International Symposium: Good News, Opportunities
Slow growth forecasts, saturated territories and new international and domestic competitors going the extra mile for a slice of your market share–are any or all of these affecting you now? Chances are that at least one of these factors is an important element in your conditions today or in your foreseeable future.
By Carlos Poza
Globalization is an on-going process, which managed proactively, can pay very
handsome dividends. But, ignore it at your peril. If you are lucky, you may lose only a little market share and do well in a continued market growth scenario. In a shrinking market, you are bound to be
surprised in unpleasant ways.
The International Franchise Association’s 2008 International Symposium recently conducted in Los Angeles was all about good news and promising opportunities. The event’s focus was exclusively on the ways and means to successful international expansion. Whether you are ready or not, getting yourself ready is a wise investment. Being ready now can make a big difference in challenging times ahead. With a global perspective, it will always be easier to hold the bad news of the day and focus on the promising and booming markets somewhere else. Market diversification in and by itself is a good option.
The International Symposium’s mission is to provide an interactive learning environment on the subject of international expansion. All sessions of the symposium were led by seasoned experts in every aspect of this challenging field. This year, the range of the symposium’s mission was particularly ambitious. IFA’s International Committee and International Affairs Office covered a wide range of topics from basic techniques and strategies for those exploring international opportunities to specific market assessments and case studies for those who are already fully-committed and engaged in global market enterprises. Today’s tough business environment
compounded by the additional uncertainty of an election year demanded nothing less than clear, comprehensive and practical answers.
Although the formal evaluation results were not available at press time, I feel assured that much of the mission of the International Symposium’s concept and most of the specific objectives identified for 2008 were met by the event. Sixty-four participants registered to attend the program characterized by outstanding presentations and lively interactive sessions. “New-to” international participants found numerous opportunities to network with experienced colleagues and potential allies, while seasoned international players noticed ample opportunities to share best practices, test new ideas and learn from other equally seasoned participants with good experiences in new or challenging markets.
Most IFA members are focused exclusively on the U.S. market. It is also a fact, however, that most IFA members currently doing international work were also limited to the domestic market until, quite unexpectedly, an attractive international contact or offering arrived and led the way to an expanded portfolio. IFA’s position is that properly-planned and smartly-calculated international expansion will always yield better results than spontaneous decisions along the way. It’s a recurring IFA objective to make a significant contribution to its membership by becoming a reliable resource for every member firm in the process of preparing itself for smart global growth. Without a doubt, the symposium effectively served this IFA objective by making sure that every participant learned practical, specific practices, conditions and decisions that spelled success while avoiding alternatives that lead to added risk and corporate instability.
Messages of Opportunity
It is impossible in the context of an article to cover every detail and presentation of the symposium, but the key messages bear repeating.
IFA Chairman Steve Greenbaum, CFE, and PostNet International Franchise Corp. CEO, acknowledged that
the United States faces challenging times, but suggested that the most pressing challenge is to focus on our current situation and secure a significant role and contribution for franchising in the solution of key problems. According to Greenbaum, the will, creativity and drive of the franchising industry’s leadership can harness all of the sector’s energy and vision toward a quicker end for the recessionary period and the return to prosperity and growth. The global marketplace is an important element in the solutions we seek because it contains 90 percent of the consumers in the world and countless opportunities for business activity, wealth creation and corporate expansion.
Lee Sanders, president and CEO of the Johnny Rockets Group offered his views of the rationale, advantages and disadvantages of international franchising ventures, and later focused on JRG’s strategy for international expan
sion. Sanders used a McDonald’s case study to demonstrate that international expansion can help “weather-proof” a company by diversifying markets to neutralize the impact of normal business cycles and by securing revenues from all regions of the globe in order to maximize stability during difficult periods.
The MBE/The UPS Store team of Stuart Mathis, president, and Phil Thomason, vice president worldwide operations, shared with the audience the firm’s evolution to become a major international player, highlighting critical
challenges, essential leadership attitudes and decisions and effective ways to manage risk and uncertainty. Relying on a detailed presentation, Mathis and Thomason assessed the corporate process in Japan, Thailand, Canada and Italy to illustrate challenges in a variety of scenarios and lessons learned that have secured profitable operations in a growing list of international markets.
Eight international business solution roundtables allowed participants to break into small groups addressing issues and sharing lessons learned in regional markets including Latin America, Asia, Europe and the Middle East. Roundtable leaders initiated the dialogue and maintained a constructive approach
to market assessments, selection and penetration, making room for individual concerns and contributions.
IFA Pres. and CEO Matthew Shay introduced the legal panel session and asked the audience to move their thoughts beyond the long electoral period and to give all energy and attention to the works that lie ahead to restore confidence in the citizenry and faith in systems and institutions. The legal panel led by Phil Zeidman, a partner of DLA Piper, discussed developments around the world in legislation affecting the business environment for franchising; Edward Levitt, a partner of Gowling Lafleur Henderson, covered Canada and Europe; Jorge Mondragon, a partner of Gonzalez Calvillo, described the Latin American markets; and Zeidman addressed the Asian region. Conclusion: While some regulation is being added, the most attractive international markets remain open and receptive to franchise offerings.
Interactive sessions led by members of the International Committee covered subjects such as managing a weaker dollar, lead generation, accelerated market expansion, building the franchise relationship, negotiating a market takeback or resale, closing the sale and alternatives to litigation.
A panel of experts’ session rounded out the program. Greenbaum moderated the panel as Peter Holt, COO, Tasti DLite; Ned Lyerly, senior vice president of CKE Restaurants; and Bob Kaufman, vice president for business development and franchising of Coffee Bean & Tea Leaf addressed 10 essential questions for successful international expansion. The four seasoned experts agreed and disagreed on a wide array of ideas to start international business activity, to expand it to become a corporate priority and to manage it through the usual and some unusual sets of circumstances.
Carlos Poza is vice president of international affairs of the International Franchise Association. He can be reached at 202-662-0760 or
Watch for the dates of the next symposium in upcoming issues of Franchising World, the IFA Insider or announcements online at