THE EFFECTS OF ASEAN FREE TRADE AREA (AFTA) TOWARDS FRANCHISE BUSINESS IN INDONESIA: STUDY ON KILLINEY KOPITIAM (2006-2014)

Abstract

ASEAN Free Trade Area or also known as AFTA is an agreement about the free trade among ASEAN member countries which is agreed in 1992. AFTA impementation is expected could bring benefits for the members countries, including the Small Medium Enterprises (SMEs) businessmen in each country including Indonesia. One of the examples of SMEs is franchise business, in which the franchise business is expected could gain benefits from the implementation of AFTA. Killiney Kopitiam is one of foreign franchise business that already spread its wing in the Indonesia market since 2006. This research aims to describe the benefits and challenges that Killiney Kopitiam gains in Indonesia since the implementation of AFTA that limited in the period 2006-2014. The writer did a SWOT analysis of AFTA that later through that analysis, the writer found both benefits and challenges emerge and perceived by the business of Killiney Kopitiam in Indonesia, which include several sectors such as: economics, investment and cultural. Through some benefits that Killiney Kopitiam could gain from the implementation of AFTA, Killiney Kopitiam got more chances to expand its business operation in Indonesia and increases its income. Challenges appear from the similar. The main concern of Killiney Kopitiam is how it can overcome those challenges and developing in the business. Along with the existence of Killiney Kopitiam's business operation in Indonesia, the business of local coffee shop seems threaten. The local coffee shop is expected cal overcome this issue by being more innovative in the market.