In 2004, Enrique Roselli, an executive at Pepsi co., decided that after 17 years it was time to be his own boss. The self-described corporate refugee's extensive operations background and the "incredible business opportunity in Vegas" helped build his new franchise business, AlphaGraphics, and within two years of starting he'd tripled sales.
Mr. Roselli said starting his franchise – AlphaGraphics, with almost 300 shops, is the nation's largest franchise print shop – has been one of the best business decisions he's ever made. "I got a call from a [corporate] headhunter a month ago about a [job] opening in Europe. I said, 'I'm not going back, heck no, I'm having too much fun.'"
Those are the stories franchisors love to hear and Mr. Roselli is the type of Hispanic franchisee many feel they must recruit.
"It is imperative that franchised companies make a concerted effort to reach out to this growing segment of the population now to remain competitive in the marketplace," Ronald Harrison, International Franchise Association Diversity Institute chairman, has said.
Recruiting prospective Hispanic franchisees is based on sound economics, say franchising experts. Minority operators should mirror the increasingly diverse customer base of many of the franchisors, but in some key franchising areas – think of the lodging industry, in particular – Hispanics lag far behind other minority groups in hotel ownership.
"Hispanics have become the largest minority group in the U.S. yet less than 1 percent own hotels in comparison to other minority groups, such as Asian-Indian Americans who have excelled in this industry," says Raul Fuentes, director of emerging markets at Choice Hotels. "Asian Americans, although considered a minority group demographically, are probably the largest stakeholder of hotel/motel franchises within our system."
Out of the 5,200 hotels in the Choice Hotel system in the United States, Mexico, and Caribbean, only about 40 are Hispanic-owned.
Mr. Fuentes attributes this to a "lack of knowledge and misperceptions about the hotel industry."
It's not all bad news. Some areas, such as restaurant and janitorial services, show strong Hispanic numbers.
A recent survey by the National Minority Franchising Initiative showed among those polled, Pizza Patron had 27 percent Hispanic franchisees, Jani-King had more than 25 percent and Coverall had 22 percent. Of course, those companies are concentrated in areas with large Hispanic populations.
The survey also found a few companies with a high percentage of Hispanic managers. Among the chains polled, 50 percent of Pizza Patron's managers were Hispanic, followed by Wing Zone and Wireless Zone, with 20 percent.
Last May, the IFA launched an initiative called MinorityFran to help franchisors connect with potential minority franchisees. MinorityFran links entrepreneurs not only with franchisors but with organizations ranging from the National Urban League to the federal Minority Business Development Agency to both increase the number of minority franchisees and draw attention to franchising as an affordable way to start a business.
And some companies are running their own outreach efforts.
To groom their minority managers to become franchise owners, Domino's Pizza, last year established a program called "Delivering the Dream" which offers mentors and financial support to minority candidates with a focus on individuals who began their careers with the pizza chain.
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