All abroad! - overseas franchising

Entrepreneur, April, 1996 by Lourdes Aguila

If you're thinking of franchising your business overseas, you're probably pondering questions like "What country is best for my franchise?" "Will my product sell overseas?" and "Who are my competitors?" The Arthur Andersen Center for Franchising can answer those questions and more.

"We've pulled together a team of professionals, such as lawyers and accountants, who understand franchising and have experience working with franchisors," says Leonard N. Swartz, worldwide managing director of franchise services.

Part of the Arthur Andersen Worldwide Organization, a network of independent professional firms, the centers assist franchisors expanding into foreign markets. They can provide financial advice, assist with market surveys, help adapt your franchise to a country's culture, help you search for investors to acquire a master franchise and more.

The first Arthur Andersen Center for Franchising was set up in Madrid in 1995 to take advantage of the relatively untapped Spanish market, where franchising accounts for only 2 percent of all retail trade. Since then, centers have opened in Singapore, the Philippines and Indonesia.

If you're targeting a country that doesn't have a center, Arthur Andersen provides what Swartz calls a "knowledge network." Using a computer database, the centers' consultants can access franchise-related information worldwide and transfer it to any of the 370 offices in the 73 countries where Arthur Andersen operates.

Arthur Andersen franchise center clients have ranged from small-business start-ups to multimillion-dollar corporations. For more information, call Leonard N. Swartz at (312) 931-1907 or Ellen Schlossberg at (312) 931-2667.

All Together Now

Franchising can be a lonely business. That's why the International Franchise Association (IFA) created 2nd Tuesday, a program that gives franchisors and franchisees the opportunity to mingle and share ideas at quarterly meetings across the country.

Created by Subway sandwich franchise founder Fred DeLuca, the meetings provide an informal atmosphere for discussing franchising issues, from diversity and grass-roots lobbying to financing options and legal trends.

Local IFA members host the meetings, held in 30 to 50 cities on the second Tuesday of each quarter. The IFA provides the theme for each meeting, such as how to do your own public relations.

Open to prospective as well as existing franchisees, franchisors and suppliers, the events offer a chance to meet franchising experts, share tips and information, and network with others in the business. For more information or for the 2nd Tuesday meeting nearest you, call (202) 628-8000.

Tokyo Calling

Is your franchise ready to enter the Japanese market? If the answer is yes, then mark your calendars for the Japan International Franchise Conference (JIFC), which will be held in Tokyo on July 22 and 23.

Sponsored by human resources firm Recruit Co. Ltd., the annual conference provides opportunities for U.S. franchisors, through informative workshops and one-on-one encounters, to meet with prospective Japanese investors and companies seeking new business opportunities. Recruit offers additional support following the conference by assisting with deal-making and franchise development.

"Japanese companies are restructuring," says Recruit's Toru Kikuchihara. "They must find new business opportunities, and former employees want to find new job opportunities."

Kikuchihara says last year's conference was a success, with 12 U.S. franchisors and 150 Japanese executives in attendance. At press time, the first deal to stem from that conference was expected to be signed in February, and a number of negotiations are still in the works.

The cost for U.S. franchisors to attend the two-day conference is $3,000. Since workshops are conducted in Japanese, an interpreter may be needed. Recruit provides interpreters for an additional $750. For more information, contact Recruit's U.S. subsidiary at (201) 216-3126.

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Hoagies and hot-cross buns? Doughnuts and deli sandwiches? Teaming two different fast-food concepts in one location makes for some strange bedfellows, but it also makes sense. The concept, dubbed dual-branding, helps franchisors draw in groups of diners with differing tastes and keeps sales steady morning, noon and night. (See "Seeing Double," October 1995.)

Small wonder that dual-branding is one of the hottest trends in franchising. A few new pairings:

Dunkin' Donuts and Baskin-Robbins, already dual-branding partners, hope to attract the lunch crowd, thanks to an agreement with Blimpie International. Blimpie submarine sandwich units will be added to 15 existing Dunkin' Donuts and/or Baskin Robbins locations nationwide.

Bakery retailer T.J. Cinnamons is working on a deal to provide Arby's with breakfast and snack products to complement its menu. Known for its fresh- baked cinnamon buns, T.J. Cinnamons is expected to be a particular boon to Arby's breakfast drive-thru business.

In February, Fuddruckers launched a test with La Salsa after Fuddruckers' parent company, Daka International, bought part ownership in the Mexican fast-food franchise. At press time, the company planned to retrofit four Southern California Fuddruckers locations with La Salsa units, then expand the test to some 20 units by spring.