Best Franchises for Hispanics
Poder’s annual survey of Hispanic diversity in the franchise business sector
The fifth annual Top 25 Franchises for Hispanics survey continues to underscore the great inroads and progress the Hispanic community is making in franchising. This impressive growth is reflected not only in the number of Hispanic franchisees (and managers of Franchisor-owned units) but in the actual ownership and development of entirely new franchise systems. The Hispanic business community has proven to be exceptionally entrepreneurial and committed to making a success of their lives. In this edition we also highlight six companies that were developed from the ground up by Hispanic entrepreneurs (see following article on page 70). All are thriving and growing in an economy still struggling to recover from the deepest recession in 80 years.
As a prospective Hispanic franchisee, and all other things being equal, there are two key factors to strongly consider. First is the number of Hispanic franchisees there are within a given franchise system. Second is the number of Hispanics there are in senior management. If either or both of these factors is high, you can feel very comfortable taking a serious look at becoming a franchisee of that system.
The methodology for selecting the Top 25 Franchises was based on a detailed survey sent to each of the 3,500 plus franchisors headquartered in the U.S. and Canada. Among other things, the survey asked for the number of Hispanic franchisees or managers of Franchisor-owned units. These numbers were converted into the percentage of total operating units owned or managed by Hispanic franchisees/managers. Similarly, we looked at the percentage of the franchisor’s management team (those making more than $60,000 per year) that were Hispanic. Ultimately, we compared these percentages from the various responses we received. Out of this list, the top 25 companies were selected. It is interesting to note that Hispanic franchisees make up a majority of franchisees in several large companies. For example, virtually all of the 45 franchises of Estrella Insurance are Hispanic. Among large franchise companies, more than 61 percent of Jan-Pro’s franchisees are Hispanic and 43 percent for Vanguard Cleaning Systems. Even for industry giant McDonald’s, Hispanics make up over 25 percent of their total of 12,464 domestic franchisees. Among the mid-sized franchises (less than 200 units), there are several companies where the vast majority of franchisees are Hispanic: Pronto Insurance (94 percent of 113), Taco Maker (88 percent of 130), Pizza Patron (57 percent of 97) and Fiesta Insurance (42 percent of 97).
Systems - Guts and Determination
To say that it takes guts and determination to become a franchisee may be somewhat of an understatement. Given the inherent difficulties for a minority to do so takes an additional sense of effort and commitment. But for a minority, especially first generation Hispanics born outside the U.S., starting a new franchise system requires an additional dose of entrepreneurship. In addition to the language obstacles, there are also the hurdles of having the right mix of business experience, obtaining funding, and, ultimately attracting customers and clients to their business over the long-term. In researching Hispanic-owned franchises, we were able to identify six successful companies that show a great deal of promise:
1. Uni K Wax Centers were born out of Noemi Grupenmager’s own experiences in Brazil. When she came to the U.S., she saw a need for fast, painless and inexpensive hair removal systems. To that end, she formulated a proprietary wax system that is fast, painless and inexpensive. There are currently 24 operating units in the system. It is interesting to note that Grupenmager has received many offers to purchase or distribute the proprietary waxes. Convinced, however, that the waxes are only part of the experience and the desired end result, she has instead decided to pass up the quick dollars and focus solely on franchising the total package. www.ukwfranchising.com.
2. Pizza patron One of the most successful, as well as one of the largest Hispanic-owned franchises is Pizza Patron. It currently has 92 franchised units and eight company-owned units and is growing rapidly outside of its Southwestern base and beyond the initial focus on take-out only stores. Their primary objectives, according to President Guillermo Estrada, are two-fold: first to provide value to their customers in terms of great pizza at a reasonable cost and, second, to provide confidence and support to their franchisees in order to convince them that they can both succeed and grow. To offer better, faster service, Pizza Patron has worked with an oven manufacturer to provide a turn-around time of 3-and-a-half minutes versus the standard wait time of 5 minutes. This is critical to their new drive-through concept and a great advantage over other pizza
3. BannaStrow’s The founders were originally food-service entrepreneurs from Colombia with strong customer service experience. When CEO Mauricio Avevedo migrated to the U.S., he and his partners took a business-oriented approach to design a company from scratch that combined many of the essential ingredients for successful franchising: highly-trafficked areas, easy to operate, low front-end investment, all day products that appeal to the whole family, minimal competition and fresh ingredients with minimal waste. The business they ultimately developed provides a wide range of crepes, waffles, salads and wreps (wrapped crepes) that have been very well-received. They currently have four operating units. The current and future mix includes kiosks, airports, universities and even mobile trucks. www.bannastrows.com
4. Pronto Insurance was started by five brothers who saw a need to provide affordable, short-term (one-to-three month) auto insurance policies to the Hispanic community in Texas. They have subsequently branched out into home insurance and tax services. Although they started franchising only 18 months ago, they currently have 27 franchised locations and 100 company-owned locations. All but two of the franchisees are Hispanic. All of these locations, including the 700 independent agents that represent Pronto, are located in Texas. At present, they plan to fully develop Texas before moving outside the state. www.prontoinsurance.com
5. bullritos is a new Tex-Mex concept that has grown to 11 Texas-based locations in just 17 months. This is remarkable in an economy that most would describe as terrible. That growth is a great commentary on the concept and the quality of the food. Russell Ybarra, President of Bullritos, grew up in a Tex-Mex restaurant family (which includes several other non-franchised brands) that eventually paved the way for his “call-it-like-you-want-it, bull-themed burrito joint.” Their newest unit will be in Louisiana and others are scheduled for Georgia. Joe Aguilar, chief operating officer, noted that financing has not been a major problem, partly because of the success of other family-owned units that provided comfort to lenders. Realizing that young children frequently determine where a family goes to eat, Bullritos provides free ice cream to its guests. It is hard to imagine that the family
won’t be going back to Bullritos on a regular basis. www.bullritos.com
6. kana cuban coffee roasters is bucking the franchising odds (Caribou, It’s A Grind, Tully’s, etc.) with a gourmet Hispanic coffee brand that will focus on bringing the unique delights of Cuban coffee to the U.S. Although they currently have no operating units, they have nevertheless started the process and have a very enticing website and range of products. While the management has been roasting coffee for generations, they focus on roasting coffee specifically to achieve flavor profiles familiar to all Hispanic cultures. Although they import beans from all over the globe, they specialize in coffees that are grown in Latin American countries.www.kanacubancoffee.com z
Top 25 Hispanic Franchise Companies
1. Anytime Fitness
As an innovator of the 24-hour, co-ed fitness industry, Anytime Fitness delivers a secure, quality and affordable fitness experience to its clients in more than 1,300 health clubs worldwide.
2. Burger King
As a leader in the fast-food industry, Burger King serves their trademark burger, The Whopper, alongside a dynamic menu that offers choice and affordability to customers all over the world.
3. Church’s Chicken
As one of the largest quick-service chicken concepts in the world, Church’s Chicken has been serving freshly cooked original and spicy fried chicken since 1952.
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