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"International Growth – Why Bother?" DC Strategy

by DC Strategy
International growth is an agenda item for board meetings of a growing number of franchise systems. At present, the international revenue for most franchise groups is very low, reflecting their early stage of development, and in many cases, the unsuccessful international results being achieved.

Any successful international growth strategy is a planned and detailed process as groups such as Boost Juice, PoolWerx, Gloria Jeans, Cartridge World, and Pack & Send would attest. In DC Strategy 's opinion, many aspiring international franchisors are not addressing key issues, leading to poor results. These issues include:
  • The undercapitalisation of head office
  • Adopting a reactive rather than proactive approach
  • A lack of development of the international business model
  • Preparation of legal documentation based on a transition of Australian legal arrangements rather than the development of an international franchise strategy
  • A poor understanding of the target country and region
  • Insufficient consideration of the impact on the core business

With Australia representing less than 2% of the world economy the opportunity is obvious. For the uninformed, success in Australia can lead to the assumption that the franchise system is in good shape, a master franchise model is the best strategy, and developing legal agreements is the final key step before finding a person to sign. This is a stereotype that is difficult to break down, with the unfortunate consequence of the loss of potential value and numerous issues being created for another day. Given the opportunity, it only seems fair to develop a foundation for international that is proportional to the opportunity.

Contact Adrian McFedries at adrian.mcfedries@dcstrategy.com

DC Strategy is the region’s premier franchising specialist with an experienced and respected team of specialist franchise consultants and specialist franchise solicitors. As market leader our extensive practical experience ensures our clients have access to the latest franchising know how, outcomes, trends and developments to grow a better and more valuable business.

15.05.2008
FCA MemberFCA Member

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Tel: 1300 905 347

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