Franchise Articles

Franchise businesses are expected to grow and create more jobs at a faster pace than the rest of the economy in 2015 for the fifth consecutive year, according to "The Franchise Business Economic Outlook: 2015" released today by the International Franchise Association (IFA) Educational Foundation and IHS Economics.
"Franchising is an American success story. Independently-owned and operated local franchise businesses are growing faster, creating more jobs at a quicker pace and producing higher sales growth than other businesses. Franchising is a vital engine of economic expansion in the United States and 2015 looks to be another strong year for franchise businesses," said IFA President & CEO Steve Caldeira.
But Caldeira added a word of caution about the franchise outlook...

Chris Moore, a multi-unit Watermill Express franchisee, is in the enviable position of knowing exactly who his customers are, what they want, and why--and where--they want it. This has allowed him not only to become a successful franchisee with 92 water purification vending kiosks across the Houston area, but also to contribute to the community in an unusual way.
"Our freestanding structures, often in the middle of a parking lot at a shopping center, allow people to get purified water gallons at a time and 24 hours a day. This works especially well in Sun Belt states, like Texas, Florida, and California," he says.
"Our primary customer is a person from another country who didn't trust the water system where they grew up and so always had to drink purified water...

Apple, Google, Softcard, PayPal, Visa, and many others are together spending billions of dollars on digital wallet technology. The emergence of these eWallets is getting a lot of media attention as well, but what's in it for you?

What can you expect from a digital wallet?
An eWallet can hold the same items as a traditional wallet. These include ID cards (e.g., a digital driver's license), coupons, national currencies, and payment cards (bank cards, both debit and credit, gift cards, loyalty cards, and rewards cards). The purpose of an eWallet is not only to create an electronic storage location to hold these types of items, but to also to add intelligence to them that will simplify our lives. For example, an advanced eWallet will know when you are making a payment at a specific merchant location and can prompt you to redeem the value on a gift card - no more worry about forgetting your gift cards...

Local Search Adoption Slowed by Confusion, Complexity
Some smaller businesses still think that local search means hometown newspaper advertising, or confuse it with pay per-click (PPC) marketing. "Despite the available weight of evidence, some multi-location brands and marketers still profess confusion or, more commonly, struggle to operationalize 'local search' marketing," according to Greg Sterling in his blog on Search Engine Land. Despite plenty of well-documented results for brands that are taking advantage of local search strategy and tactics, many businesses continue to struggle to "operationalize" them; and opt to dedicate either in-house resources or hire paid ones to keep them at the top of the search results in their local markets...

Historically in franchising, real estate was coveted as a key strategic asset. Most franchisees overwhelmingly preferred to acquire the real estate as part of any new development and/or acquisition they were contemplating. Over the past 20 years we have observed an evolution in this franchise-real estate dynamic. Many franchise owners with substantial real estate holdings have been selling properties, and fewer new units are being developed with fee-owned real estate. Why the change?

Jim Lager is not one to brag about himself, he'd rather shift the focus to his businesses. Over the years he's become adept at building strong businesses and creating environments where people excel. He admits he's "pretty good at taking lousy businesses and turning them into something." And, he's quick to add, "I'm not a 'maintain' kind of guy--I hire people to maintain. But helping people succeed is something I want to be remembered for."
Lager, a U.S. Army veteran and natural entrepreneur, knew he wanted to start his own business and work in a hands-on environment after his military stint in Germany. Back home, he earned an MBA from the University of Minnesota through the GI Bill, then signed on as Snap-On Tools franchisee in Plano, Tex...

Multi-unit franchise operators are fostering the growth of franchise profit across the United States. In 2014 alone, franchise organizations drove about 3.5 percent of the total U.S. GDP and franchise operators employed over 8.5 million Americans. Multi-unit operators played an instrumental role in advancing franchise operations across the country this year, and will continue to move the needle on franchise success in the new year.
In an always-evolving retail, restaurant, and service economy, being part of a franchise corporation gives new and seasoned entrepreneurs the means to hit the ground running. Starting an independent business is tough, but existing as part of a larger franchise network provides the support and direction it takes to see success early on...

The nature of the franchise business is quickly evolving, but it's never been clearer that now is the optimal time to be part of a franchise organization. Franchises drove approximately 3.5 percent of the total U.S. GDP in 2014 and employed more than 8.5 million Americans. As it becomes riskier and more challenging to get off the ground as an independent startup, entrepreneurs are finding that it pays to be part of a larger franchise network that can support growth and boost initial success.

But as with any business venture, launching or running a franchise can have its speed bumps along the way. Achieving optimal sales and growth doesn't happen overnight. It takes ongoing commitment from franchise owners and operators. In 2015, I foresee a new set of challenges for franchises, largely prompted by three factors: new government regulations, crowded market share, and employees predisposed to entitlement and generational differences...

In the following months, FUSR will present highlights from the 2015 Annual Franchise Development Report (AFDR). The report is based on responses from 139 franchisors representing 36,313 units (32,693 franchised and 3,620 company-owned). This week: Top Sales Producers and Top Internet Sales Producers.

Alvaro Garcia already has 21 Jersey Mike's Subs locations in Southern California under his belt. And now he is in the midst of an aggressive 70-store development plan that matches an equally fierce work ethic.
The youngest of 10 children, Garcia was a teenager when he came to the United States from Managua, Nicaragua. He watched his single mother work ceaselessly at three jobs, seven days a week, including 12-hour shifts at a hospital on the weekend.
"She taught me to be honest, work hard, and not to depend on others," says Garcia, who got his start in the restaurant business (and his first job) at age 18 as a Domino's Pizza delivery driver in Alhambra, Calif. Within a year, he was managing that store and moved up the ranks quickly, first to supervisor and then to district manager...

This year's annual CFA Day Forum will be in Washington, D.C. from March 24-25 at the Omni Shoreham. The forum will include informational sessions, an attorney's round table, congressional visits, a Cherry Blossom Dinner Cruise, and a closing luncheon on Capitol Hill.
  Traditionally, the CFA Day Forum has provided an opportunity for franchisees and their vendor business partners to hear from well-known political speakers including Sens. John McCain, Lindsay Graham, and Rand Paul, as well as Committee Chairman Darrell Issa, Reps. Howard Coble, and Jared Huffman, and political pundits like Bill Kristol, George Will, and Sam Donaldson.
This year's agenda will feature subject matter experts on legislative hot topic issues and will boast a variety of informative and educational topics relevant to the franchisee community...

I've known Jason Silfies, vice president of marketing and technology at Coldwell Banker Real Estate for more than 10 years and find him to be one of the most rational, engaged marketing executives in the franchise and commercial real estate industries. We wanted to include him and the Coldwell Banker Commercial (CBC) brand point of view in this installment of CMO Outlook because of his tenure and leadership at the helm of a brand that has successfully weathered tumultuous industry undulations. Now, as the commercial real estate outlook heats up, how does he lead the brand to new levels of competitiveness and help the CBC affiliates thrive?

We asked him about the top three misperceptions of local marketing that derail success for CBC affiliates - and what they do to correct them...

Snapchat?? Wait, We're Still Mastering Facebook!
Small businesses continue to wrestle with social media. You know you have to be there, but where is "there"? Does every business need to be on every social media channel? How can you afford to pay somebody to take care of all those feeds, or find the time to do it yourself? There's only one golden rule for choosing your platforms: are your customers there? If not, move on. Treat the question about hiring a dedicated social media person the same way you would think about hiring somebody to answer the telephone - and while you don't need to handle Twitter or Facebook the same way you do a phone call (right now), you do need to respond to posts and comments quickly. Above all, don't think about social media as a numbers game...

Nachhattar Chandi says his story is one of overcoming "colossal odds" and the resulting "triumph" of coming to America to find success.
From walking 3 miles to school on India's dirt roads to founding and running a multimillion dollar business in his new country, Chandi believes his life embodies the American Dream. He came to the U.S. in 1991 and became a manager at a small gas station in Coachella, Calif. Three years later he owned the station and converted it into his first ARCO am/pm franchise.
Since then, Chandi, with his wife Susana and four children, has continued to build the business, creating hundreds of jobs in his Southern California communities. Today, the 43-year-old operates 17 ARCO am/pm locations, 3 Del Tacos, 6 Express Tunnel Car Washes, and one Subway...

Note: This is part 2. For the first four of the 8 tips, lick here for part 1.

A new book contends that to be competitive in today's fast-paced, technology-laden world, leaders and organizations must overcome their "human-ness." "Ironically, being human helps us and hurts us," says Edward D. Hess, a professor at the University of Virginia's Darden Graduate School of Business and author of Learn or Die: Using Science to Build a Leading-Edge Learning Organization. To stay relevant, he says, people must "de-humanize" themselves by overcoming qualities that hold them back from becoming the best thinkers and learners they can be.

Hess says that research in neuroscience, psychology, and behavioral economics has provided an unflattering picture of the way people think and learn...

Non-family businesses can learn a lot from family businesses, says Henry Hutcheson, a certified Family Business Advisor and founder of Family Business USA consultancy.
"Family businesses outperformed non-family businesses during the boom years leading up to the 2008 recession, and during the 2001 and 2008 recession years," he says, citing a recent Harvard Business Review study.
Hutcheson, author of "Dirty Little Secrets of Family Business," (http://dirtylittlesecretsoffamilybusiness.com), says family businesses were less likely to lay off workers during the lean times, and more likely to maintain their emphasis on socially responsible programs.?But that's just the businesses that survived.
"Many closed their doors," he notes...

In the following months, FUSR will present highlights from the 2015 Annual Franchise Development Report (AFDR). The report is based on responses from 139 franchisors representing 36,313 units (32,693 franchised and 3,620 company-owned). This week: telephone mystery shopping results. Ordering information can be found below.

This year's telephone mystery shopping, conducted by Marc Kiekenapp & Associates, contacted 146 brands to gauge the quality and timeliness of their response to a phone call from a mystery shopper posing as a qualified prospect.

Kiekenapp found some improvement, but many of the basics were still lacking at too many franchise brands. One in 12 brands (8 percent) somehow managed to have either no phone number or a wrong number on their website...

What's the difference between those that do and those that don't?
After decades of asking myself and thousands of others that same question, I have come to the conclusion that your success comes down to just one thing.
Whether you're trying to lose weight, save money, climb mountains, win a grand final, run a marathon, get a promotion, pretty much anything! One thing sets the winners apart from the losers, the achievers from the underachievers, the successful from the unsuccessful.
I have watched thousands of documentaries, read thousands of stories, and interviewed thousands of people and in every single case it's the same.
It's not having a positive mindset (although that helps), it's not having a secret formula (although having a plan helps), it's not where you were born or where you went to school, and it's not who your friends are or how much money you have...

It wasn't too long ago, in the midst of recession, the idea of selling a restaurant would have been fleeting at best.
Today, the idea makes sense for a variety of reasons, especially because there are plenty of investors available who are aggressively looking for places to spend their money. And many of them have their eyes on the restaurant industry.
Why? There are several reasons restaurants are attractive to investors:

Alvaro Garcia epitomizes the proverbial American dream. With 21 Jersey Mike's Subs locations in Southern California already under his belt, Garcia is in the midst of an aggressive 70-store development plan that matches an equally fierce work ethic.
The youngest of 10 children, Garcia was a teenager when he came to the United States from Managua, Nicaragua. He watched his single mother work ceaselessly at three jobs, seven days a week, including 12-hour shifts at a hospital on the weekend.
"She taught me to be honest, work hard, and not to depend on others," says Garcia, who got his start in the restaurant business (and his first job) at age 18 as a Domino's Pizza delivery driver in Alhambra, Calif. Within a year, he was managing that store and moved up the ranks quickly, first to supervisor and then to district manager...