451
CHAPTER 15
GOING INTERNATIONAL
INTRODUCTION
B
efore going international one has to consider the bene ts, risks, chal-
lenges, and opportunities. Corporations that have entered international
markets encounter different and unique situations. For example, food habits
in China are very different from those in India. So when restaurant fran-
chises enter any country, careful considerations of all circumstances is nec-
essary. Glocalization is a term that is being used now in light of the fact
that the globalization is a reality and localization is a necessity.
Tracking the
major players in the global growth game, the National Restaurant News pub-
lishes a top international restaurants list.
Top restaurants based on region as
As a franchisee, you are a business owner, but you don’t operate
independently. You’re part of a network and you must follow rules
that call for uniformity. A franchisor may limit your choices about
sales area, training, suppliers, or the merchandise you sell. You may
pay advertising fees and buy or lease from suppliers the franchisor
chooses. If exercising creativity is important to you, think about whether
you would be comfortable working with a franchisor’s controls.“
—United States Federal Trade Commission
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452 Restaurant Franchising
Figure 15.1. International foodservice sales (drawn from data)
(Courtesy Nationʼs Restaurant News).
‘Glocalization’ is a term that is being used now in light of the fact that
the globalization is a reality and localization is a necessity.
extracted from the published information are shown here to emphasize the
width of international growth of restaurant chains. Worldwide foodservice
sales for 2012 were $2.6 trillion and are projected to reach $3.4 trillion.
Asia-Paci c with $1.1 trillion sales showed the highest foodservice sales.
Latin America with 62.1% and Middle East-Africa with 58.2% ve-year pro-
jected increase were among the highest. The other regional foodservice sales
for different parts of the world for the year 2012 are United States-Canada
$517.3 billion; Latin America $282.5 billion; Western Europe $524.8 billion;
Eastern Europe $59.6 billion; Middle East-Africa $75.4 billion; and Asia-
Paci c $1.1 trillion. The comparative sales are shown in Figure 15.1, and a
ve-year projected increase is shown in Figure 15.2.
As seen in Table 15.1 the top ve growth chains include a variety of
restaurants, including limited service restaurants (LSR) to coffee shops and
convenience stores. 7-Eleven, which is more of a convenience store, is one
of the principal providers of foodservice worldwide, with the largest num-
ber of worldwide units. Most of the growth chains seem to be in Paci c
region.
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Going International 453
Figure 15.2. International foodservice projected sales till 2017
(drawn from data) (Courtesy Nationʼs Restaurant News).
In the Asia-Paci c region (Table 15.2), most of the growing units are in
Japan, predominantly convenience stores. Here also 7-Eleven seems to have
the most rapidly growing units. Table 15.3 shows regional foodservice units
in Eastern Europe. This is a still growing area, which may take some time for
foodservice restaurants to grow.
Foodservice units in the Latin American region are shown in Table 15.4.
Most of the unit headquarters are in Brazil, followed by Mexico. This region
has good potential for further development as seen by the percentage growth of
the units. Compared to other regions, this region seems to have more LSRs. It
should be noted that this region also supplies beef and chicken to most of the
franchises worldwide. Table 15.5 shows regional units in Middle East-Africa.
This is also a potential growth area. Other than coffee shops there is room
for growth of chicken and burger chains. Ethnic types of menu items seem to
be favored. Chain headquarters are spread from Saudi Arabia to South Africa.
There are many U.S. franchises that are targeting Middle Eastern region for
growth, particularly in the Gulf Council countries. Most of the Western Euro-
pean units (Table 15.6) are headquartered in England. It is noticeable that in this
region, the bar-pub concept seems to be predominant, maybe due to English
in uence. Bakery shops, also popular in England as well as Europe, seem to
have more units in this region. Finally Table 15.7 shows the units in the United
States-Canada region. As expected most of the franchise units and their head-
quarters are concentrated in this region. However, it should be noted that all
of the franchises listed are predominantly present in many parts of the world.
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