Franchising is all about stable and sustainable growth, and overseas expansion is a key part of the journey for many franchisors. The thought of running your own business across multiple countries might seem daunting, but, with a few carefully considered steps, you can grow a franchise internationally with great success.
At a time when the world is reeling from the effects of the Covid-19 pandemic, you could be forgiven for putting off your international franchising plans. But the widespread economic crisis might just offer exciting opportunities.
Most notably, owners of expanding businesses can capitalise on the unemployed workforce available in many foreign countries. What’s more, some markets will be able to make a relatively quick recovery as we emerge from the pandemic. If your model is strong and has been able to thrive during the pandemic so far, you’re in a good place.
Why grow a franchise after the Covid-19 pandemic?
Statistics show many businesses have decided to continue with their overseas expansion plans, despite the pandemic. In fact, 45 percent of businesses are either growing currently or planning to within the next year.
Meanwhile, 83 percent of bosses are exploring possibilities with remote, global workforce models to combat the challenges brought by Covid-19 (Globalization Partners and CFO Research).
North America has been the most popular location for expansion, followed by the Asia-Pacific region.
This research offers grounds for optimism that the economic crisis caused by Covid-19 has not derailed international expansion plans for most businesses who were already on this path.
—Nicole Sahin, Globalization Partners Founder and CEO
How to grow a franchise overseas
These are some of the top considerations you’ll need to make when expanding a franchise overseas:
1. Research local laws and regulations
When you’re trying to grow a franchise outside of your home country, make sure you don’t get caught out by any legal technicalities. Even within the European Union, member states may have different laws and regulations, which could affect your business’s operations. Be sure to research areas such as trademarking costs and tax and employment laws.
Also, don’t forget to consider the implications of Brexit on franchising. The UK’s decision to withdraw from the EU has affected some of the standards business owners must uphold. So, make sure you understand your rights and obligations if you plan to grow a franchise into European countries.
2. Rethink your products and services
Localising your products and services is vital if you’re growing a franchise across different countries. Rarely will ‘one size fit all’, so you should consider the needs and expectations of your customer base and find ways to adapt your product offering.
McDonald’s is an excellent example of a franchise unafraid to think outside the box and tweak its model. In Italy, the brand’s burgers contain pancetta, used in some of the country’s most loved dishes. Meanwhile, in Singapore, McDonald’s customers can order jasmine tea, and Chinese branches have incorporated rice into many of their menu items.
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3. Refine your recruitment strategies
A successful franchise system should have teams of qualified workers who understand how to do their job effectively. But, as a global franchise, you'll have to adapt your recruitment scheme to make sure it's appropriate for each location and complies with local laws. Hiring processes vary from region to region, so a seemingly acceptable practice in one country might be considered unprofessional in another.
Remember, Brexit could affect franchisees’ ability to recruit candidates from EU member states. It’s a good idea to do some research and make sure there are procedures in place to help them appoint suitable employees.
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4. Adapt your marketing campaigns
If your promotional material is to have a positive effect in different countries, you’ll need to tailor your content to each location. Some messages may not be understood by other cultures and could even offend people.
For example, hiring a translator isn’t enough to create effective international marketing campaigns. You’ll also need to translate the ideas, so your campaign achieves its intended outcome in different cultural contexts.
Even if you’re growing a franchise across English-speaking countries, you'll still need to make sure your content is appropriate for different audiences and not misleading. Part of this process is eliminating any linguistic differences, which could make your brand look ignorant and unprofessional.
5. Localise your brand design
You should also consider cultural context when it comes to your brand’s graphics and design, as certain images and colours may have different connotations across the world.
Take, for example, the colours red and blue. In the UK, red is used by the Labour Party, and blue by the Conservatives. Red is also often associated with socialism or liberal ideas, yet in the United States it represents the conservative Republican Party, while the more progressive Democratic Party has blue imagery.
The critical point is to research your markets carefully, as it can be easy to overlook cultural nuances and inadvertently add unrelated messages into your promotional material.
6. Get to know your audience and their lifestyles
Researching your target customer base to learn about their daily habits, challenges and values will help you create a relevant offering and market it effectively.
If you’re planning to set up restaurants in commuter towns, you could generate extra revenue by promoting your takeaway menu on social media at midday and around 5pm. Not only will you be identifying a demographic (busy, working professionals) but you’ll also be empathising with their circumstances (they either don’t want to cook or don’t have time to).
See success with international franchising
Even in unstable economic climates, deciding to grow a franchise internationally can pay off. Take a look at our guide on the advantages of choosing to go global, and the common pitfalls to avoid - or use the search box to find other informative articles for franchisors.
Alice Tuffery, Point Franchise ©