Chile Keeps Warming to U.S. Franchising

 

 

Santiago, Chile sits near the meeting of the Nazca and South American tectonic plates, vast slabs of the Earth’s surface that grind past each other at a rate of about three inches a year, sometimes causing earthquakes and tremors.

But what shook up this prosperous, stable nation last week was a U.S. Franchise Trade Mission, which brought 25 U.S. brands to a country with the highest per capita income in South America and a growing, diversifying economy.

Tony Valles, Vice President of Business and Concept Development for McAllister’s Deli, believes the country is more than ready for a franchise boom. “We came on the trade mission because we’re getting steady interest from Latin America. In the past, we took a more opportunistic approach. Given the potential of these markets, we want to take a more strategic approach,” he said.

The interest in McAllister’s dovetails with growth in the Hispanic market in the U.S. “The big operators are interested in our brand,” he said. “With a little tweak in the menu, we think our product will work very well in Latin America.”

Home Instead Senior Care President Jeff Huber jetted in to join Senior Vice President and Chief Operating Officer of Global Operations Yoshino Nakajima for a back-to-back set of meetings in Santiago.

Huber majored in English literature and also earned a law degree from Jesuit-run Creighton University in Omaha, Neb. before clerking for a federal judge and practicing law on the way to Home Instead, where he became President and COO two years ago. “For me, it’s about being of service,” he said. “We provide very personal care to vulnerable people in the sanctity of their homes. You need a high level of commitment and passion to do that well.”

As such, Home Instead looks for a special kind of business partner. But that hasn’t hampered international growth: The brand operates about 1000 units in 16 countries, so far.

With a well-educated population of 17 million, Chile has attracted other top U.S. firms, including Wal-Mart, Turner Broadcasting, Oracle, Equifax and MetLife in addition to the largest U.S. franchise brands.

Growing at about five percent per annum, it has the highest per capita income in South America – equivalent to Russia and Malaysia. And if the natural beauty, mineral wealth and educated populace don’t impress, hear this: Chile’s debt-to-GDP ratio is 10 percent – compared to 100 percent in the U.S.

…Now, back to positive thoughts.

By 2016 all tariffs on U.S. goods in Chile will be phased out, thanks to a 2004 bilateral trade agreement, further improving the attractiveness of U.S. products. Seventeen percent of Chile’s imports already come from the U.S. – with import growth surging each year overall.

Ray Hays of Edwards Global Services said his clients, BrightStar Care and Sport Clips, Inc., will benefit from the growth in Latin America. “In the case of BrightStar, it’s pretty clear where they fit. It’s the type of brand that is attractive and needed,” Hays said, adding, “It’s important for a master franchisee to know the regulatory and medical sector in the country.”

About Sport Clips, Inc., “People see it and they just get it,” he said. “The response has been, ‘This is something we could really use here.’ They have very few options for men’s hair care. The barber trade is disappearing. The franchise is able to offer more for a similar price and dominate the market.”

While Hays said due diligence and follow-up are necessary to further qualify potential franchise partners in Latin America, the trade mission fostered a series of high-quality meetings set up by the U.S. Commercial Service team led by Veronica Pinto in Santiago.

“The 2012 International Franchise trade mission to South America exceeded Global Franchise Group’s expectations in every way,” said  Chief Development Officer John Barber, joined by Santiago-based international franchise consultant and former IFA executive Marcel Portmann on the trade mission. “We could never have scheduled this productive a trip without the help and support of the U.S. Commercial Service, the International Franchise Association (IFA), and Franchise Times.”

“For anyone still thinking that South America is a future possibility for franchising, I encourage them to rethink their position,” said Don Burleson, Executive Vice President of Jani-King, “because the opportunity exists now.”

IFA attends both RNC and DNC Conventions to highlight the role franchising plays in the economy

 

 

As Governor Romney mentioned last week in Tampa, this country needs jobs, jobs, jobs…and lots of them. Fortunately, we have lots of jobs in franchising—nearly 18 million to be exact. As IFA attended both RNC and DNC Conventions in Tampa and Charlotte the past two weeks, we hosted events to highlight the role franchising plays in the economy, speaking with members of the media and mingling with lawmakers and candidates to discuss IFA’s Franchise Jobs agenda.

Below is a photo gallery of some of those activities and links to some of the media placements the industry has received due to its presence in Tampa and Charlotte.

U.S. Franchising Blooms in Bogota

 

 

Bogota, the stylish capital of this stunning Latin American country, is perched 8,000 feet above sea level, at a much greater elevation than mile-high Denver or the highest peak in Africa, Mt. Kilimanjaro. According to reports from the U.S. Franchise Trade Mission to Latin America, Bogota’s altitude may hint at the heights U.S. franchising can reach in this booming country of more than 46 million.

RadioShack made national news during the trade mission co-hosted by the International Franchise Association, the U.S. Commercial Service, and Franchise Times in late August with a ribbon-cutting at its first store in Colombia. It didn’t hurt that the Deputy Chief of Mission at the U.S. Embassy here, Perry Holloway, wore the RadioShack uniform as a store employee early in his career and continues to be a fan. “Can we look around the store?” he asked, waving off reporters and other officials during the visit as his eyes crawled over walls of gadgets and electronic gear.

RadioShack, now operating in 31 countries with development underway in a total of 40, has ambitious plans, including being the world’s number-one battery retailer.

“Wherever a battery is sold, we’d like it to be a RadioShack battery,” said Marty Amschler, Vice President of Global Franchise for the company. “Batteries are universal, like many of our products,” Amschler adds. He and his partner Benjamin Simon, Senior Director of International Development, have spearheaded global development for the electronics powerhouse, establishing a significant footprint and revenue streams at a feverish pace. But, please, don’t call either one an Energizer bunny.

The trade mission got an extra charge from Nicole DeSilvis, Commercial Attaché at the U.S. Embassy in Bogota, whose thousand-watt smile led the 25 brands, all IFA members, into the tony El Nogal Country Club – 12 stories of luxurious meeting rooms, restaurants, an Olympic-size indoor swimming pool, world-class fitness facilities and an art gallery.

Ambassador Michael McKinley, juggling calls from his cel phone as reports of renewed peace talks with the rebel group FARC presented a possible breakthrough on a long-running challenge in the country, pivoted from the political to endorse the franchise trade mission. “There is a revolution in retail in Colombia,” he said. “You will find business partners who are willing and able, and you will continue to have our full support.”

Despite challenges like security and lingering poverty, Colombia is the fourth-largest oil producer and the number-one coffee producer in Latin America, with an economy that expanded by 7.7 percent in the third quarter of 2011, projecting growth of nearly six percent this year.

In the El Nogal Club, the fruits of the expanding economy could be seen, with Hermès ties almost standard and a suit-and-tie-only dress code reflecting Colombia’s formal business culture.

Bogota was a big hit for FOCUS Brands, whose Latin America development will now be spearheaded by Keith Carleton, Director of International Business Development. Scott Chorna continues in a similar role focused on Asia, the Middle East and Africa. “We’ve been pleasantly surprised not only by the number of appointments but the quality of the prospects,” Carleton said.

Cinnabon and Auntie Anne’s are already established on the continent, as they are around the world. The pretzel “is a blank canvas,” Carleton says, “so regionally, you can adapt it with sugar, “dulce de leche,” (caramel in Spanish) and other local flavors. In Asia, he says, a dried seaweed topping is sometimes used in place of salt.

“We need to protect the heritage and consistency of the brand, but we recognize that customers may prefer other flavors and other sizes, and we encourage that,” Carleton said.

Whereas Moe’s Southwest Grill is a more complicated concept with larger start-up costs, Carleton points out a similar Latin American concept call Tommy Beans that is fairly well established. The competition doesn’t worry him. “We can point out that our quality and our brand representation are superior,” he said.

Popeyes Louisiana Kitchen’s Tim Waddell feels similarly about a local brand offering fried chicken in Colombia. “We think Frisby really needs some competition,” Waddell said, referring to a chain with 100 restaurants in 24 Colombian cities.

The Commercial Attaché agreed. “No question about it,” said DeSilvis, a cheerleader for U.S. franchising in Colombia, who just extended  her tour of duty in the country.

The hunger for U.S. food brands is so strong that Hair Parra of WingZone signed a master franchise agreement for the country before the trade mission ever touched down in Bogota. Investors contacted Parra, an owner of the company, after reading about the trade mission and calling U.S. Embassy officials.

“The groups we’ve seen have been very good,” Parra said. He estimated that 90 percent of the candidates interviewed in Colombia were qualified.

“We are so pleased with the overall resounding success of the franchise trade mission as the key objectives were met,” said DeSilvis. “The excitement in U.S. franchising that this mission has stirred has been exceptional and we look forward to riding this wave as far as it will take us.  Franchising is on the tip of everyone’s tongues right now and the U.S. Commercial Service, IFA and Franchise Times are proud to have spurred this flurry of interest in the South American market.”

Download IFA’s Franchising Votes Mobile App today!

 

 

Just in time for the IFA 2012 Public Affairs conference we are pleased to announce our new mobile app called “Franchising Votes”. It’s currently available in both the iTunes App Store and the Google Android Marketplace.

Watch a short video demonstrating the app:


This app allow you to:

  • See the schedule of events for the conference,
  • Review talking points for your visits with legislators
  • Watch our videos
  • Browse Congressional directories, and
  • Submit feedback from your meetings on Capitol Hill

What’s really great about this app is that you can connect to your own social media profiles on Facebook, Twitter, Foursquare and share the good work you are doing in Washington with your friends and followers back home. Using Franchising Votes you can:

  • Send tweets and status updates
  • Upload photos and videos, and
  • Check-in at our events.

All of these activities will be tagged with our social media hashtag #FranchiseJobs, which will amplify our activities in DC back in your hometowns and Congressional Districts.

Please take a minute and download the free app today. Just search for “Franchising Votes” in the app store. Thanks for all that you do to support the International Franchising Association.

Thank you to our mobile app sponsor MSA Worldwide.

Like father like son: IFA’s Annual Convention introduces the next generation to franchising

 

 

Finding a job can be a big challenge for recent college graduates, 53.6% of American bachelor’s degree holders under the age of twenty-five were jobless or underemployed last year according to a recent Associated Press report. Rather than wait for the economy to recover, some families are taking charge of the situation by helping their young grads start careers as franchisees.

Recent college graduate Mike Neumayr and his father Ed attended the International Franchise Association’s Annual Convention in February and happened to meet Nick Friedman, co-owner of College Hunks Hauling Junk.  While learning more about the company, Ed and Mike realized learned about an opportunity to take over a franchise location in Tempe, Arizona.  A moving company that focuses on teamwork and customer service sounded like a perfect business opportunity for Mike.

Father Ed is not new to franchising — he owns a Great Clips franchise in Ahwatukee Foothills, Arizona– so he knows that “finding the right franchise that matches your skills is important for success.”  After conducting his own research about the company, Ed decided to purchase the Tempe location with the plan to pass the store on to his son after Mike worked in the business for a while.

The Neumayrs took over the franchise earlier this month and already have bigger plans for the future.  They’d like to launch an internship program, teaching college student’s business skills before they graduate.

College Hunks Hauling Junk started with college buddies in Florida moving and hauling junk for people in the neighborhood.  Today it’s a national company and one of the largest employers of college students across the country, as well as being a leader in IFA’s VetFran Operation Enduring Opportunity campaign.

To register for IFA’s 2013 Convention and create your own franchise opportunities please click here!

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