Establishing a franchised business across international territories presents a variety of unpredictable challenges. Franchising is a successful business model because it enables partners to take a proven, profitable system and replicate it in multiple locations, but new challenges present themselves when implementing a business model in countries with unfamiliar laws and cultures. These challenges take many forms, from potentially embarrassing, but often amusing quirks in business etiquette to major obstacles in implementing the franchised business model across borders.
As Sky Zone has grown from its home territory in the United States to locations spanning four – soon to be six – continents, we’ve had our share of learning experiences and amusing gaffes. While hosting potential partners from new territories for meetings at our headquarters, we frequently display their national flags in our lobby. Recently, we hosted a visiting developer and proudly hung a sizable replica of his country’s flag. Noticing some awkward glances between him and his associates, I finally discovered the flag was upside down and they were too polite to tell us. The lesson, of course, was classic: pay attention to the details!
Beyond silly gaffes, meeting with diverse groups of international business people frequently provides opportunities to learn many potentially awkward lessons. We thought a teleconference with one of our foreign partners was going poorly, as the exhausting conversation stretched through several hours of incessant questions. Finally, one member of the group sensed our frustration and spoke up, explaining that their business culture pretty much requires them to question everything and they were enjoying the experience!
Cultural anecdotes aside, taking a franchised business across international borders requires a dedicated, creative and highly capable team to overcome a wide array of challenges. When establishing our first locations in Central America, our team had to re-imagine what an ideal location could be. We were accustomed to massive industrial spaces in our home territory, but we had to adapt to smaller footprints for our parks due to the availability of real estate in our target markets. This, coupled with the cost of importing materials from the U.S., drove us to reexamine how we can build the parks at a competitive rate while maintaining the look and feel of Sky Zone’s brand. It required us to reconsider how we source a variety of materials, from the special socks customers wear to jump on the trampolines to the materials we use to construct our parks. We had to identify local suppliers for some materials and find more efficient ways to import other materials to the region through a US-bonded warehouse, which reduced costs.
