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Why international franchising?

Over the next few weeks, we’re going to be analyzing certain components of our Top 100 Global Franchise rankings. There’s enough material in here to keep us blogging until Christmas. I hope you’ve been finding the poll as informative as we have.

Today, we'd like to tale a general look at emergence of international franchising. The Wall-Street Journal recently wrote a long and informative story on how American franchises are exploring international options in order to discover new markets. The timing couldn’t be better, as the next day we published our Top 100 Global Franchises rankings. The story focuses on a few big franchises, like Subway, Curves and McDonald’s. Basically, it states that larger, more established franchises are now looking to foreign markets to expand. Look at McDonald’s. This year they’ve opened 53 units in America. Compare that with 286 units abroad. Subway has opened 202 more franchises abroad than in America since January 2008. These are the top two franchises in our Top 100 Global Franchises and they provide the template for any franchise looking to expand. Franchisors looking at foreign markets must take an already easy-to-replicate franchise concept and streamline it further. "We've kept costs and fees low, and our operation very simple," says Don Fertman, Subway's director of development told the WSJ. "It's the type of business that just about anybody can get into." Now take a look at our rankings. Of the Top 100 Global Franchises, 85 are based in America. Six of the top ten franchises sell food. Let’s say you’re a food franchisor. You’re doing well and you want to grow your business. There’s the highly competitive domestic market, and there’s the wide-open world of international franchising. It’s one that’s fraught with risk, but nothing was ever gained without something being risked. It's an interesting time for franchising. As countries around the world like France and Germany emerge out of recession, perhaps the best opportunity to grow lie in far-away places. The beauty of franchising is that it not bound to any single language, just a single concept.

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