From finding the right partner to adjusting your offering to suit local tastes, expanding overseas is no walk in the park. Here are the issues you need to consider
The transformation from a local concept into a global brand requires a strategic, multi-faceted timeline with strict attention to planning and execution. Especially in the restaurant industry, a brand must be able to recognize and leverage its strengths, but also recognize and prepare for potential weaknesses that might make a concept a perfect fit for one market and a greater challenge in another. While this is true for any territory expansion, it is crucial when moving into new international markets that may lack significant brand awareness.
Taking a concept from its original roots and introducing it to an audience that may not have a frame of reference, and finding the right entrepreneurs to help make that a reality, is a sizeable undertaking. But being strategic in market selection and differentiating a franchise opportunity is the first step to what can ultimately lead to a vast reward in making a leap across the globe.
International benefits
Franchising is unique in that a uniform concept can be transformed to fit multiple markets while maintaining brand standards and values. With the right franchisee, a brand can find an in-market expert who can use knowledge of the local market to launch a new location to advantage. Where there may be a competitive market, franchising offers a sense of flexibility and strategy that can help push a concept to grow internationally within a logical sense of progression.
When diversifying into new markets, becoming familiar with a new customer base is an immediate priority. Similar to a first date, you get the chance to make a first impression, especially if market awareness is low. An international concept has the opportunity to learn their new customers’ likes and dislikes, their prior experiences and how to form a trusting relationship with them, and a franchise is able to begin shaping the investment to fit potential candidates looking for a strong business model for their local market.
While it takes up resources to research a new market, especially in a different country, a fresh slate can provide tremendous opportunity for innovation. In addition, it’s a chance to encourage local customers to break into something new alongside the brand. With the excitement of introducing something new and fresh comes the potential for meaningful partnerships with local business partners, communities, organizations and an overwhelmingly positive movement to engage in the latest territory and become a trusted member.
Selecting Partners
Choosing franchisees is always a matter of finding the right fit for both the prospective entrepreneur, and for the brand itself. If you’re looking for a new international franchise partner, it is even more essential to find individuals that will best represent your brand and introduce your concept to an undeveloped market. Local market expertise is invaluable when establishing a presence in a new territory, but the right franchisee will also act as a brand ambassador, willing to promote the history and values of the franchise. This may mean taking a traditional outline for ideal franchise candidates and adjusting it to fit a new international territory. After all, this is an individual or franchise group that will be helping to grow your franchise model from the ground-up in a previously unfamiliar market.
When looking for franchisees to create a strong partnership, oftentimes a specific set of skills is necessary, beyond what you may look for in potential franchisees in your home market. This mean more concrete experience with mechanics, operations or food-service, or a previous franchising background in introducing new concepts to the market. For franchising as a whole and specifically for movement internationally, lining up a franchisee in a new market that is connected within the community can be an excellent springboard into the lifestyle of the locals. An individual who is an active part of the business community, local happenings in and around the area can be a strong foundation when attempting to make a brand fit into a market that is new to the concept.
The right franchise partner to assist in international franchising must come with a strong, independent work ethic. They are driven to bring the story of a business into a new international market, while having an extreme attention to detail and fitting the business to a new market. They must also demonstrate a sales-driven attitude to remain successful in a new market, the ability to fight for and retain the attention of consumers and a commitment to the brand and the business model that will turn a franchise into a valued new member of the community.
Cultural distinctions
Customers may expect certain standards in regards to culture, dress, cooking and atmosphere. When making the leap into a new international market, having the mindset of the customers-to-be can be one of the most difficult barriers to overcome. Learning how to approach potential customers and how to expand the in-store experience can play a huge role in creating an environment that may be foreign to the new market, but intriguing to outgoing individuals looking for a new concept amongst familiar offerings.
We’ve been lucky to bring a concept never seen before in the United States and quickly build a fan following. With appreciation for product, we have been able to tap into an understanding of a new American consumer base. In our new U.S. market, many would never expect to see a single item menu. We have used the novelty and simplicity of our menu as a tool to create a new experience that entices new customers to try our product for themselves. Brands have the power to separate themselves and standout as an innovative member of the local market through recognizing the characteristics and standards of a new market, blending them with core brand values and history.
Real estate strategy
One consistent and overarching indicator of success for any international franchise expansion is a strategic real estate strategy. A brand must calculate how, where and when to expand the business all while being focused on growth and expansion.
Examining new territories, brands should build upon prior research done by other companies and professionals in the area. Be sure to investigate sales growth of similar concepts, business development and continuously growing establishments in the area to determine how your business will fare in a new market overseas. Areas with trends that show consistent growth and economic improvement can highlight opportunities for expansion and show where your franchise can join existing trends that will give your concept a foothold for growth.
Having a strategic real estate strategy in place ensures your brand’s international expansion and growth is a tactical, productive process. It also allows concepts to decide exactly where they would like to position themselves, and gives your team greater control over targeting a new consumer segment.
With a plan of action for location and close attention to market movement and growth, global franchising can be a prosperous action for your brand. With a strategic, rigorous plan in place, your franchise can make a home for itself in nearly any international territory, and introduce your concept to new fans.
ABOUT THE AUTHOR
Founded by Xiao Lu, Yang, Yang’s Braised Chicken Rice opened its first restaurant in Ji Nan, Shandong Province in 2011 and has since franchised more than 6,000 locations across China, Australia, Japan and Singapore, with its first U.S. location opening in Tustin, California in September of 2017
