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Potato Corner started as a single cart at SM Megamall in Mandaluyong in October 1992 and began franchising the following year, which gave it the capital to grow faster than it could on its own. When it took the brand to the United States, GMB Franchise Developers’ Lyndah Bartolome was on board as its franchise consultant, and Butz Bartolome counts Potato Corner among the 350+ brands GMB has helped grow.
The starting point: one cart and borrowed capital
Potato Corner was founded in 1992 by four partners: Jose “Jomag” Magsaysay Jr., Ricky Montelibano, Danny Bermejo and Jorge Wieneke. The idea came from Montelibano’s flavored popcorn business: put flavored powder on French fries. The partners borrowed the ₱150,000 starting capital, and they could only afford a cart. Within 30 days they had paid back their loans.
Magsaysay had worked at Wendy’s for nine years and left that job for Potato Corner, so he brought real food-service operating experience to the business.
What made it franchisable
- A simple, repeatable operation. As Butz wrote about the brand: “Concept and product need not be sophisticated. POTATO CORNER is a clear example, simple operations and known product but with a twist and unique proposition.”
- Proven demand. The first cart paid back its starting capital within a month.
- A small format. A cart needs far less space and money than a restaurant, so it’s easier for franchisees to open one.
- A clear business DNA. Butz credited the brand’s growth to “its unwavering focus on its business DNA” and its ability to adapt to different markets.
How the system was built
At home, it started informally. Franchising was still new in the Philippines. Magsaysay knew the basics from his time at Wendy’s. The first franchise agreement was copied from the internet, and the first three franchises were closed on handshakes, with no manuals. The franchised stores grew faster than the company-owned ones, and Magsaysay later said, “It’s because of franchising that we were able to dominate the market.”
Abroad, the system was formalized. Potato Corner opened in Indonesia in 2006 and entered the US in 2010. Butz noted that entering the US “was an entirely new process for the company”. Potato Corner registered its franchise in California, a state known for strict franchise rules, and became a full franchisor with a Franchise Disclosure Document registered in four states. In October 2012 it had its own booth at a franchise expo in Anaheim, California. Its owners were there together with their franchise consultant, Lyndah Bartolome of GMB Franchise Developers.
Handshakes can start a franchise, but growth across borders needs documents, compliance and a system that can be taught. That is the work behind GMB’s franchise development services.
5 lessons for Filipino business owners who want to franchise
- Prove the unit first. Potato Corner’s first cart paid for itself quickly. Make sure your own store makes money before you sell the model. See Step 1 of our guide to franchising your business in the Philippines.
- Keep it simple enough to copy. A known product with a twist, run by simple operations, is easier to teach to franchisees.
- Don’t stay on handshakes. Potato Corner’s early franchises were informal. Today’s franchisors should start with proper agreements, manuals and training. Here’s what it costs to franchise your business.
- Protect your business DNA. Adapt to each market, but don’t lose what makes your brand yours.
- Dream global, but prepare for it. Every new country has its own rules. Get the right help before you go. Here’s how to choose a franchise consultant.
Ready to write your own franchise story?
GMB Franchise Developers has been helping homegrown brands franchise since 1993. It was founded by Butz Bartolome, “The Franguru”, who has been in franchising since 1991: 35 years in business and 350+ brands helped, from our office in Mandaluyong.
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Frequently asked questions
How did Potato Corner start?
Potato Corner opened as a single cart at SM Megamall in Mandaluyong in October 1992. Its four founding partners borrowed ₱150,000 to start it.
When did Potato Corner start franchising?
Potato Corner began franchising in 1993, the year after its first cart opened. Its first franchises were informal, and some were closed on handshakes.
How did Potato Corner expand abroad?
Potato Corner opened in Indonesia in 2006 and entered the United States in 2010. In the US it became a registered franchisor with a Franchise Disclosure Document, and GMB Franchise Developers’ Lyndah Bartolome served as its franchise consultant.
Can a small business like a food cart be franchised?
Yes. Potato Corner shows that a simple product and a small format can be franchised, as long as the unit is profitable and the system can be documented and taught. GMB Franchise Developers can assess whether your business is ready.