PARIS, France (Blue MauMau) - "The biggest franchise fair in the world," French franchisors were proudly announcing. The Franchise Expo Paris had some 450 brands, more than at International Franchise Expo in Washington D.C.. While some 80% of exhibitors were French, there were 30,000 estimated visitors, most middle-aged.

In contrast, exhibits were often staffed by those under 30 years of age. In France, the average age of a new franchisee has grown to 44. According to the yearly research made by the CSA institute , while the percent of franchisees aged between 18 to 34 years-old dropped from 22% in 2004 to 16% in 2007, the percent of franchisees 50 – 64 grew from 23% to currently 29%.

Potential franchisees spoke to Blue MauMau's European correspondent, Eugene Driga, that initial investment requirements are increasingly expensive while leases in suitable locations require more capital. Franchisees are selected mostly (70%) from people who have worked as employees for many years. These former employees have savings and now they want to start their own business. Since their narrow business background lacks experience in running a small restaurant or business, they choose to own and operate a franchise to receive support and training.

French Franchisors Want to Export, Americans to Import

Visitors from abroad had free entry to the fair (the entry fee was US$40). It seemed to me an intelligent policy of stimulating French export applied even for small things like this, since 80% of the exhibitors were French and 50% want to export their brand.

Every visitor, whether free or paid, had to complete a survey form to enter the expo.

American franchisors Berlitz, Subway and Curves exhibited separately. Carl's Jr, Crestcom, Fast Fix, Maggie Moos, Rainsoft Sharkey's and others, were grouped at the special USA stand or in International Village. U.S. exhibitors felt that the advice of the IFA or the logistical help of the US Embassy was beneficial.

Interest in Franchising a Business is Higher than Buying a Franchise

According to the research made by the CSA institute, the number of franchise networks in France rose 10% to 1141, while the number of franchised units rose with only 5% (summing 46,000) in 2007. The French assure us that this figure is above the average from other industries, though.

The Paris Expo seemed strongly dominated by young franchisors. This correspondent counted some 30% of brand names being new franchises exhibiting for the first time.

Although no success rate for franchising has been generally accepted, Yves Morot, a member of the experts' college in the French Franchise Federation, declares that over 80% of franchise networks survive for 5 years.

The Doubin Law, the French law of franchising, requires franchisers to provide a "softer" counter part of the American UFOC, named DIP (Document of Information Prior-Agreement). In these French disclosure documents, a franchiser is required to provide only the number of the franchisees that left the network in the latest year and not the last 3-4 years as the U.S. disclosure documents require. DIP does not require disclosure of revenue. Franchise investors look up the records of accounting balances of the existing franchisees.

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