After in 2020 most franchises operating in the country reported declines in their operations because of the pandemic, expectations for 2021 is to overcome the losses and in some cases grow.
According to the report "Prospects for 2021 and the situation of franchises in Guatemala and Central America" prepared by the Guatemalan Franchise Association (AGF), in the country in the current context four out of 10 companies have closed between 1% and 10% of their franchise units or establishments.
D-uñas, Despierta by cdr Coaching, VR Airsoft, Levaduramadre, Nails Factory, Geotesr and Capricho Diario, are the franchises of Spanish origin that seek to open operations in the Guatemalan market.
In addition to the 32 Spanish franchises already operating in Guatemala, the Spanish Franchisors Association (AEF) presented seven other brands that are interested in competing in the Guatemalan market.
Evaluating the commercial environment of each sales point of, for example, a bakery chain, is key to sizing the turnover potential of each location, a fundamental input for efficiently designing the expansion plan to compete in other micromarkets.
Using the Geomarketing solutions we have developed for our clients, CentralAmericaData's Trade Intelligence team analyzed the environment of some of the main locations of the bakery and pastry chains operating in Central America. Below is an extract of the study's findings.
Recruiting the best staff to operate the points of sale and reducing the costs of the initial investments to set up a franchise are some of the challenges faced by franchisers, who expect better sales in 2020.
Access to financing, containment of operating costs, and maintaining profitability levels are other issues of concern to franchisors in Guatemala.
In Costa Rica, at least 50 investors were interested in acquiring a franchise of the Dota Café coffee system, which in the first months of next year will begin with the opening of two stores in San José.
Despite having agreed to open two service points, representatives of the associative company Coopedota, reported that they still do not define details of the value of a franchise or the specific conditions for obtaining them.
Because of the slowdown in the economy and the entry into force of new taxes, in 2020 is expected a slight growth of 1% in the number of franchise brands in Costa Rica.
In the last year, the growth in the number of franchises reported a significant slowdown, since the figures of the guild specify that up to May this year the net number of brands reached 361, a value that exceeds by just 0.6% the 358 registered in the same month of 2018.
In Guatemala, U.S. chain Denny's invested $2 million to open its second restaurant in a shopping mall in the municipality of Mixco.
The restaurant chain, managed by the company of Honduran Origin Specialized Foods, began operations in the country at the end of 2017, with the opening of a store with capacity for 185 people in Zone 9 of Guatemala City.
It is necessary to expand to inland cities such as Xela, Chimaltenango, Cobán, Zacapa and Puerto Barrios in order to allow franchises in Guatemala to grow and take advantage of market niches.
According to specialists in the subject, the franchises in the country should bet on looking for growth opportunities in the medium-sized cities of the province, before internationalizing.
During the first nine months of 2018, the country reported the arrival of three new foreign brand franchises, significantly below the 17 franchises registered in the same period last year.
In the last decade, 2017 was the year with the highest number of franchises, according to a report by the Costa Rican Chamber of Commerce and the National Franchise Center.
On July 17 and 18 representatives of international franchises from different sectors will be showcasing their business models and meeting with companies interested in acquiring their franchises.
EXPO FRANQUICIA 2018 is being organized by the Chamber of Commerce, Industries and Agriculture of Panama, and will bring together more than 100 companies showcasing 70 exhibition modules from a variety of chains including restaurants , desserts, pastry shops and bakeries, air conditioning technical services, pre-school education, photography and design, manicures and pedicures, business networks, automotive service, and footwear, among others.
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The US company DineEquity Inc. has announced the opening of its first restaurant in Panama City, and plans to open four other establishments in the next five years.
From a statement issued by DineEquity Inc.:
DineEquity, Inc.® ("DineEquity"; NYSE:DIN), one of the world's largest full service restaurant companies and the parent company of Applebee's and IHOP® restaurants, has opened the first Applebee's® Grill + Bar on December 8 in Panama City,Panamait was announced today by Stephen Joyce, CEO and President, International, DineEquity Inc. The restaurant is the first of five locations planned for Panama within the next five years under an agreement with franchisee Collins Restaurant Group, Inc.
The sectors of gastronomy, services and clothing is where most of the more than 200 franchise chains, including both Panamanian and international, that operate in the country are concentrated.
As in other countries in the region, such as Costa Rica, the franchise business is becoming increasingly significant in Panama. Figures from the Economic Studies Center at the Chamber of Commerce, Industries and Agriculture of Panama, show that more than 200 franchise chains are operating, and 15 Panamanian companies have been franchised under this business model.
The US company Denny's has announced the opening of its first restaurant in Guatemala City, which will be operated by a company of Honduran origin called Comidas Especializadas.
From a press release by Denny´s:
SPARTANBURG, S.C.--(BUSINESS WIRE)--Denny'sCorporation (NASDAQ:DENN), one of the world's largest full-service family dining chains, today announced the opening of its first restaurant in Guatemala located on Liberacion Blvd. near the airport. The new restaurant is owned and operated by Honduras-based franchisee, Comidas Especializadas S. de R.L., led by experienced franchisee Mr. Roberto Larach, an existing Denny’s franchise partner. This newest location in Guatemala marks the 13thcountry in Denny’s global portfolio.
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