Hispanics are the fastest growing economic population in the U.S., the
presence of Latinos is relatively low in the franchising industry according
to Cindy Vanegas of HispanicTranding.net. A December, 2011 International
Franchise Association study cited by Ms. Vanegas indicates that only 5.2
percent of franchise businesses are owned by those of Hispanic descent.
Furthermore, in a previous article published in December 2010 at
DiversityBusiness.com, Hispanic Market Advisors reported that
franchises are looking for Diversity.
Partly responsible for the low numbers of Hispanics represented as franchise
owners is that many people are under the impression that franchises are
limited to retail and fast food outlets. Many more franchise opportunities
beyond just fast food and retail exist and sites like
BuscaTuFranquicia.com seek to match Hispanic
entrepreneurs with franchisers in several industries. In addition, the site
educates Hispanics regarding the options available to them with franchises,
and the site encourages Hispanic entrepreneurs to consider becoming
franchisees of established and viable chains.
Franchise opportunities exist in a variety of markets, including travel,
advertising, retail, automotive and service. In fact, many franchises
actively reach out to Hispanic entrepreneurs because these companies
recognize the importance of appeal to the fast growing economic power in
U.S. - the Hispanic market.
The Importance of Diversity in Business - Diversity is important to
business success, according to “The
Importance of Diversity in the Workforce,” by Barbara
Kahn, Dean of University of Miami’s School of Business Administration. Kahn
posits that diversity generates innovation within companies. A diverse
workforce provides insight into markets that might otherwise be untapped by
the business. Diversity in the workplace has changed from being simply “the
right thing to do to a strategic imperative,” states Kahn.
On the same note, many businesses market to a diverse, multicultural
customer base. Some are successful and some miss the mark. Diversity in
business is necessary to challenge the prevalent ideas that exist in the
business. What matters to different population groups is varied and often
unexpected by the status quo mindset.
Diversity is necessary to bring fresh perspective to businesses. In fact, a
recent study of Fortune 500 senior managers conducted by the Capital H Group
found that 95 percent of those surveyed indicated that creating and
maintaining a diverse workforce was a major goal. Additionally, about 95
percent indicated that a diverse workforce was a key driver of business,
influencing goals and strategies within their companies.
The definition of “diversity” varies from company to company, however. Many
companies do not have defined goals for diversity plans in place. In fact,
definitions are rarely solidified in business. Eight measures of diversity
have been identified by the Diversity Focus Center:
- Socio-economic Status
- Sexual Orientation
Diversity infuses insight and innovation into a company. Diversity
enlightens and educates the company with regards to ethnic and lifestyle
marketing approaches. Diversity in business highlights the importance of
factors that may otherwise remain overlooked. Diversity opens the doors for
businesses to appeal to new markets for the brand. Like other businesses,
many franchises recognize the importance of diversity and multiculturalism
with regards to their franchisees.
Franchises that Embrace Diversity and Multiculturalism Often Experience
Faster Growth - Many popular franchises like
7-Eleven recognizes the importance of diversity
and multiculturalism in reaching new markets and are increasing the brand’s
customer base. Other franchises, such as the Marriott hotel chain, are also
actively reaching out to potential minority franchisees with considerations
such as support for application and royalty fees, credit enhancements,
education and key money.
The hotel chain rolled out the “Marriott International Diversity Ownership
Initiative” in 2005 with the goal of doubling the number of minority-owned
franchises by 2010. The Diversity Ownership Initiative portfolio listed 550
new minority-owned hotels by 2010. The successful initiative earned Marriott
many accolades, including the “World’s Most Admired” company by Fortune
Franchise Opportunities for Hispanic Entrepreneurs - Potential for Fast
Growth - One of the fastest growing economic forces in the U.S. is the
Hispanic market. Hispanics generally have a strong entrepreneurial spirit
and share an excellent work ethic. Though the Hispanic market is not a
homogeneous base, the market is unified by language. A franchisee who speaks
Spanish and caters to a Hispanic population in a neighborhood that is
largely comprised of Latinos will likely to gain the business and the
loyalty of the community. Tapping into the Hispanic market poses fast growth
potential for franchisers and franchisees alike.
The Hispanic population in the U.S. is experiencing exponential growth. In
2012, 16 percent of the U.S. population identifies as having Hispanic
origins. As the Hispanic population grows, so does the buying power of the
Latino population. Currently, the buying power for the U.S. Hispanic market
is estimated to be about $1.5 trillion per year, making the U.S. Hispanic
market the ninth largest economy in the world. Franchises that actively
establish their brand in Hispanic communities insert themselves at the
ground floor of a burgeoning phenomenon.
Franchise systems are beginning to recognize the importance of the Hispanic
market and many are creating initiatives that reach out to Hispanic
7-Eleven, for instance, is reaching out to
Hispanic entrepreneurs through various channels where Hispanics converge.
The buying power of the Hispanic market has increased 347 percent between
the 2000 US Census and the 2012 Census. Because the Hispanic market is
virtually untapped for many franchises, these businesses are seeking to
attract minority, and particularly Hispanic, franchisees and to establish
brand locations in Hispanic communities.
Franchises Enrich Local Communities - Opening franchise opportunities
up to Hispanic franchisees is an excellent business decision for
franchisers, as well as for the local community. Franchises that are owned
by Hispanics in neighborhoods that have a large Latino population enrich the
local community by providing jobs, as well as goods and services. Successful
businesses support the local community with tax revenue. In addition,
successful franchises provide the neighborhood with the thriving business of
a well-known brand. The more thriving businesses that are represented in the
community, the more vibrant and successful the local community will be.
Hispanic-owned franchises also represent the brand well to other members of
the Hispanic community. Franchise brands create goodwill by creating
opportunities for Hispanic franchisees in local Latino communities. The
reputation of the brand is likely to be perceived as positive and
well-received within the community.
Other positive influences on the community would include the franchisee’s
community support and charitable efforts. Because many Hispanic business
owners give back to the community, franchises are well-represented by
conscientious and industrious franchisees.
Diversification in the Franchise System - Diversity within the
franchise system increases the market reach of the brand. On the local
level, the brand has visibility in the Hispanic community. However, on a
larger level, Hispanic entrepreneurs are able to provide valuable insight
into changes that may be made to the market strategy or product to more
readily appeal to the Hispanic market. For example, adding a particular
brand of apparel or a beauty product to the franchise line may dramatically
increase revenue in the Hispanic community. Such feedback into the franchise
system is a valuable asset for the franchise brand.
Marketing strategies may also be tailored to reach a larger audience with
input from Hispanic entrepreneurs. The Hispanic population tends to respond
to marketing strategies that differ from mainstream appeal. Insight into
marketing strategies that appeal to a Hispanic audience may be beneficial
for the franchise brand.
Diversification in all sectors widens perspective and introduces innovation.
The franchise system is no exception. Brand appeal to the Hispanic
population is quickly becoming an important goal for many brands. As
franchisers seek to widen their customer base, the Hispanic market is an
obvious market that, in many cases, is yet to be fully mined. Feedback and
insight from Hispanic entrepreneurs is an avenue for franchisers to gain
knowledge about how to market their brand to this economic powerhouse.
Franchises Are a Viable Option for Hispanic Entrepreneurs -
Franchises are now a viable business option for Hispanics who possess the
means and business acumen required to start the franchise. When a Hispanic
entrepreneur is able to start with a proven business and brand, the
entrepreneur receives the necessary support and know-how from the
established brand. Many franchisers are now implementing programs to attract
multicultural franchisees. As more franchisers recognize the importance and
the benefits of marketing to the U.S. Hispanic population, companies are
offering start-up assistance in many forms to Hispanic entrepreneurs.
Currently, an estimated 2.5 million Hispanic entrepreneurs own thriving
businesses in the U.S. The entrepreneurial spirit is alive and well in the
Hispanic community. Many, if not most, Hispanics seek to have their own
business and work for themselves. Some experts estimate that by 2015, the
number of Hispanic business owners will increase to 5 million.
According to the article, “Best
Franchises for Hispanics,” published on Poder360.com,
the top five franchises that actively seek Hispanic entrepreneurs as new
- Anytime Fitness
- Burger King
- Church’s Chicken
- Coverall Health-Based Cleaning System
- CruiseOne Cruise Specialists
Though some franchisers are specifically targeting Hispanic entrepreneurs as
possible franchisees, this group is often overlooked. Even though 75 percent
of Hispanics in the U.S. are bilingual, many prefer to converse in Spanish.
However, few franchiser websites include a Spanish section to appeal to
bi-lingual and Spanish-speaking individuals. Hispanic entrepreneurs often
interpret this oversight as the franchising company not being
“Hispanic-friendly.” The goal of efforts such as
BuscaTuFranquicia.com is to match franchisers that
have expressed a desire to reach out to Hispanic entrepreneurs with
Hispanics who have the capital and who seek to own their own businesses.
| Contact: | Jose Torres |
BuscaTuFranquicia.com | Phone: 305.972.3014 |