ABSTRACT
Franchising has played a significant role in the development and expansion of businesses in the USA for many years. For example, the number of business format franchisors has grown from 909 in 1972 to over 3,000 in 1993 (Entrepreneur Magazine, January 1994) while, in the same period, individual outlets grew from 189,640 to over 570,000 (IFA 1991). In 1991, 540,000 franchised outlets had sales of over $750 billion, accounting for 35 percent of all retail sales (IFA 1991). A similar pattern has emerged in the UK, where a survey conducted by National Westminster Bank for the British Franchise Association in 1991 revealed 18,600 franchised outlets with sales of $4.8 billion, forecast to rise to over £10 billion by 1996. Reflecting this pattern, Stern and El-Ansary (1988) estimate that 10 percent of all retail sales in Europe are through franchised outlets. Indeed, the International Franchise Association estimates there are between 11,000 and 62,000 franchised outlets outside the USA and the UK and that sales generated will rise to $1 trillion by the year 2000 (IFA interview with Terrien Barnes, Director of Research, January 1993).
