IFA Members come together for IFA’s Second Annual California Franchising Day at the Sacramento Capitol

On March 4, IFA brought together over 25 member franchisors and franchisees for our second annual Franchising Day at the California State Capitol in Sacramento. Among the brands represented were, California Closets, CKE Restaurants, The Entrepreneur Authority, Franchise Services Inc., FranNet, Glass Doctor, Home Instead Senior Care, Interim HealthCare, IHOP, McDonald’s, Mr. Rooter, Plumbing Md, ARCO ampm, Instant Imprints, The UPS Store, Marriott, Yum! Brands, Schlotzsky’s and more.

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The wide array of brands and industries represented at the event helped drive the message to policymakers that franchising has a significant economic impact in California, which continues to thrive in the current regulatory climate due to the partnership that exists between franchisees and franchisors.

Mark Justice, EVP & COO, MR. Stax, Inc., an IHOP franchisee based in Valencia, echoed the importance of being engaged in IFA’s advocacy efforts. “An eye-opening experience! Not only did we influence and educate our state’s lawmakers about the franchise business model, we walked away with a better understanding of the political process in California.”

Attendees heard from several Committee Chairs and leadership from both parties in the morning as well as Nancy McFadden, a top advisor to Governor Jerry Brown, before breaking into smaller groups for more than 40 meetings with individual legislators throughout the afternoon. The meetings were a resounding success.

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Chris Mesker of The Entrepreneur Authority in Sacramento explained, “It was clear to me that our legislators were interested in learning how franchising is really geared for the small business owner vs. large corporation. Getting the opportunity to educate them on the business model and economic impact was a huge step in having them understand how vital we are to the fabric of California. The impact we made was very apparent. It was a great day and I can’t wait to be involved moving forward.”

During the meetings, attendees shared stories about their businesses and the importance of  franchise businesses in California and the nearly one million jobs they create. In a proactive approach, IFA and its members made the most of their time with legislators, advocating on behalf of this proven business model.

“Without the face-to-face legislative interaction with the IFA and its members, many legislators and their staff would have no exposure to franchising and a limited understanding of this small business employment engine,” said Don Conger, of Financial Services, Inc., the franchisor of Sir Speedy and TeamLogicIT, among other brands based in Mission Viejo.

Driving this message home was Don Higginson of The UPS Store in San Diego. “The jury is out on franchising. This business model has been around nearly 50 years now and has flourished under the current regulatory system.”

In conjunction with the event, an op-ed by IFA President & CEO Steve Caldeira and Mr. Rooter of Sonoma County franchisee Saunda Kitchen appeared in Fox & Hounds, entitled “Franchise Business is a Team Sport”. The op-ed provides a unique look into how franchising allows entrepreneurs to go into business for themselves, but not by themselves with the support of a franchise system.

Moving forward, IFA will continue its outreach and engagement in California inviting legislators to in-district meetings and roundtables this spring and summer.

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Businesses Need Comprehensive Tax Reform Now to Grow

IFA Pres. & CEO Steve Caldeira, CFE, and Business Roundtable Pres. John Engler summarized their insights on what it takes to help businesses thrive:  comprehensive tax reform.  The recent op-ed has appeared in publications across the United States and Canada.

“Modernizing and simplifying our outdated tax system, in a comprehensive manner for both large and small businesses is a necessary catalyst for more robust business investment, a stronger economy and a healthier job market with wage growth that creates more opportunities for all Americans,” they wrote.

The two business leaders agree that “Comprehensive tax reform should simplify the tax system and allow American businesses and their workers to compete and win both at home and abroad. And in today’s modern economy, small businesses compete and increasingly win globally; in fact, approximately 26 percent of globally engaged U.S. companies are classified by the U.S. government as small businesses.”

Read more here: 

Placements include:

Franchise ACA Roundtable: “Changing the definition from 30 to 40 hours would be tremendous”



“Changing the definition from 30 to 40 hours would be tremendous for us,” said Dione Heusel, vice president of human resources and training for Smoothie King Franchises, according to a recent article in The Advocate.

This was the clear conclusion at a roundtable discussion on the Affordable Care Act (ACA) and our efforts to return to the traditional definition of a full-time worker under the ACA. Kelly Rogers of Two Men and A Truck, Scott Taylor of Last In Concepts, David Lewis of Express Employment Professionals, and Dione Heusel of Smoothie King joined IFA’s Matt Haller and I this week at the International Franchise Association’s (IFA) 54th Annual Convention in New Orleans to discuss the challenges franchises face with the Affordable Care Act.

The ACA has effectively changed the definition of a full-time worker from 40 hours to 30 hours by stipulating that businesses with over 50 full-time equivalents (FTE) must provide health insurance to anyone working over 30 hours a week or pay a penalty. As outlined in a report by the Hudson Institute in 2011, this provision would prohibitively raise costs, putting 3.2 million franchise workers at risk of losing hours and wages. A follow up study by Public Opinion Strategies found that 31 percent of franchise businesses have already reduced worker hours. These concerns were echoed by all participants in the roundtable.

Taylor emphasized a shift among businesses to more explicitly manage their workforce so that full-time employees work 40 hours a week and part-time employees work no more than 30 hours a week to manage costs. “Businesses are going to spend an awful lot of time trying to manage hours,” he said. “While this might reinforce good disciplining among management, it’s also not what grows companies.”

Lewis agreed, stating that variable employees want flexibility on hours and would prefer to keep their current schedules. However, the ACA’s 30-hour rule makes flexibility impossible in low margin businesses that need to closely monitor costs.

Rogers also highlighted the disincentive the 50 FTE rule. According to her, some franchisees are working to stay under the 50 FTE threshold to avoid a significant cost increase, which will reduce economic and job growth.

The IFA has advocated for a return to the traditional definition of full-time and has supported bi-partisan bills such as Rep. Todd Young’s (R-IN) Save American Workers Act, Sens. Donnelly (D-IN) and Collin’s (R-ME) Forty Hours Is Full-Time Act, and Rep. Daniel Lipinski’s (D-IL) Forty Hours Is Full Time Act. These bills would reduce costs for employees and give them the flexibility to reward good work with more hours, avoiding a rigid bifurcated labor force that does not support growth.

Some say bills like Rep. Todd Young’s Save American Workers Act, which returns the definition of full-time to the traditional 40 hours a week, will cause employers to reduce hours for those working over 40 hours a week. All participants pointed out that they are already offer benefits to those working over 40 hours a week, not because they have to, but because it is a long-term investment in talent that is essential for growing their business.

“Every business wants to have the best talent,” emphasized Smoothie King’s Heusel. “We’re a growing brand, and we have to have ‘bench strength,’ meaning we rely on our full-time employees to develop the skills, proficiency, and knowledge we need to grow our business.”

Taylor even joked that if he reduced his full-time staff’s hours to avoid offering health care, somebody else at the table would just snatch them up.

While IFA and its members see the second delay in the employer mandate as somewhat helpful, it is not the permanent fix businesses need so they can invest confidently.

Specifically, Rogers found that while the delay might be considered helpful, Two Men and A Truck franchisees are waiting for clarity on final rules so that they can best understand their cost structure. “I’ve got people sitting on capital, waiting to go into new markets, but they’re afraid to do it,” she said.

See The Advocate’s full piece HERE.

No Limit Agency and SMB Franchise Advisors raise money for VetFran

Nick Powills, CFE, founder and CEO of the full-service communications firm,No Limit Agency, came up with the idea for a dunk tank benefitting VetFran because he thought it would a fun way to build camaraderie for convention-goers at the No Limit Agency + SMB Franchise Advisors booth. The dunk tank was manned by No Limit staffers with guest appearances from clients, attendees and even some IFA team members. By the end of the convention, No Limit Agency and SMB Franchise Advisors had raised $1,085 for VetFran.


Franchising Gives Back at IFA’s 54th Annual Convention



At IFA’s 54th Annual Convention, more than 150 franchise industry leaders came together to volunteer at the third annual Franchising Gives Back service project.  On Friday afternoon, Franchising Gives Back participants traveled to the Einstein Charter School in New Orleans’ Ninth Ward where they built new planter boxes for the garden, new picnic tables and benches, painted exterior spaces, worked to clear a vacant lot, re-striped and repainted the playground blacktop and promised a donation of $4,500.

IFA’s Chairman of the Board and Managing Director of Roark Capital, Steve Romaniello, was a driving force behind the creation of Franchising Gives Back, along with Roark colleague Geoff Hill. “We tout franchising’s impact through advocacy, but the bigger impact franchising has is through our franchisors and franchisees working every day in their local communities,” said Romaniello. Geoff Hill expressed “This school is about giving opportunities, just like franchising, which is why bringing the two together is important.”

IFA was brought together with Einstein Charter School by Hands On New Orleans, which works to give volunteers a chance to help the Gulf Coast recover.  Hands On Executive Director Chris Cameron said “It is absolutely tremendous that IFA and franchising are helping Hands On and the school.  So many years after the storm it is easy for people to think that needs are being met, but they’re not.  Eastern New Orleans is forgotten.”

IFA members painted while the sounds of the Einstein band class playing “Do You Know What it Means to Miss New Orleans” floated over the blacktop.  A teacher walking through the playground was moved to say “This is wonderful.  Thank you all.  Thank you for making our school nice.”

Volunteers expressed their satisfaction in participating.  Mary Beth Brody of Faegre Baker Daniels said “IFA is a community and Franchising Gives Back lets us connect with that community and serve another that desperately needs it.”  Fishman Public Relations CEO, Brad Fishman said “Franchising has been good to many of us.  It is a fun day to give back and spend time with friends helping people”.

“It is obvious to us how franchising helps, but it is invigorating to go into communities where the Convention is and help in a different way” said Susan Bishop, Executive Vice President of Rainbow Station “There is also no better way to get to know each other than getting dirty together.”

In 2006 Einstein Charter School took over a failing elementary school.  Since that time, Einstein has been making continuous gains in student achievement and has been recognized by Louisiana as a “Top Gains School” for two consecutive years.  In 2013, for the first time, the school saw 100% of its 8th graders pass state assessment tests.  Einstein Charter’s CEO Shawn Toranto said “Einstein is deeply appreciative of franchising’s work to improve life here.  This is truly awesome.  When our kids grow up they will be volunteers just like these wonderful people.  Giving back is a civic responsibility.”

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