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Friday 1st July, 2022

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Germany: Where prosperity awaits

Insight

Germany: Where prosperity awaits

Torben Broderson, CEO of the German Franchise Association, believes the country’s franchise industry is ready for a year of immense success

KM: What were some of the main learnings that brands took from 2021?

TB: It was a time when the quality of the franchise network received special importance; the quality and support of the franchisor, and the exchange of know-how. During the pandemic, you could see whether you had a high-quality franchise network, or whether you had holes that needed fixing.

KM: Why should Germany be at the forefront of a European franchise development strategy?

TB: Because of the German economy. It’s still strong and stable, even after the new government took over in December 2021. We are one of the strongest economies within the European market.

What we saw in 2021 was an increased number of franchisors coming from abroad to Germany. We also saw that there are two kinds of franchisors moving into Germany: the first is a franchisor that is piloting and testing and adapting. They’re starting with a strong foundation to build the network.

The other kind of franchisors are sitting in their origin countries and headquarters, and are waiting for people who are interested. They’re complaining that there are not enough leads that they can bring onboard. We’ve learned that international franchisors need to be proactive and get to know people; they need to deliver knowledge to their networks.

KM: What sectors do you see as important in 2022?

TB: I think it’s still the service sector, and the restaurants sector. Lots of trade and retail franchisors need to change and innovate; they need to move online and find solutions around changing customer behavior.

We learned in 2021 that retail brands had a very good year, but a large portion of that was from online trade. There was hugely reduced traffic in cities. Consequently, franchise networks need to find solutions so that franchisees and franchisors can make a profit from this shift online.

KM: Will the challenges and roadblocks presented by the pandemic remain this year?

TB: I think that brands have learned a lot during the two years of the pandemic, but the learning doesn’t stop now. That being said, franchises have set themselves up for a prosperous 2022. This will be maintained; good franchise networks never stop innovating, and are always finding new solutions.

KM: What are you personally excited about for German franchising in 2022?

TB: Personally, I am very curious about how we can transfer the franchise model to new industries. We have a goal to introduce franchising to the medical sector. We want to convince the stakeholders in this area about the advantages of a franchise model.

2022 will be a year where we’ll be communicating more about the role of the franchise model. McDonald’s celebrated 50 years in Germany at the end of 2021, and that brand is an anchor of the German franchise community. We have other brands that were established in the 1970s, so we’ll have lots of concepts coming up that have been operating in Germany for 50 years. It’s a very exciting time.

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