A complete listing can be found at the FBR (2008) website. However, the nine franchises presented above reflect a wide-range of opportunities, for both national and international investments. Yet, the initial investments for each category vary tremendously. While the above franchises are good opportunities, a highly recognized branded name such as McDonald’s might prove more profitable, if the franchisor has the money to invest. Just to franchise within the United States, an investment of $300,000(non-borrowed resources) is required.
Yet, partaking in an international investment, well, the franchisor could become a non-franchisor. McDonald’s Corporation (2008) wrote, McDonald’s franchises restaurants in many international markets, and decisions relating to the selection of candidates are made locally by the management in the country where the restaurant is located. For interest in specific markets regarding international franchising, please see the list of contacts and franchising information on the International Section of the Franchising page of this web site. Links to individual market web sites are provided where available.
(How can I become a non U. S. McDonald’s franchisee? , #2) Again, franchising can be a profitable venture. However, a franchisor should be prepared to pay all taxes he or she owes. Franchise court cases Baker Botts, LLP (n. d. ) discussed Income/Franchise Tax cases. In fact, Baker Botts, LLP (n. d. ) reiterated, • D. D. I. v. State. Represented taxpayer before North Dakota courts, leading to a unanimous decision by the North Dakota Supreme Court that taxation of dividends received by a nonresident company violated the Commerce Clause. 657 N. W. 2d 228 (2003).
• Represented Pennzoil Company and obtained summary judgment in state district court on proper franchise tax character of $3 billion in settlement proceeds received in Pennzoil/Texaco litigation. • Represented major commercial airline in administrative dispute before Texas comptroller of public accounts regarding franchise tax treatment of air traffic liability accounts. Comptroller conceded issue in full. (Income/Franchise Tax, para. 1) It just goes to prove that no company is exempt from possible litigation. That is why franchisors should understand business law. Conclusion Franchising in foreign markets is gaining interest.
Companies already owning franchises in the United States often believe they can earn larger profits by franchising overseas. That is why they go through all the legal tape to ensure success. Yet, it is possible to not research a situation enough before entering into an agreement overseas. To minimize this risk, franchisors should seek help of experts, participate in programs and conferences to learn about the country they are about to enter, and network with fellow franchisors—exchanging thoughts and tips of valuable information.
References Aguila, L. (1996, April). All aboard! —Overseas franchising. Entrepreneur. Retrieved November 6, 2008, from BNET Business Network website: http://findarticles. com/p/articles/mi_m0DTI/is_/ai_18245797 Baker Botts, LLP. (n. d. ). Litigation: Tax litigation. Retrieved November 6, 2008, from website: http://www. bakerbotts. com/departments/practice_detail. aspx? id=4ae9a138-649f-4fbb-8f8b-1d079a37c9e5 Franchise Business Review (FBR). (2008). Top franchise opportunities for 2008. 2008 Franchise Satisfaction Awards. Retrieved November 6, 2008, from website: http://www. fbr50. com/? gclid=CIH_0tCb4JYCFQ0xawodVReYPQ FranchisingLaw. com. (2003). Guide to the FTC and the FTC franchise rule.
Retrieved November 6, 2008, from website: http://www. franchisinglaw. com FreeAdvice. (2008). What’s in a franchise agreement? Business Law—Franchise Law—General Franchise Questions. Retrieved November 6, 2008, from website: http://business-law. freeadvice. com/franchise_law/agreement_franchise. htm McDonald’s Corporation. (2008). Franchising. Retrieved November 6, 2008, from website: http://www. mcdonalds. com/corp/about/mcd_faq/franchising. html Ong, G. (2008). Franchising overseas. Retrieved November 5, 2008, from website: http://ezinearticles. com/? Franchising-Overseas&id=498206