WASHINGTON, D.C. -- The International Franchise Association (IFA) announced Tuesday that it will increase efforts to promote franchise ownership among Hispanics.
Companies such as McDonald's and Krispy Kream Doughnuts have added Spanish-language sections to their websites directed at Hispanics, which will become the largest minority group in the United States by 2005 and whose buying power will soon surpass $452 billion, according to a recent study.
"My job is aimed at getting minorities and women in the United States to take advantage of those opportunities," said Lisa Hawkins, the IFA's new director for Emerging Markets and Diversity.
"Franchises allow small- and mid-sized entrepreneur to use a well-known name to start a business in their communities and to strengthen them economically," she added.
Franchises are advantageous because they provide entrepreneurs with the support of the parent company and industry knowledge, Hawkins noted.
The IFA, founded in 1960, represents large companies that offer franchises in some 100 countries and 70 different industries.
About 80 percent of all franchises require an initial investment of less than $250,000, excluding the property cost, according to the IFA. Franchises are most common in the restaurant, retail, services, automotive, maintenance, construction and hotel industries.
Among the companies with the highest number of franchises are McDonald's, 7-Eleven, Subway Sandwiches and Salads, Pizza Hut, Burger King, Jani-King International, Tandy Corp., Cendant Corp., International Dairy Queen, Inc. and Kentucky Fried Chicken.
Hispanics, who will surpass Blacks as the largest minority in the United States in 2005, should not make the same mistake as that group, which failed to strengthen their communities' economies, according to Hawkins.
The business executive is planning to develop a Spanish-language version of the IFA website and will soon meet with Hispanic leaders.
Hispanics should develop their own businesses and not leave their economic fortunes in the hands of others, she recommended.
"A good credit history is important in the franchise business, and there could also be incentives for minority groups, such as the reduction or elimination of down payments," said IFA Director of International Development and Global Marketing, Marcel Portmann, a Chilean by birth.
Latin America must also strengthen its middle class so that large companies can take advantage of that market of more than 400 million people, which is much larger than the U.S. market, he added.
In Latin America bureaucratic, legal, political and financial obstacles limit the spread of franchises, Portmann noted.
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