Retail franchise sector overview

From Dubai to Brazil, shopping malls are packed full of retail franchises, selling everything from luxury fashion brands to home and office storage solutions .

For many countries retail franchises provide an essential part of their GDP, for example in the US it is estimated that the franchise retail establishment accounts for over 40 per cent of the country’s retail sales. This combined with the current shift in the world’s wealth from the US and Europe to countries in Asia and South America, means that there is a growing demand for expansion of retail franchises in new countries and territories.

Many retail companies choose to expand their brand through franchising even if they prefer to open company-owned stores in their own country. The UK-based children’s retailer Mothercare, which does not franchise its stores in the UK, has successfully expanded internationally through franchising and its overseas franchise business currently operates through 358 stores in 45 countries, primarily in Europe, the Middle East and the Far East.

Retail brands are often keen to expand internationally using the franchise model, as it allows them to achieve steady growth without the major financial commitment that opening company-owned stores would demand. As well as this, for a franchisor having a franchise partner in new territory will provide an insight into the local culture and customs.

For the franchise owner, unlike other sectors, a retail franchise is always operated from a store, concession stand or stall. This means that the franchise owner is able attract potential customers through the store’s branding. Additionally, retail franchise owners are able to visibly display their products to consumers, whereas franchise owners in other sectors often have to rely on explaining to potential customers what the products and services they provide are.

On the other hand, with a retail store a franchise owner must take into account that operating from a outlet will require a larger number of overheads, such as hiring and paying staff. For those that own the Master Franchise rights for a retail franchise then employing reliable staff will be essential to successfully operating a network of stores.

The fact that there is such a wide range is retail franchises available means that potential franchise owners should be able to find one that will suit their budget, skills, experience and interest. On this website there are number of retail brands that offer franchises from a number of different countries all of which are looking for franchise owners to expand internationally. As well as this there are a number of exhibitions and events that take place throughout the year in countries all over the world that often feature retail franchise opportunities.

Written by Derin Clark