Going global is a big step so how do you know you’re ready? Follow the steps in this checklist from Bill Edwards of Edwards Global Services before you take the plunge into international waters.

1. Take the long view.
Going international should be a strategic decision. Senior management must be willing to build a solid foundation for a successful international business on an ongoing basis, not just to make a couple of deals for the initial fees.

2. Start with a plan.
Establish a business plan with achievable goals and a realistic budget for international development. Don’t jump on leads until your plan is in place.

3. Protect your brand.
Apply for trademarks early—before you start to market in a country. And don’t ever let a candidate do it for you!

4. Clearly define your market and competitive advantage.
Candidates must be convinced that your business can compete in their marketplace with a new and different concept. The better you know the new market, the better your negotiating position with potential partners.

5. Establish a good track record at home.
Viable international candidates will do their own due diligence. If they don’t want to know how your business is doing and has done in your home country, they’re not good candidates.

6. Have a documented system for each country.
Your training, support and marketing programs must be based on a business model that can be transferred to another country and culture.

7. Set up an Intranet.
It’s the most cost-effective way to manage your organization and provide international training and support. And it’s accessible 24/7 in any time zone.

8. Be ready to monitor and enforce your business systems.
Get system standards and reporting processes in place and follow through just like you do at home.

9. Do your due diligence.
You must know who you are dealing with to avoid unpleasant surprises in the future. There are services available to help you find all the details you need.

10. Borrow some experience.
Experienced target country advisors could help you minimize mistakes in market entry. They can also help conduct due diligence.

International Franchising-It's Hot, Hot, Hot

Want to know where the action is? Look overseas, says Bill Edwards, CEO of Edwards Global Services. He should know. These days Edwards is a very busy man, helping clients expand into profitable international markets.

“It’s bargain basement day,” says Edwards, “for foreign companies to buy U.S. licenses. It’s because of the dollar. We’re incredibly busy because so many companies from other countries with better currency exchange rates than in the past are buying while they can. Imagine you’re an American franchise with a license for sale in another country and you’re asking an initial fee of $250,000. A year ago that would have taken 208,000 Euros, today it takes 155,000.”

Edwards says things may be tough here in the U.S., but it’s a different story overseas. “There’s been a slowdown in unit franchise sales in the U.S. partially because of the credit crisis. Every franchise we talk to tells us that they’re having more difficulty finding unit franchisees than they were a year ago. But there are economies in Europe and Asia that are just booming.”

Where exactly are these booming markets? Edwards says China tops the list. “When the Chinese changed the franchise laws last September, it made it easier for foreign franchises to enter the country. So we’re seeing a great growth in China. There’s also a lot in Malaysia and Viet Nam is a hot market right now. In Europe, look at Greece, Spain, and Scandinavia. And then South Africa and Brazil. Except for South Africa, these are all countries with fairly good exchange rate differences with us as opposed to last year.”

The U.S. economy is suffering, but Edwards says U.S. brands are still number one. “We have no difficulty finding companies all around the world, including the Middle East, that want US brands. No difficulty whatsoever. They want U.S. brands. And this is no exaggeration—we are really the best in the world at business systems.”

When you think of franchises in other countries, you might conjure up visions of golden arches in China and Russia. But Edwards says that’s not what’s hot. “The place we see the most interest today is in service franchises, specifically anything that has to do with personal services, whether it’s home or personal. It’s big. The majority of our clients are service concepts these days.”

Edwards points out that what the license fee is buying is simply a system. “They’re buying the manual, the training, the support, the marketing, the business systems. They’re not buying tools, they’re not buying widgets, they’re buying systems. And we’re seeing a tremendous interest in that around the world.”

What’s the one thing franchisors need to know most about going global today? “That going global is not a source of short term initial license fees,” says Edwards. “It needs to be a strategic direction for the company because the initial fees have associated costs over time—otherwise known as training, support, and travel. Going international is not for someone who needs some quick cash.”

Contact information:
William Edwards, CEO, Edwards Global Services
949-224-3896
www.edwardsglobal.com

Don't make excuses - selling in today's Franchise environment!

By: Mario Altiery

A craftsman never blames his tools. But when it comes to selling franchise units, both mature and start-up franchises are falsely blaming the “junk” quality of portal and web-based leads for poor numbers. There is healthy growth in all segments of franchising. The change we are seeing is that we are fat cat franchisers who want something for nothing and are making excuses for our own flawed sales process.

Here are key steps that need to be worked through with every sales lead, regardless of its origin. As you read them, evaluate your sales team’s performance: is it on its way to making more sales—or more excuses?

Master list—Develop a master list of leads to call and use it for prospecting.

Speed to lead—Respond to prospects by calling within hours—no matter what.

Move in, or move out—There’s no such thing as a “pending lead.” A prospect is either moving forward in the process or moving out. If it’s bad timing for the buyer, keep them on the list and make monthly contact.

Timely calling, follow-up—Follow-up should be customized phone conversations, emails and phone messages so that each prospect is worked according to a system.

It’s a numbers game—If you don’t have a legitimate reason for calling a prospect again and again, make one. Call and email at least five times before a prospect is put on a “dead sheet.”

Be a robot—Free forming doesn’t work. Use the same script every time, but deliver it like it’s the first time.

Know your industry—Make sure you and your sales team know about the intricacies of the franchising industry.

Mario Altiery is President and CEO of Upside Group, an award-winning franchise marketing consulting group www.upsidegroup.biz. Mario can be reached at mario@upsidegroup.biz or 480-219-2395.

Hotels Head to Middle East and Asia

The U.S. hotel industry is looking to the Middle East and Asia for growth as the domestic economy slows down. Company executives told an annual New York University hospitality conference this month that Eastern markets offered huge opportunities just as weaker consumer spending, troubled airlines and sky-high gas prices might threaten their domestic businesses. Hotels are expected to spring up at a fast pace in the Middle East, India and China during the next few years.
The promise of the East contrasts sharply to the problems that many expect for hotels in the United States. In April, leading U.S. hotel operators Marriott International Inc and Starwood Hotels & Resorts Worldwide Inc reported lower quarterly profits as the slowing economy hurt travel spending. All this gives U.S. hotel company executives good reason to target the Middle East and Asia for opportunities, industry executives said. (Reuters, 6/4/08)

Casual Chains Cut Portions and Prices

Richard Snead, T.G.I. Friday’s president and chief executive, recalls that people in the industry thought the restaurant was making a big mistake when the chain began offering smaller portions at lower prices a year ago. This May, however, Snead declared that the chain’s “Right Portion, Right Price” platform has been wildly successful, and he said it now is a permanent fixture on the menu of the more than 600 U.S. locations of T.G.I. Friday’s. Other casual-dining players also have begun offering smaller-portioned, lower-priced menu items, including The Cheesecake Factory, Mimi’s Cafe, and the Southern California chain Lucille’s Smokehouse Bar-B-Que. Industry analysts expect the trend to grow.

With consumers now keeping tight grips on their wallets, casual-dining operators see smaller portions at lower prices as a way to maintain profitability on each plate while preventing greater numbers of regular customers from trading down to fast-casual and quick-service alternatives. T.G.I. Friday’s “Right Portion, Right Price” initiative has resulted in an increase in the chain’s average check because guests tend to order more appetizers and dessert, officials said. Over the past year, up to 15 percent of sales per month have been attributed to the Right-sized items. (Nation’s Restaurant News, 5/16/08)

Franchise Brands Buys HomeVestors

Franchise Brands LLC has bought majority ownership of HomeVestors of America Inc., the company behind the "We Buy Ugly Houses" billboards. Terms of the deal were not disclosed. Founded in 1989, Dallas-based HomeVestors sold its first franchise in 1996 and has grown to a national franchise that specializes in buying homes that need repair. HomeVestors' network includes more than 230 franchised offices in 35 states. The company said its franchisees sell most of the houses to other investors and first-time home buyers

In 2007, Milford, Conn.-based Franchise Brands, which owns several other franchise companies, invested several million dollars in HomeVestors' operations. HomeVestors said Franchise Brands continued to watch the company's development and recently decided to commit additional financial resources to help HomeVestors continue its franchise expansion and develop its business model. Franchise Brands was formed in 2005 with support from the founders of Subway restaurants. The company provides investment capital to companies in a number of industries, including food and beverage, retail, consumer products and business services. (American City Business Journal, 6/10/08)

Krispy Kreme Posts Profit

Krispy Kreme Doughnuts Inc. posted net income of $4 million for the first quarter ended May 4 as the chain continued to shift its operations overseas. The profit of 6 cents per share compares with a loss of $7.4 million, or 12 cents a share, for the year-ago quarter, when the doughnut company took a charge of $9.6 million for debt refinancing. Revenues for the quarter were $103.6 million, a decline of 6.6 percent from the comparable quarter of the prior fiscal year. Same-store sales slipped 3.9 percent systemwide, but rose 1.2 percent at company units, according to the company, which franchises or operates 470 Krispy Kreme doughnut shops. The chain ended the quarter with 27 more international stores and six fewer domestic units. Half of the system now operates outside of the United States and about three out of four stores systemwide are franchised. (Nation’s Restaurant News, 6/9/08)



Hilton Expands Hotels in UK and Turkey

International leisure group Hilton Hotels Corporation will this week unveil two of its biggest development deals since being acquired last year. The tie-ups will see 30 more of its budget Hampton Inn hotels opened in Britain and 25 new mid-market Hilton Garden Inns across Turkey. The total cost of the new properties is likely to reach $1 billion (£ 508m). Hilton has agreed to a management deal with HLH, a property company specializing in the hotel sector, to open the UK sites. HLH will build and own the properties while Hilton will get a contract to run them.
A similar partnership will operate in Turkey, where developer Kosifler Group will finance the new hotels and Hilton will run them. Turkey is regarded as a key growth market for Hilton, along with a number of other countries, including Britain and Ireland, Spain, Italy, Russia, China and India. Blackstone, the US investment firm that bought Hilton last year, set a goal of opening 1,000 hotels. It operates about 250 sites outside of the Americas. In part, the target will be achieved by Hilton moving some of its brands such as Hampton Inn and Doubletree out of the US for the first time. (Hotels Magazine, 6/9/08)


Maui Wowi to Franchise in UAE

Maui Wowi Hawaiian, a franchise which offers natural Hawaiian products and smoothies, has expanded its worldwide corporate family to the UAE through the signing of a new master franchise agreement with Dubai Enterprises, a diversified real estate development firm. Dubai Enterprises intends to open its own chain of Maui Wowi retail outlets and also sell its own sub-franchises to entrepreneurs throughout the UAE. (Food Business Reviews, 6/5/08)