GLOBAL FRANCHISE MARKET ANTICIPATES GROWTH IN 2010
World Franchise Leaders Gather in Brazil for World Franchise Council Meeting
WASHINGTON, Nov. 10, 2009—Delgates attending the World Franchise Council meeting in Bahia, Brazil recently reported the global franchising market was in strong health and anticipated growth in 2010, the International Franchise Association said today.
The WFC is comprised of franchise organizations from 41 countries each representing the franchising sector in their respective countries and represents 30,500 brands with over 2.5 million outlets. In the United States, franchising creates 21 million jobs at 900,000 locations nationwide and contributes $2.3 trillion in economic output.
“The franchising model is growing strongly in almost all regions of the globe, including the developing economies of central Asia, Eastern Europe, and South America,” said IFA President & CEO Matthew Shay, who represented the United States at the meeting. “Leaders attending the meeting were optimistic that franchise companies would help lead the way to a global economic recovery, creating jobs and economic output in countries around the world.”
Shay said that many member countries reported resilient franchise revenue and profitability in 2009, despite the global financial crisis. While some markets did experience some contraction, the majority of countries in Europe, Asia and the Americas reported better than expected results, and strong optimism for improved trading in 2010.
For example, Brazil, expects to close 2009 with a 14.5 percent increase in national franchising sales turnover – from $32.3 billion at the end of 2008 to $37.1 billion at the end of 2009. Brazil expects franchisee numbers to grow 6 percent by the close of the year, from 72,000 at the end of last year, to 76,000 at the end of 2009.
Australia also reported strong franchise business growth, with the number of systems in operation growing more than 10 percent from October 2008 to October 2009 (according to figures compiled by franchise trading and information website www.franchisebusiness.com.au) as well as resilient profitability in most market segments.
Shay reported that the U.S. franchise industry was projected to see modest declines in 2009 due to the credit crisis in the country. Despite the lack of access to credit, however, U.S. franchise businesses are expected to continue outpacing other U.S. business sectors in terms of job, unit and output growth. Preliminary predictions for 2010 expect the franchise industry to regain its growth trend. The U.S. has the largest franchise industry accounting for 20 million jobs and contributing $2.3 trillion to the annual U.S. economy.
During the meeting held Nov. 2-4, delegates also continued work on a new strategic plan for the WFC to outline how the organization will play a more proactive role in the development of franchising in 2010 and beyond, especially in assisting developing nations grow their franchise industries.
IFA will host the next meeting of the WFC during its 50th Annual Convention in San Antonio, Texas, Feb. 4-8, 2009. For more information and to register for the convention, click here.
About The International Franchise Association
The International Franchise Association, the world’s oldest and largest organization representing franchising, is the preeminent voice and acknowledged leader for the industry worldwide. Approaching a half-century of service with a growing membership of more than 1,250 franchise systems, 10,000-plus franchisees and more than 500 firms that supply goods and services to the industry, IFA protects, enhances and promotes franchising by advancing the values of integrity, respect, trust, commitment to excellence, honesty and diversity. For more information, visit the IFA Web site at www.franchise.org.