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Businesses Recruit Minority Franchisees to Improve Innovation

The 21st century has marked dramatic changes in the face of America as it continues to evolve into a land with diverse cultures and ethnicity. Today, a variety of businesses tailoring to many different demographics and cultures are cropping up everywhere. Franchises are no exception. Recruitment of minority franchise ownership today is on the rise.

According to the United States Census Office, in 2007, the number of minority-owned businesses rose significantly to 5.8 million, which earned receipts of $ 1 trillion. Many of these businesses were in the repair and maintenance industry, personal and laundry services or health care and social assistance. Minority owners accounted for 20 percent of the total ownership of all franchises.

Minority Franchisees in the Marketplace

Experts indicate that minority-franchisee ownership promotes customer service, new product innovations and innovative market expansions. Many minorities have found success with large corporate franchises, such as Dominos and McDonalds. Generally, minority owners, by understanding cultural norms, will understand practical approaches for marketing to specific communities and hiring talent.

Recruiting minority owners has been slowed by a number of factors in addition to the economy. Traditionally, foreign-born minority business owners may have support from their country of origin; however, for many minorities, such as African Americans, a similar support base is often non-existent.

However, minorities today have more resources available than in the past. Some companies, like Dominos, offer programs that provide financial support and incentives to minorities interested in opening a franchise. Other companies, like Schlotzsky’s, reduce franchise fees, royalties, and other monies for minorities starting franchises.

While governmental resources are available, there is also support for minority-friendly business opportunities through forums, networking and other initiatives. Through the Educational Foundation’s Diversity Institute (EFDI), prospective owners attend seminars, including those that address challenges relating to ethnicity or culture. Specific to the American franchising community, the National Minority Franchising Initiative (NMFI) offers a forum that addresses the under-representation of minorities. Also, the International Franchise Association (IFA) MinorityFran program connects participating companies seeking minority franchise owners.

Business owners, consumers and experts agree that diversity is good for business. As the cultural and racial demographics of the nation change, so should the focus of corporate America. Seeking to include minorities in established and emerging franchises will not only benefit the economy, but reflect a genuine and conscientious effort to promote diversity.


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