Setting up internationally: the obstacle course

28 April 2023

Every year, French franchises try their hand at internationalization, in order to take advantage of the manna of foreign markets. Tips and warnings for a smooth landing outside France.

For the past 2 years, in the heart of downtown Bratislava (Slovakia), a beautifully decorated store has been proudly displaying the “Fournils de France” colors. “This is our first international operation,” explains Gaylor Chaudemanche, CEO of this family-run French brand, which has been offering bakery, patisserie and fast-food products in urban environments since 1986. Why did you take such a late plunge into foreign markets? “I didn’t want to move too fast. A lot of chains have fallen by the wayside, either because they weren’t prepared or because they couldn’t find reliable local partners,” assures the head of the franchise, which now has a total of 18 stores, 8 of which are franchises.

In Bratislava, the entrepreneur chose a French professional who had been in the country for some fifteen years, and whose teams already operated 40% of the shopping center where the store is located. “Sales are excellent. Our partner knows his market inside out. Our franchise contract is for 7 years. The franchisee has exclusivity of the brand in the country and in neighboring Czechia for 4 years”, he notes, pointing out that the brand intends to open other stores in the coming months in countries as diverse as Benin, India, Madagascar and Spain.

Like Fournils de France, many French franchises try their hand at international expansion every year, in a bid to find new sources of growth in an often saturated French market. But how do you make the most of your chances? Broadly speaking, there are two main ways to set up outside France.

The first option is direct franchising. In this case, the brand itself recruits local franchisees, for example through a local subsidiary or branch. Another option is the system of indirect franchising, in which the brand relies on a local intermediary: either via a joint venture set up with a local company (which shares development costs and risks), or with a master franchise led by an investor or a major retail group. In this case, the local partner acquires the rights to use and adapt the concept for a given territory and a defined period, then develops a local franchise network, following the conditions fixed with the French franchisor.

Whatever the formula chosen, setting up internationally requires a certain number of adaptations to the French model in order to “stick” to local customs and habits, and adapt to local legislation: product range, employment contracts, communications and training policy, IT system, etc. “Remote sales are always more difficult to manage. When exporting products from France, for example, customs constraints are often drastic. What’s more, the franchise contract with the local partner must specify precisely how the 2 parties will work together,” insists Laurent Delafontaine, founding partner of Axe Réseaux, a firm that supports the development of international franchises.

Managing Director of Cavavin, one of France’s leading wine and spirits franchises (200 cellars), founded in 1985 in La Baule (44), Olivier Mermuys is delighted that 10% of his stores are now international. “Our first ‘foreign’ winery opened in Morocco in 2017, followed by the Congo and gradually Europe,” he recalls. In almost every case, the circumstances are different when it comes to finding the right partner – a prerequisite for successfully setting up an international business.

To develop the brand’s presence in the Benelux countries, the export department has, for example, created a website and social networks to find future associates. To invest in Moldavia, Cavavin was attracted by the profile of a local entrepreneur who had contacted Cavavin in France after discovering the wine cellar concept at the Cannes franchisee. “Each time, I look for partners who are true entrepreneurs, ready to send sales people into the country, and whose potential and network size I can identify. On the other hand, I reject French wine lovers who have spent a vacation in a country and want to open a store there. The international test is demanding and takes time”, he says. In other words, amateurs: refrain.


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