SOME EXAMPLES OF WHY FRANCHISING IS SUCH A POWERFUL MARKETING SYSTEM – WAY OF DOING BUSINESS --
Starting a Franchise | IFA | Doing Business 2.0
Introduction to Franchising John Reynolds, CFEPresident, IFA Educational Foundation
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.
International Franchise Association Based in Washington, D.C. $14 million annual budget 30 Members - Professional StaffGovernment Relations, Conferences, Media Relations, Membership, Marketing, and Administration
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)
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
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
FDD HighlightsExperience of franchise managementBankruptcy and litigation historyInitial and ongoing feesTerritory rights (if any are granted)Contact list of current and former franchiseesSupply and sourcing arrangements (if any required)Franchise Agreement you will be required to sign
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.
Start Small Finish BigBy Fred DeLuca & John Hayes15 Key Lessons to Start – and Run –Your Own Successful Business
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.
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
For more information: John Reynoldsjreynolds@franchise.org IFA website: www.franchise.org