In the Press
Antonio Express-News
1/18/2012
Franchising is on rise
By William Pack
Despite the nation's economic woes and the challenges
that come with introducing new products to the market, Rising Roll Gourmet is
pleased with its first 10 months in San Antonio and is counting on growth.
"We think it's one of the coolest Texas cities that flies under the
radar," said Mike Lassiter, president of the Atlanta-based deli lunch and
catering company that hopes to identify a second San Antonio location over the
next year. "We're excited about where we fit in the market."
Rising Roll is not alone in its growth planning, and San Antonio won't be the
only city to add franchises if, as one study forecasts, the industry is in line
for a modest recovery this year.
The International Franchise Association Educational Foundation predicts the
nation's franchise business count will increase by 1.9 percent this year, or by
13,928 establishments, and direct franchise employment will jump by 2.1 percent
to more than 8.1 million jobs.
The report also estimated that franchisers are responsible for 3 percent of the
nation's gross domestic product and that output attributable to franchisers
will grow by $21 billion this year to $460 billion.
It's not viewed as dramatic growth, but after three years in which the business
count declined and the employment count rose only once, officials were
encouraged by the 2012 numbers.
"The good news is we appear to be turning the corner," said Bob
Tierno, area developer for the Entrepreneur's Source, a franchise and business
consulting business.
Tierno said inquiries to his company suggest franchise growth in Texas will
exceed the nation's rate. The state is adding population, didn't see the
collapse other states did in housing and has a business-friendly environment,
all of which promotes franchise development.
San Antonio has those advantages plus a large number of retirees and wealthy
Mexican nationals who might see franchises as a good investment, Tierno said.
He and others see San Antonio as a place ripe for franchise expansion.
Chuck Lennon, president of TeamLogic IT, a networking, security and data
services firm, said he was surprised by the large number of small-and
medium-size companies - those that depend on TeamLogic the most - in San
Antonio. He also was impressed by the city's low operating costs.
"There's tremendous opportunity," Lennon said.
Winmark Corp.'s president of franchising, Steve Murphy, described San Antonio
as a "phenomenal market." Winmark oversees one Once Upon a Child
outlet and two Plato's Closet stores in San Antonio, the oldest of which
blossomed into the company's top-selling outlet in fewer than 21/2 years.
"I'd think there's still a lot of potential here with a good
franchise," said Melanie Van Dyke, who owns that top-selling franchise and
expects to open a third Plato's Closet in San Antonio by May.
John Dini, president of MPN Inc. business consultants in San Antonio, offered a
note of caution.
In the next four to five years, as the baby boomers who helped fuel the
franchise explosion retire and die, franchise operators will have a harder time
finding enough people with the interest and money to take their place, Dini
said.
wpack@express-news.net
Copyright © 2012 San Antonio Express-News
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