expensive and wrong location is like a perfect suicide attempt. In high profile markets, your rent should not be more than 10% of sales where as in smaller cities or side location, rent should not be more than 5-7% of your sales.

Evolve: Any message for the readers of EVOLVE magazine? 

Samiullah Mohabbat: If you are a potential buyer, please do proper research and trust us as your franchise business consultant. We can help you identify right brand which has genuine potential and help you negotiate the best deal which can give you long term business benefits. 

I have seen people, they come up with a mindset to acquire certain category of brand based on their likeness or whatever going in the market. This trendy growth does not last for long. I have seen so many frozen yogurt brands closing down, just because it was trendy growth. We are a nation which cannot afford luxuries, we still want something which is economical and can fulfill our appetite. Such luxury brands are successful in developed countries where they have high buying power.