A RECENT STUDY CONDUCTED BY PROTOCOL THAT BRIEFED THE MARKET ON THE LEBANESE FRANCHISE SECTOR REVEALED THE FOLLOWING DATA:
• The country’s franchises are worth USD 1.5 billion per year and 4 percent of GDP • The franchise industry employs
99,000 workers • There are 744 franchise companies in operation, accounting for 6 percent of all national companies • 70 franchise members are under the LFA, of which 42 percent are restaurants and cafes • There have been 79 deals made
versus 21 terminated • 14 lead or potential franchisees tap Lebanese franchisors per year, with 2 to 3 percent of negotiations closed • USD 55,000 is the upfront, initial franchise fees for local franchisees versus USD 184,000 for those abroad • Marketing fees are 1.9 percent of sales for local franchises versus 2.1 percent for those abroad • Royalties are 4.9 percent for local franchises versus 5.4 percent for those abroad • Average fees charged by international franchisors are: franchise fees - USD 157,000; royalty fees - 9.2 percent; marketing fees - 4 percent • Franchise deals made by Lebanese franchisors by geographical location are divided: KSA - 24 percent; UAE - 19 percent; Kuwait - 14 percent; Qatar - 10 percent; Africa - 11 percent; Europe - 6 percent; and US - 6 percent • 1,100 franchise concepts operate locally, of which 450 are Lebanese • 5,500 is the number of foreign franchise outlets operating locally: 2,400 Lebanese and 3,100 foreign • The new markets to tap are the south Mediterranean – Morocco, Tunisia, Algeria and Libya – since it is seen as too early to enter Europe. It’s also best to choose emerging markets over virgin markets