Financial Sustainability: Lessons from the WFMC Franchise

2nd Global Conference on Social Franchising for HealthOctober 22-24, 2014Crimson Resort and Spa, Mactan Island, Cebu, Philippines

Presented by Easter Y. Dasmariñas

Outline of Presentation

• Brief Background on the WFMC Social Franchise

• Financial Sustainability As a Goal• Role of PhilHealth in the Sustainability of the

Clinics• Financial Sustainability of Franchisor: Risks,

Challenges and Opportunities

The WFMC Social Franchise

• Established between 1997-2003 under a USAID supported project called TANGO;

• Business model served many characteristics of a commercial franchise including financial sustainability

• JSI served as de facto franchisor, NGO as area franchisor

• WPFI established to sustain the business model of the clinics and the operations of the franchise system

Financial Sustainability as a Goal

• Two pronged : sustainability of the clinics and sustainability of the franchisor

• Moving toward a commercial agenda, finding a viable balance between the original social goal of increased access to quality services and the profitability and sustainability.

Role of PhilHealth in Clinic Sustainability• Accreditation of Service

Providers and Birthing Facilities for the Maternal Health Package (MCP)

• WFMC Inputs to the Development of MCP Package (clinic physical and service standards)

Role of PhilHealth in Clinic Sustainability

• Role of franchisor in MCP accreditation of WFMCs

• 80-85 % of WFMC clients are PhilHealth members ; brand equity

• Financial sustainability at clinic level doable, business model works

Financial Sustainability of Franchisor

• Managing transition from project to WPFI

-Balance between ensuring the operating sustainability of the clinics and developing the capability of franchisor to provide the essential services for the franchisees • Income from franchise and royalty fees,

other products and services to support franchisor operations

Financial Sustainability of Franchisor

• Ten-year business plan, CEP with business plan • Royalty fees of current number of clinics not

enough to support operations of both franchisor and area franchisor

• Current organizational set up of franchise operations will not allow for the expansion of the franchise network; TA and investment from external sources will be made available

• Long term sustainability at the franchisor level will never be doable unless organizational reforms will be undertaken;

Thank you!