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Starting a Franchise | IFA | Doing Business 2.0


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The International Franchise Association presented at the Washington, DC Economic Partnership's Doing Business 2.0 seminar on Franchising (3/13/13).

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Starting a Franchise | IFA | Doing Business 2.0

  1. 1. Introduction to Franchising John Reynolds, CFEPresident, IFA Educational Foundation
  2. 2. International Franchise Association• Founded in 1960, IFA is the worlds oldest and largest organization representing franchising worldwide.• IFA’s Mission: to protect, enhance and promote franchising.• IFA members include franchise companies in over 300 different business sectors, individual franchisees, and businesses that provide products and services to the industry such as marketing, law, and business development.
  3. 3. International Franchise Association Based in Washington, D.C. $14 million annual budget 30 Members - Professional StaffGovernment Relations, Conferences, Media Relations, Membership, Marketing, and Administration
  4. 4. IFA Website –
  5. 5. The U.S. Franchise Industry• Job Creators – Nearly 18 million jobs • 1 out of every 12 private sector jobs • $304.2 billion in payroll (direct) (2007 Economic Census.)
  6. 6. Franchises in Job Creation
  7. 7. The U.S. Franchise Industry• Revenue Generators – $2.1 trillion in economic output • $802 billion in direct output/ 9 percent of total economic output • 3.9 percent of all private sector GDP (direct)/ 9 percent of total • 3.4 percent of all GDP (including government & farm sector)
  8. 8. American Franchising Video
  9. 9. What is Franchising?A marketing method in which the owner of a product or service, known as the“franchisor”, offers the right to operate and manage his product & service toothers, the “franchisees”, in return for a fee and ongoing royalty payments. Franchisor Franchisee - Know-How - Support - Initial Fee - Royalty, - Trademark - Infrastructure
  10. 10. How To Investigate A Franchise Conduct market research Evaluate strength of franchisor Call existing and former franchisees Hire a lawyer or accountant familiar withfranchising Read the Franchise Disclosure Document, orFDD – thoroughly Check the FDD for earnings claims or financialperformance estimates
  11. 11. FDD HighlightsExperience of franchise managementBankruptcy and litigation historyInitial and ongoing feesTerritory rights (if any are granted)Contact list of current and former franchiseesSupply and sourcing arrangements (if any required)Franchise Agreement you will be required to sign
  12. 12. Fred DeLuca – worked in the firstSubway restaurant in 1965to earn money to go to college.Now he and his franchise partnersown more than 36,000 restaurantsin 85 countries.
  13. 13. Start Small Finish BigBy Fred DeLuca & John Hayes15 Key Lessons to Start – and Run –Your Own Successful Business
  14. 14. Two Men And A Truck – 1985 to 2012Started by two brothers inhigh school with $350 and one truck,now 200+ locations across the U.S.and development rights in a numberof foreign countries.
  15. 15. Started business in 1950 selling coffee and donuts off the back of a catering truck in factory parking lots. Now more than 9,000 locations world-wide.Bill Rosenberg, founder of Dunkin’ Donuts, with hisbook Time To Make The Donuts
  16. 16. For more information: John IFA website: