Trip across the pond reveals healthy business model, inspiring stories
Editor’s note: Phil Zeidman is turning over his column this month to his DLA Piper colleague Rich Greenstein, who had a bird’s-eye view at the British Franchise Association’s symposium.
I was excited as I stepped to the registration desk at the British Franchise Association’s International Symposium on Franchising in March. The symposium was intended to give attendees a tutorial on global expansion by franchise companies, and in particular, the variety of factors a franchisor must consider when expanding beyond its current country of operation.
In reality, however, it was more than just a tutorial; the symposium was an enthusiastic celebration of the franchise business model. The event welcomed 125 attendees, ranging from members of franchise associations throughout the world, owners and operators of franchise companies and all types of service providers to franchise clients.
But everyone had something in common; a firm belief that franchising is alive and well, and, more than ever, a global method of doing business.
It would be hard to declare the symposium anything other than a huge success. Led by the ever upbeat, one-person franchise cheerleading squad Brian Smart, the director of Europe, International of the British Franchise Association, the symposium offered a panoply of speakers providing advice concerning global expansion.
The panel discussions and interactive sessions concerned topics such as how to enter the United States, United Kingdom and Europe markets, recent legal developments around the world, market selection and analysis, financing your franchise, master franchising, and alternative dispute resolutions.
Also available were interactive roundtables that offered attendees the opportunity to listen to, and question, leading experts on their experiences and best practices in far-ranging practical, real world subjects franchise owners and operators face each day.
These subjects included territory mapping, ongoing franchise support, leasing, franchise exhibitions to recruit franchises, training yourself or using an external provider, managing franchise resells, recruiting through social media and analyzing and selecting international markets.
The roundtable format has become a staple of both legal and business franchise symposia in the United States, because of its more casual nature that fosters a free flow of information and opinions for the benefit of all participants.
Never say never
Two programs that deserve highlighting (and personal favorites of mine) were the keynote address by Paul Thompson and the real-life stories segment with a panel of experts who have experienced great success expanding their brands across parts of the globe. Paul Thompson’s captivating speech and the global expansion of his company, Water Babies, was applauded by all.
Founded in 2002 in Devon, England, Water Babies has grown to a strikingly successful company with dedicated employees and an ever-growing franchise network. Thompson’s passionate story about his company’s decision to franchise in China despite vowing for years never to do so, was an excellent primer for franchisors to “never say never.”
But he also emphasized the need to proceed with caution when exploring global expansion and remembering to select the right franchisees and franchise structure (in his case, using master franchisees). It was clear why Water Babies was selected as the 2016 Franchisor of the Year by the British Franchise Association.
The real-life stories of global expansion were delivered by Ned Lyerly, president-international of CKE Restaurants, Jerome Lassara, owner of Accor Hotels, and Richard Chatham, international support officer, Tax Assist Accountants. Each discussed their strategies for expansion of their brands, the challenges they faced and why they thought they had been successful.
Everybody wants in
On a personal note, another highlight was the opportunity to partner with Adam Thompson, managing director UK and Europe for InXpress, in leading one of the interactive sessions concerning “How to enter the United States market.” At the well-attended session, we provided the attendees with a mix of information, both legal and business-related, regarding the U.S. market. Best of all, we were peppered with questions throughout the session.
To no one’s surprise, the United States remains the one market most foreign-based franchisors desire to enter, despite the fear of the high cost of entry, heavy regulatory oversight and the daunting size of the potential market. Second, foreign franchisors appear to be more strategic than ever in how, when and where they enter the United States market.
Finally, foreign franchisors know they can’t do it alone and are willing to spend their capital resources for the right advisers. All in all, the lasting impression is that franchisors are more interested in the U.S. market than ever, but also more realistic about what it entails.
Philip Zeidman is a partner in DLA Piper’s Washington, D.C., office. Reach him at 202.799.4272 or email@example.com. Atlanta-based Rich Greenstein leads DLA Piper’s franchise practice. Reach him at firstname.lastname@example.org.