Bite-size Case Study

International franchisors: iGUi

Published on July 28, 2021 Originally recorded 2021   7 min
Brazilian franchisors can be allocated to different stages, according to their commitment level with international expansion. The initial stage is called domestic franchising, encompassing the majority of the Brazilian franchisors. Domestic operations are an opportunity to test the franchising model, considering that international operations require high levels of control, monitoring, support, and branding skills. Franchisors with international operations are allocated to the second stage onwards. The second stage is experimental engagement, which consists of international operations with low resource commitment, and few units abroad, usually to test the market. In 2017, 80 franchisors were allocated to this stage. The third stage comprises franchisors with active involvement, showing a constant and slow pace of international expansion. In general, companies tend to look for closer international markets with cultural similarities, in order to reduce risks. Thirty-nine franchisors were classified as being in this stage in 2017. The fourth stage corresponds to the highest level of commitment involvement. At this stage, franchisors are operating in different countries, and there are significant numbers of units in every country. Only 23 franchisors were classified as being at this stage. One example of a Brazilian franchisor in the fourth stage of international