BONUS CONTENT: Franchising a Growing Option

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BONUS CONTENT: Franchising a Growing Option

By Tammy Mastroberte, Convenience Store News - 08/17/2017

NATIONAL REPORT — Whether just entering the convenience store industry or looking to convert existing stores, becoming part of an established brand has many potential benefits for c-store operators. Franchising — whether in foodservice, retail or convenience stores — is a healthy and growing sector, according to the International Franchise Association (IFA).

“Franchising has been growing, and we see a lot of new brands entering the market in a number of different industries,” John Reynolds, president of the International Franchise Association, based in Washington, D.C., told Convenience Store News.

Retail and food, under which convenience store franchising falls, is one of 10 big industry categories the IFA follows. The entire retail and food group has 53,000 establishments, many of them c-stores, and the rate of growth has been 1.2 percent per year.

There are 470,000 people employed in the retail and food sector working for the franchise owners, and the growth in employment has been 2.3 percent — higher than the average employment growth in the United States, Reynolds noted.

“It’s a healthy sector and growing steadily,” he explained, citing that the sales average annual output increase has been 4.1 percent year over year.

C-store franchising — whether franchising the store or just the branded fuel — is an especially attractive option for small operators facing increasing competition from bigger brands. Whether it’s buying power, name recognition or access to the latest research and resources, becoming part of a franchise can fill in the gaps and improve the bottom line.

“In almost all cases, being branded is the right thing for the independent retailers,” Alan Flagg, assistant vice president of supply and marketing at CITGO, told CSNews. “They need a strong brand in a competitive environment if they are going to succeed competing against other brands and large independent c-stores.”

Editor’s note: Look in the August issue of Convenience Store News for more on franchising, including the questions to ask to find the best-fitting franchise.