Hong Kong remains one of Asia’s most attractive markets for franchise expansion. With a high-income, trend-sensitive population, no foreign ownership restrictions, and a gateway role to the Greater Bay Area (GBA), it’s easy to see why international and regional brands are eyeing the city for growth.

Still, setting up a franchise here involves more than just signing a lease and printing menus. To successfully start a franchise in Hong Kong, you need to consider licensing, legal structures, staffing, and compliance from the outset.

Here’s a comprehensive roadmap to launching your franchise in Hong Kong, featuring insights from the HKTDC’s latest industry report and highlighting how InCorp can support you at every step.

Test Your Concept and Protect Your Brand

Hong Kong is home to 531 franchise brands operating approximately 60,000 branches as of 2023. This reflects not just the popularity of franchising, but also the density and competitiveness of the market.

In such an environment, testing your concept through a pop-up or delivery-only model is a smart way to validate demand before committing to a full rollout. With 43% of franchises operating in the F&B space, protecting your brand assets early is essential.

We assist clients in securing their trademarks across Hong Kong, Macau, and Mainland China, ensuring brand protection before they enter the market.

Set Up the Right Business Structure

Choosing the right business structure is one of the first and most important decisions when entering the Hong Kong market. For most franchisors, setting up a private limited company is the preferred option due to its flexibility, limited liability protection, and credibility with landlords, suppliers, and banks. This structure also makes it easier to expand or bring in investors down the line.

Compared to other structures, such as sole proprietorships or partnerships, a limited company offers better risk protection and more apparent tax separation between the business and its owners. Hong Kong’s streamlined incorporation system enables the entire setup to be completed quickly, often within just a few days once the necessary documentation is ready.

At InCorp, we guide you through the entire process, from selecting the right entity type to submitting your incorporation documents, obtaining a Business Registration Certificate, and meeting all post-setup compliance requirements. We also assist with opening bank accounts and provide ongoing support to ensure your company remains compliant as it grows.

Secure the Licences You’ll Need

Franchise requirements vary depending on your industry. Food outlets may need General Restaurant Licences, import permits, and signage approvals. In recent years, service-sector franchises such as tutoring, fitness, and pet care have gained significant traction in Hong Kong’s post-pandemic landscape, and each of these areas has its own unique regulatory path.

InCorp helps clients map out these requirements early, prepare supporting documentation, and coordinate with the relevant departments to ensure timely approvals.

Draft a Franchise Agreement That Works

While franchising is well established in Hong Kong, the city does not have dedicated franchise legislation. All franchise agreements are governed by general contract law. This makes it essential to clearly define rights, obligations, royalty terms, dispute resolution procedures, and branding controls in your agreement.

We support franchisors in reviewing and drafting compliant agreements and maintaining the necessary company records and statutory filings through our corporate secretarial services.

Build a Strong Financial System from Day One

Franchise profitability in Hong Kong depends on effective financial planning. According to Cushman & Wakefield’s 2024 retail rankings, Tsim Sha Tsui was the fourth most expensive shopping district in the world, with annual rents of US$1,607 per square foot (about HK$12,500). Central, another major retail area, recorded rents of US$721 per square foot).

These high costs make accurate forecasting and disciplined bookkeeping critical.

We help clients implement cloud-based accounting systems, link point-of-sale (POS) data, generate monthly financial reports, and manage Profit Tax filings. Whether you’re reporting to a corporate HQ or investors, we ensure your finances stay on track and audit-ready.

Manage Talent and Payroll More Efficiently

Staffing remains one of the top operational concerns for franchise businesses. Labour shortages and wage fluctuations continue to challenge F&B and retail operators in Hong Kong. Automating payroll and ensuring full compliance with MPF and employment laws can make a real difference to your bottom line.

We provide end-to-end HR and payroll support, including digital payslips, MPF management, leave tracking, and mandatory reporting. Our immigration team also handles work visa applications for foreign talent, including chefs, managers, and trainers.

Plan for Cross-Border Growth

For many franchisors, Hong Kong is not just a market—it’s a regional springboard. With its proximity to Mainland China and direct access to the Greater Bay Area (GBA), the city is well-positioned to support future expansion into nearby urban hubs, such as Shenzhen, Guangzhou, and Zhuhai.

Scaling into these markets requires more than just replicating your business model. Operators must navigate different licensing regimes, tax systems, trademark protections, and local business norms.

InCorp supports clients through every stage of their regional growth journey. From setting up compliant entities in Mainland China to securing IP rights across jurisdictions and aligning operating structures for scalability, we help you prepare for sustainable cross-border expansion, while maintaining control and compliance.

Where To Next?

Franchising in Hong Kong offers enormous potential—but also demands careful planning, local expertise, and precise execution. From incorporation and licensing to trademarks, HR, tax, and cross-border advisory, InCorp provides everything you need to launch and scale with confidence.

Thinking of starting a franchise in Hong Kong?
Let’s talk. Book your free consultation and take the first step toward successful expansion.