West Coast Franchise Expo makes its move as the franchise industry continues to grow



With a view of Disneyland on the horizon, one of the leading franchise events in the west made its move to Anaheim California this year, for not only a change in location but a change in franchising possibilities.  The West Coast Franchise Expo made its official debut in Orange County October 12-14th and soon proved to be the perfect venue to further education and networking opportunities that people have come to expect from the expo.

The West Coast Expo, hosted by New Jersey based MFV Expositions; touted top executives who spoke about how even in recessionary times, their brands were able to stay afloat.  It provided a platform to discover viable business investments, and gave people exploring the idea of buying a franchise a one stop shop to learn from the best.

This year’s expo hosted a record number 8,763 visitors over the three days, 180 exhibitors showcased their new products and over 70 first time exhibitors, excited by the new location and market, made the move to the Anaheim after 8 years in Los Angeles.  This was no last minute decision, “the move to Anaheim came after considerable amount of market research and feedback,” explained Tom Portesy, President and CEO of MFV Expositions.  As the economy began to recover, Orange Country became the first metropolitan area in the state to post positive growth along with the lowest unemployment rate in Southern California, which had more franchisors eager to exhibit and expand.

The countless career opportunities created at the West Coast Expo is just one example of how franchising continues to bounce back from a slow, recovering economy.  “There is a wealth of job creation to be tapped in the franchise sector, and the franchise model continues to demonstrate its resiliency as a business sector,” states IFA President and CEO Steve Caldeira.  After almost three years of decline, the number of franchise establishments in the United States will increase by 1.5% in 2012 or nearly 11,000 new businesses, according to IFA’s third quarter update to its 2012 economic forecast prepared by HIS Global Insight for the International Franchise Association Educational Foundation.

Even with lingering uncertainties surrounding tax reform, healthcare and the lack of credit, “growth in the number of new franchise establishments, jobs and output are expected to outpace the overall economy” explains Caldeira.  The study projects the franchise industry will add 167, 000 new jobs to the economy this year.

With a move in location for The West Coast and International Expos this year, and a forecast that calls for growth, the franchise industry continues to attract new owners ready to start their own businesses.

IFA hosts tele-town hall to support members with the information needed to cast an informed ballot on Election Day



Last week, IFA held a tele-town hall, sponsored by Franchise Payments Network with the Romney for President campaign surrogate Former SBA Administrator Hector Barreto as part of the 2012 Franchising Votes campaign which intends to support our IFA members with the information they need to cast an informed ballot on Election Day. As part of the campaign, the IFA believes it is important to hear directly from each of the Presidential campaigns about what their Administration would do to support the franchise business community in the coming years.  (Please note, IFA is still actively working to schedule a town hall call with the Obama for America campaign over the next two weeks).

The call started with IFA President & CEO Steve Caldeira who noted that “This is truly a critical election. If you haven’t yet, I encourage you to visit www.FranchisingVotes.com for all of the tools and resources you might need.” The policies from either Administration moving forward will have a direct impact on franchise businesses in the years to come. It is critically important that we are all well-informed as we head to the voting booth.

Former SBA Administrator stated that Governor Romney understands that many small businesses are hurting and need policies and regulations to start and grow their businesses especially as it relates to tax policy. They believe that “Governor Romney’s five point plan will get business back on track and create millions of new jobs.” In addition, Barreto noted that the Governor will create the right environment for small business and knows the importance of championing job creators and creating more tax certainty so that business owners can have the tools to continue to create jobs.

As it relates to small business lending, Administrator Barreto said that Governor Romney understands that  small businesses are really struggling to get the loans needed to start and grow their businesses and a Romney Administration would reengage the lending community to help better ensure that business owners are getting the capital they need. Administrator Barreto noted Governor Romney’s first-hand experience in growing businesses and creating new jobs.

Finally, Governor Romney would act to repeal and replace the recent health care legislation on his first day in office with common sense solutions. Administrator Barreto said that “Obamacare is not the right solution for our country, our economy and definitely not for our small businesses.”  IFA actively opposed Obamacare, in particular, IFA opposes the employer mandate in the legislation which could put 3.2 million franchise jobs at risk.

For the full recording of the tele-town hall call please go to: http://emarket.franchise.org/RomneyConferenceRecording.wav

Uncertainty Stalls Hotel Developer

From Free Enterprise

Tom Torgerson (right) says that his hotel and restaurant development company will start “winding down” if the administration gets another term to pursue its tax and regulatory agenda.

Like everyone else in the country, Tom Torgerson is keeping a sharp eye on the upcoming elections, and the results will have ramifications for him as well as his company far beyond Election Day.

“The outcome of these elections will have a dramatic impact on the rate of our future development,” says the 54-year-old CEO and chairman of Torgerson Properties Inc.

Torgerson Properties, which operates 28 hotels and 9 restaurants, has $75 million in new projects planned in 2013 and 2014, including at least 4 new hotels and 3 franchised restaurants, for a total of 660 new jobs added to the Minnesota economy.

However, Torgerson says that he’s prepared to walk away from those projects—and take a financial hit—if he doesn’t feel that the environment after the elections is conducive to expanding his business.

“Right now, we’ve got the most development deals teed up that we’ve ever had in the company’s history,” Torgerson says. “And they are structured in a way that there are some costs if we don’t proceed. I’ve got some good years left in me and enjoy what we do, so I’m willing to take a gamble. If the right things happen, we can go forward.”

His concerns about the future and the policies advocated by the current administration—particularly on taxes and regulations—are causing him to delay his expansion plans.

Torgerson Properties is organized as a pass-through entity, which means that business profits are taxed at the individual tax rate.

President Obama has suggested letting the 2001 and 2003 tax rates expire, in which case successful business owners like Torgerson will face a marginal rate as high as 39.6%, which when combined with state and local taxes, will impose almost a 45% top marginal rate on income. This is greater than in any other industrialized country. In addition, because of the new health care law, beginning in 2013, the Medicare tax will increase from 2.9% to 3.8% for those making more than $200,000.

“I’m certainly open to a tax system overhaul,” Torgerson says, adding that he could tolerate his taxes going up some if the size of government was reduced and the tax code was simplified and streamlined.

Torgerson believes that the business community is poised to start investing again if and when Washington makes the right decisions. “My belief is that there is a major eruption of optimism in the business environment waiting to happen. That’s why I’m teeing up these projects. If our country gets back on track, there’s a huge opportunity, and I’m trying to position our company to take advantage of that if that happens.”

But if the administration gets another four years and continues pursuing the same tax and regulatory policies, “it’s time for me to start winding down,” the 30-year business veteran says.

From Free Enterprise

Jimmy John’s CEO: Obamacare forces us to raise costs



Ahead of a very important debate tonight for Democrats and Republicans, Jimmy John Liautaud, founder and CEO of Jimmy John’s Gourmet Sandwich Company, stopped by Neil Cavuto last night to explain that even though his company has thrived under Democratic and Republican Presidents, they are beginning to hold back on current expansions.  “About 80 percent of our growth has come from existing franchisees, but what is happening right now is a lot of franchisees are holding back because they are unsure what will happen with the future of Obamacare,” explains Liautaud.

Jimmy John’s, which employs about 60,000 hourly workers, states that they will have to cut back the hours of those workers because there is no other way they will be able to survive. To view the full interview on FOX News click here.

Small business confidence falls as people begin to cut back on everyday purchases



Consumers are known to begin cutting back on big purchases like dining at high end restaurants or on vacations when the economy is sluggish and concern for job certainty is high. But are people now starting to cut back on dining at fast food establishments?   IFA chairman and Arby’s Chairman of the Board Jon Luther discusses the impact the uncertainty is having on fast food restaurants and the franchise industry during a special segment with FOX News’ Neil Cavuto.

Being a part of Arby’s and Dunkin’ Brands, Luther explains that, “we are at the crossroads of consumers and franchisees and we have to weigh their view points and understand their behavior. Early this summer we saw a real slow down overall in the industry, whether it be the franchise or the general restaurant industry,” states Luther.  “People are retrenching and eating out less and generally cutting back on over all purchases and food has become one of them. “

In the franchise world, there are franchisees who are small business owners being affected by consumer slowdown and the uncertainty.  The franchise industry has direct and indirect jobs of 18 million jobs in this country and over 825,000 establishments that are franchised.  “These small business owners can make a huge contribution to our economy and until there are jobs and certainty in the consumer and business environment we are going to be seeing this pattern for a while,” explains Luther.

However, the consumer still has to eat and even with the cut backs Luther assures that “everybody is working hard every day to make sure we provide value to the customers.”

Click here to view the full interview on FOX News.

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