Those people who started the International Franchise Association a half a century ago would hardly recognize today’s business landscape, but still their organization continues to provide advocacy and guidance to franchised businesses around the country.

What began when Dunkin’ Donuts founder Bill Rosenberg brandished a 100 dollar bill from his wallet at a franchisor convention in Chicago back in 1959 is now a hugely mobile and influential organization, as the recent successful of lobbying of President Obama on small business reform shows.

The latest issue of Franchise Times magazine features a detailed story on the history of the IFA. For anyone with an interest in franchising, this is a must-read. Writer Nancy Weingartner takes a decade-by-decade look at the IFA’s evolution, discussing how it planted roots in Washington and began its education programs, and many other things.

Part of the IFA’s initial success was that it let franchisors of all stripes convene and discuss the in’s and out’s of operating a franchise business.

“Companies got together to share ideas,” said Jerry Darnell of Benetrends. “There is no place else to get this information.”

Franchisors weren’t afraid to share best practices because they weren’t sharing trade secrets with their competitors. Members were in a number of different industries and the information they were sharing had to do with business-format franchising, not with burgers or brake jobs.

And as for today? Well, the IFA remains more vital than ever. We particularly enjoyed how the story concluded.

IFA’s challenge is to make business-format franchising a priority in their members’ businesses. They’ve accomplished this in part through economic studies, education and lobbying for small business concerns.

And by selecting volunteers who are committed to the cause. The past chairs stay involved. “They don’t do their time and walk away,” IFA’s CEO Matt Shay said.

“Where IFA goes is where franchising goes,” stated Zeidman.

Here’s to 50 more years of success!

As recent reporting in the Wall Street Journal shows, international development is now a profitable course for many franchises seeking new markets, as economies around the world have been somewhat slower to introduce the franchising model than the US. With its inaugural rankings of the Top 100 Global Franchises, Franchise Direct not only listed the best-performing global franchises, but it provided a blueprint to other franchises eyeing similar growth.

Interviews with franchisors with businesses on the Top 100 list showed that there is no one path to successful international expansion. Selling a master license is a common strategy, but by no means the only route, as Coffee News USA discovered.

“In those countries that are doing well, we will leave them alone. If we take back countries we will run them from here for awhile and then sell them once we have someone who can do Coffee News well there,” said Bill Buckley of Coffee News USA.

Other companies like PakMail have tailored a business model that can be easily reshaped into different foreign economies.

“We are open to further international expansion and prefer to establish master licensees outside of the U.S. The Pak Mail operating concept is pretty easy to adapt to foreign markets as evidenced by the success of our franchises in Mexico,” says PakMail’s Sandy Lasky.

There will be many cultural roadblocks for the franchisor to overcome when opening in a foreign market. “Knowing the culture, language and business processes, as well as ensuring successful product distribution,” are some of the problems that PuroClean encountered when it launched its Canadian operation. However, it found a solution that changed the way it did business in the country.

“By having a native Canadian manager running operations in Canada, PuroClean has been able to overcome typical obstacles faced when entering a foreign market,” said PuroClean’s Natalie Zupo.

Launching a franchise on a global level takes time and patience. But the rewards can be limitless, as the success of Franchise Direct’s Top 100 Franchises has shown.

This is big news across the news wires today. This legislation will increase the amount of money the SBA can lend by $44billion. It also increases the guarantee rate on SBA-backed loans from 75% to 90%.

“This bill is about choices. It’s about better options for the small businesses that didn’t get a bailout,” said Nydia M. Velázquez, the chairman of the House Small Business Committee.

“Small businesses with tight profit margins don’t have the luxury of simply ‘tightening the belt.’ When money is short, they’re often forced to lay off workers. But with unemployment at 9.8 percent, we just can’t afford more losses. That’s why this bill delivers critical capital to new ventures.”

It’s unclear when the funding will be transferred to the SBA and the bill must also pass through the Senate.

The IFA has come in to support the measure. Let’s hope now that this bill breezes through the Senate and the funding gets into the hands of the people that need it most: those franchisees and entrepreneurs up and down America.

The answer seems to be mixed. If you’ve been following developments over on the You’re The Boss blog run by the New York Times, you’ll know that success in passing the new small business laws are not guaranteed. Initially, it seemed that the President might have to struggle to get his plan through the House and Senate after disquiet from members of both parties.

Now much of the debate has turned to the perspective of Rep. Sam Graves, who is the ranking member on the House Small Business Committee. He had initially announced his disdain for President Obama’s plan. But in an interview with the NY Times, Karen Mills, the head of the SBA, described Graves as “extremely supportive”. Now Rep. Graves’s office has taken exception to this statement, but it is unclear exactly where he stands on the President’s plans. Rep. Graves has declared himself to be an ardent supporter of small business, so it will be interesting to see where he comes down on this legislation.

All of that said, no matter what roadblocks the Republicans throw up, the Democrats will have the votes to pass the bill and it seems that now that support is there for the plan. This is important because there are a number of lingering political issues that are eating into the confidence of small business owners.

The Wall Street Journal recently issued another report on the difficulties facing small business owners. It framed the story around three big political concerns of small business owners: the impending health care legislation, the looming expiration of Bush-era tax cuts and the possibility of green taxes.

With all of these issues looming, it is really time for consensus. The President’s small business plans have to come into effect, and they should only the beginning. For those who doubt the President’s commitment to franchising and small business, here he is again, talking up the importance of entrepreneurship to the American economy:

“The real question is ‘How does green equal better?’” says Joel Makower, executive editor of GreenBiz.com and author of Strategies for the Green Economy told Entrepreneur magazine recently. “That is, how does making the green choice become a no-brainer, because it’s just clearly the better choice. You buy the green car because it’s more fun to drive or a better deal. Until it’s about that, it’s going to be a niche audience.”

We are constantly trying to sketch out where the next big business opportunities will come from on this blog. While there is no denying the strength of the green sector, we are still far away from the day a driver selects a new electric automobile over a gas-guzzler because it provides better fuel efficiency. But the Entrepreneur story has great insight from the businesses that are driving green business into the mainstream.

“The challenge facing green-product companies going mainstream is how to motivate consumers to shop value and not simply price. The key is to define and present both the product and green value in one marketing message,” says David Mleczko, co-founder of Signature Green Marketing, in the piece.

The story identifies the cleaning sector as one of the biggest areas for green growth. Demand is growing for more ethical cleaning products. At Franchise Direct alone, we are seeing a huge upsurge in cleaners targeting the green sector. The story also makes a point of noting that Walmart is doing a lot to improve its carbon footprint and has even been publishing its own sustainability index. So the stars are definitely aligning for the green industry.

And probably more than other industry, green franchises make a lot of sense for entrepreneurs, as they offer a direct path to success, without the unpredictability of a start-up.

Anyone launching a business will want to be targeting a very defined market. But why not pitch that tent as large as possible? That is the argument of Susan Ward, who outlined ten possible areas to succeed with business via the baby boomer sector.

Some proposals are not surprising and have been proposed before on this blog. For instance, health and senior care franchises are only going to get more popular, given America’s rapidly-aging population and the recent rumpus over health care. Equally, fitness franchises stand to do well, as elderly people will need to preserve their health.

One of the most interesting suggestions comes in targeting the pet sector. According to Ward, baby boomers have elevated pets to near-human levels.

Baby boomer pets eat, sleep and do things with their people. They watch TV, they get dressed up, they have their own friends and their own doctors. They are a multi-million dollar industry!

It makes sense, too. Their children have grown up long ago, and pets fill that void. All in all, it’s a demographic that every entrepreneur needs to consider. There are many opportunities to take advantage of with this sector.

A few weeks ago, Franchise Direct published a report on the home–based business sector. The report found that home-based businesses and franchises comprise some of the best opportunities out there in the current business environment. That statement is backed up by new statistics, as well as a new story in Business Week magazine that declares the rise of the ‘homepreneur’.

The Business Week story states that there are 6.6 million home-based businesses in America which account for more than 50% of a person’s income. The story also states that there are over 13 million people employed in the home-based sector, about a million more employees than the home-based sector.

And what’s driving the success of the home-based sector?

“First, technology has made it easier to start and run a business from anywhere. But just as important, there has been a change of consciousness in the business world to recognize home-based enterprises as legitimate.”

Our report makes many of the same points. The work place has evolved immensely over the last two decades and it is safe to say that it is seen by many as the future of business.

In this case, we are specifically referring to test prep businesses. Empirical evidence states that students are staying in college longer and more people are seeking extra degrees, either to reskill themselves, take a break from the recession, or both. Given this reality, one assumes test prep franchises will be noting decent growth, as these tests gain importance.

An interesting story from the Reno Gazette-Journal says yes and no. While a traditional company like Huntington Test Center has seen a dip in numbers attending its course, PowerScore, an online teaching resource, has watched its profits rise.

“We’re seeing a lot of enrollment on classes that are on the less expensive end,” PowerScore CEO Dave Killoran said. “Through the first half of the year our SAT prep enrollment was up about 38 percent over the same period last year. ACT enrollment has been up in the range of 20 percent this year.”

The moral for entrepreneurs considering this educational franchise sector is this: people need this service more and more, but they are very limited with what they can pay. Try to find a franchise that blends affordability with quality and you should have a top business opportunity.

Matthew Shay, head of the IFA, was recently in Washington himself, discussing the state of the Small Business sector with members of the House Small Business Committee.

There’s a lot of information to mull over in this video and we recommend you take a look at it.

EDIT: After posting yesterday, we found this interesting article on the Blue MauMau site, which details the various lobbying of the IFA in Washington over the last 12 months.  It’s quite extensive:

• Oct 14, 2009: IFA’s CEO and President Matt Shay gives testimony to the U.S. House of Representatives, Small Business Committee on the need to free up capital for franchising systems
• Sep 30, 2009: Dina Dwyer Owens, CEO of franchising firm The Dwyer Group and this year’s chairwoman of the IFA, gives testimony (see video) to the U.S. House of Representatives, Small Business Committee asking for the perpetual extension of expiring tax reductions such as the death tax. She also asked for a tax credit for veterans buying franchises.
• Sep 10, 2009: IFA advertises on the impact of the credit crunch. The ad was placed during public affairs conference
• Jul 23, 2009: IFA leaders meet with the Treasury, Federal Bank and Small Business Administration
• July 16, 2009: Matt Shay appears on Fox Business News
• A leader of the Great American Cookie Independent Franchisee Association and a franchisee, Lawrence “Doc” Cohen testified before the U.S. House of Representatives Small Business Committee that the SBA needed to improve its small business financing programs
• Jan 28, 2009: IFA sends a letter to the SBA on the need to not cap lenders ability to finance “goodwill” at $250,000
• Jan 22, 2009: IFA attends the U.S. Conference of Mayors and pitches the importance of franchising to the economic development of their municipalities
• Jan 14, 2009: IFA urges Congress to take steps to increase small business access to credit
• Dec 23, 2008: The IFA urges Treasury Secretary Hank Paulson to use the Troubled Assets Relief Program to improve small business loans

It’s clear that those in the corridors of power are beginning to take notice of concerns of small business owners.  The IFA are partly to thank for this shift. Thanks to Blue MauMau for their top reporting here.

The President yesterday told the small business community that “America is standing behind small business”, as he announced a range of measures aimed to help small businesses and franchises. Joined by SBA administrator Karen Mills and Treasury boss Tim Geithner at the home base of Metropolitan Archives, President Obama announced a number of initiatives aimed to spur lending and revive the small business sector. Watch his speech here:

President Obama’s plans include:

• Letting community-based banks (ie those with assets under a $1billion borrow money at a lower rates via the TARP program)
• A rise in the SBA loan caps from $2million to $5million.
• Community groups that issue loans in poorer areas can borrow relief loans at 2 per cent for 8 years.

IFA president Matthew Shay yesterday welcomed the President’s plan, saying that Mr Obama directly taken on board an IFA proposal.

“We thank President Obama for his support to enhance the SBA’s loan program,” said IFA President & CEO Matthew Shay. “We urge Congress to take the next step and pass legislation to increase the loan limits and make other important changes to the SBA loan program.”

It’s exciting to see the Government finally responding to needs to small business owners, but we hope this will not be the end of its support. What more do you think the Government can do to help franchisees and small business owners?