Deciding to franchise your brand is the “biggest decision” in the life of a business according to Burberry, Gap and Inditex’s Middle Eastern franchise partner Fawaz A Alhokair & Co.
Speaking at Drapers’ Fashion Forum, Gerry Waters, vice president of strategic expansion for continental Europe, Caucasus and central Asia at Fawaz Alhokair & Co, told delegates retailers must ensure they have the right partner for that particular market.
“Franchising is often the preferred option for brands as the partner puts up the capital expenditure, the costs and the risk, but you must make sure the partner is financially sound, has logistics set up in the market and can access prime real estate,” he added.
He also said companies must ensure the market is right for their product. Weber used the example of BHS, which was the first Western retailer to enter the Middle East 20 years ago and is still going strong in that market.
“You need to tap into the local market to see if it’s relevant. BHS is still going in the Middle East as it has a market there, but it didn’t work when we brought it to Belgium as the shopper was more discerning,” Waters added.