More than one out of two French franchisors dream of going international. But launching a business abroad is a real challenge and finding a trusted local partner is often a prerequisite for success.
According to a survey, 52% of the networks are considering international development in the next 12 months. To reach their objectives, the brands will have to prepare well for this project, which will take them at least several months.
Before finding an investor in the destination country, the network must first prove itself in its country of origin and carry out preparatory work consisting of five steps :
- a market study that ensures the opportunity to invest in the chosen destination (competition, priority development areas, resources allocated to the project, availability and cost of skilled labor …) ;
- a marketing study that guides the adaptation of the offer according to the local culture (avoid beef in India, propose a halal offer in the Middle East, prefer rice-based products to milk-based ones in Asia…);
- a pricing study that helps build the price positioning according to logistical costs (import taxes, customs constraints, tax incentives, room for maneuver in the pricing policy, etc.);
- a legal study that identifies the presence of obligations in terms of distribution law (disclosure document, government authorizations specific to the operation of a pilot, protection of trademarks, patents and domain names, renewal conditions, territorial exclusivity, non-compliance with the development plan, etc.);
- a budgetary study that presents the hypotheses of profitability of a point of sale and of the project as a whole (entry fee for the country, entry fee for each additional unit, necessary investment, signage and master franchise fees…).
These preliminary phases must take into account an essential parameter: the profile of the local investor to whom the keys will be entrusted in the destination area. As is often the case, there is no such thing as a typical profile. But certain characteristics stand out, depending on the strategy adopted and the strong points sought in the concept to be imported.
The investor who looks for the name more than the quality
Some investors wish to acquire a brand, not a concept. The difference between the two lies in the fact that there is generally no development ambition in the destination country. This type of acquisition is often found in the cafe, hotel and restaurant sector with copies of « trendy » concepts of which there is a pilot in every trendy capital, for example.
Those who aim to fill square meters
Real estate companies or mall owners are attracted by networks that succeed in increasing the number of visitors thanks to their commercial name. This type of investor must surround himself with operational people so that their acquisition finds the expected rental profitability but also the profitability of the exploitation.
The one who aims at the name and the quality
This type of investor has the advantage of being able to quickly set up in strategic locations (train stations, airports, etc.), but like the profile that seeks to fill square meters, it generally lacks the operational staff in charge of the economic success of its investment. Often, he must « poach » the director of a competing concept to ensure control of the development.
The highly motivated individual
A private investor does not have enough contacts and resources (legal, HR management, etc.). This results in a long development time, if the project is done! These profiles are finally characterized by a high rate of withdrawal during the project, without notice.
This is often a professional who is passionate about the sector of activity in which he invests. This type of profile has already sold and resold several groups that he managed to make profitable. Beware: this future partner may have a short-term vision, in contradiction with the contractual spirit of the master-franchise, signed for a good decade.
Other types of profiles exist. Whatever the advantages and disadvantages of an investor, prior discussions make it possible to clearly define the contours of the future partnership and to precisely define in the master-franchise contract the points of vigilance that will guarantee a development outside France, in accordance with the envisaged strategy.