International Franchising: What You Need to Know
You’ve probably noticed pictures from friends’ travels have some surprising things in the background: a McDonald’s in Hong Kong? A Domino’s in Mexico City? International franchising is often the next step for a lot of franchises who have already built a strong brand in their home country. Why are businesses drawn to it? There are many reasons:
- Brand expansion
- Create diverse future profit and revenue centers
- Low-risk and low-initial investment when compared to starting to a traditional business
- Reducing dependence on domestic demand
- Lots of potential for growing and scaling the business
So, let’s dig into the nuts and bolts of international franchising: what it is, benefits, and resources that can help when you’re ready to go global with your franchise.
As you may know, franchising is a way of doing business where a parent company sells their business model to individual owners (franchisees). Once they have purchased a franchise, an owner has access to the parent company’s business model, marketing, products, etc. These franchises operates on the same principles, with the focus of expanding its brand into countries other than their country of origin.
There are several benefits for companies and entrepreneurs who decide to take the leap into international franchising:
- New markets
- More customers
- Foreign master franchise owners [These are franchise owners who are from the countries into which a business is expanding. They’re the international equivalent of regional developers, and they can mean big money for the parent company and the franchise owners.]
If you’re interested in international franchising, here are some of the best resources to check out:
- International Franchise Association: This should be your first stop to learn about international franchising. They feature country profiles, informative articles, and detailed information on international franchising laws and how to make sure you follow them.
- Franchising World: A magazine with helpful information on international franchising. The website offers digital versions and archives of past issues.
- FranCast Newsletter: Get everything you ever wanted to know about international franchise law from their newsletter.
- Grow Smart, Risk Less by Shelly Sun: How to franchise an existing business
- International Franchising: A Practitioner’s Guide by Marco Hero: A “bible” for anyone involved in international franchising
If you’re looking for a career path with a company that’s already global, check out our franchise opportunities. Things are only looking up from here!