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Dairy Queen Heads Back to Europe with Polish Expansion


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Warren Buffett's Dairy Queen announced this week that it is opening a total of 26 new locations in Poland, the company's first European presence in more than 20 years. 

The first Polish DQ Grill & Chill and DQ Treat stores are expected to open this spring in the greater Warsaw metro region. Beyond food, the locations will also offer the frozen dairy soft-serve treats, such as the Blizzard, cones with the curl on top and sundaes. 

“This move is strategic. We are entering the Eastern European market at a time when Western brands are being embraced by a consumer base that is well informed on the importance of global brands,” said Jean Champagne, chief operations officer—international groups. “We look forward to working with a strong franchise partner in Poland. We see this as a launching pad for other contiguous countries in the region.”

While it's common to hear of American brands expanding to all corners of the world, there have been a lot of companies recently expanding to Asia and the Middle East—so DQ's Poland announcement was a bit of a surprise. With turmoil in neighboring Ukraine overshadowing American attention in this part of the world, I did some quick research to see why Dairy Queen is looking to do business in the land of sausages and pierogis.

Let's start with the basics. The Republic of Poland is an ancient former kingdom bordered by Germany and Czech Republic to the west, Slovakia to the south, and Ukraine, Belarus and Lithuania to the east. The population is approximately 38 million, making it the eighth-largest in the European Union. 

The country joined the North Atlantic Treaty Organization (NATO) in 1999 and, according to the CIA World Factbook, it was one of the only EU nations to avoid a recession during the 2008-09 global economic downturn. That said, its GDP per capita is significantly below the EU average, and unemployment (10.3% in '13) is also above the regional average. 

Sluggish (at best) growth in the Euro zone has dulled recent growth, although the country is poised for future expansion with potential improvements in its transportation system, business climate and government red tape. 

Its GDP as of 2013 was $814 billion, the 22nd highest in the world, with 1.3 percent growth that year. Per capita, its GDP is $21,100, which is the 69th highest in the world. Services is the country's largest sector, with a solid industrial base providing exactly one third of the country's annual GDP. 

Compared to many developed nations, Poland's public debt is less than 50 percent of its annual GDP, inflation is around 1 percent, and the country exports approximately $200 billion worth of goods a year, primarily to Germany (26%), the UK (7%), the Czech Republic (6.5%), France (6%) and Russia (5.2%). 

Last but not least, did you know that the symbol for Warsaw is a mermaid? Apparently a fisherman rescued Warsaw's mermaid, so she declared her willingness to protect the city and its residents. #themoreyouknow

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The latest news, opinions and commentary on what's happening in the franchise arena that could affect your business.

Laura MichaelsLaura Michaels is editor of Franchise Times. She can be reached at 612.767.3210, or send story ideas to lmichaels@franchisetimes.com.
 
Beth EwenBeth Ewen is senior editor of Franchise Times. She can be reached at 612.767.3212, or send story ideas to bewen@franchisetimes.com.
 
Nicholas UptonNicholas Upton is restaurants editor at Franchise Times. He can be reached at 612.767.3226, or send story ideas to nupton@franchisetimes.com.
 
Mary Jo LarsonMary Jo Larson is the publisher of Franchise Times Magazine and the Restaurant Finance Monitor.  You can find her on Twitter at
 twitter.com/mlarson1011.
 

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