Executive Chat with Rebecca Patt – Featuring Paul Cairnie of World Franchise Associates

Kiev, Ukraine

Thinking about expanding your restaurant concept globally and joining the huge wave of US franchisors that are ramping up international growth?

Then you might want to call Paul Cairnie, a genial Brit who presides over World Franchise Associates, a multi-faceted business dedicated to providing knowledge and resources for overseas franchising and serving as international matchmaker for franchisors and franchisees.

“We do two things, essentially, as a company. We help franchisors to develop new international markets, and we help investors, food, retail, commercial real estate developers, to acquire brands,” said Cairnie.

The company has grown over the last 15 years to include a marketing and consulting business, five websites with international franchising news and databases, and an annual conference in Dubai called the International Food Franchise Forum. He’s also helping to organize another franchising forum scheduled for Moscow this November, the Russia Food & Beverage Forum.

“I think these past two years in America has really alerted many companies that it is prudent not to rely on your domestic economy when there are so many opportunities for additional revenue internationally,” said Cairnie. “There are literally hundreds of American companies that are securing quite significant development internationally. Secondly, if you look at recent profit announcements from McDonald’s, from Yum, from Coca-Cola, from Krispy Kreme, their success in the past two years has been very much attributable to international revenue.”

One needs only to glimpse at the World Franchise Associates news page, updated almost daily, to grasp the broad scope of emerging and well-established U.S. companies securing franchising deals almost daily around the world. The increased international development is also opening up opportunities for restaurant executives to work abroad.

“For any of the brands we sell internationally, the management team is always on the agenda, and quite often, especially the Middle-East companies are very keen to employ European and American management teams,” said Cairnie. “Many of the management teams in the Gulf States are either North American or European.”

Carinie said that the US restaurant industry has huge appeal overseas for investors and consumers.

“America’s position in the world is very much being a business leader in so many disciplines of business. For investors in emerging markets, it’s more than just buying into the business, it’s buying into a learning relationship with US company,” he said.

He said that Americans tend to underestimate the allure of US brands to consumers abroad. For example, in Saudi Arabia, most of the buying population is aged between 20 and 30, and they are willing to travel the extra mile or two or five to dine at an American restaurant rather than a local restaurant. In China, Pizza Hut is a destination location for wedding receptions.

“I think there is a book that could be written about how US brands have translated themselves internationally,” he said.

Cairnie said that franchising of US-based companies is thriving in emerging and established markets all over the world, and without a doubt the hottest markets now are the Middle East and North Africa, or MENA, as some call it.

The Middle East and North Africa have an average domestic franchise growth of at 20 percent or more annually, even as high as 25% in the UAE and Saudi Arabia, explained Cairnie. All of the Gulf Cooperation Council countries (Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and UAE) are experiencing virtual double-digit GDP growth, with the UAE and Qatar now in the world’s top ten per capita. Qatar is now number one in the world.

He also pointed out that total overall population in the GCC region is expected from 35 million to 45 million in the next five years, and tourism is growing 10% annually.

Cairnie has an eye for seeing an opportunity across borders and mapping the route to realizing its rewards, and skill he developed during his former career as an international art broker. Now he recognizes the value in a good franchise business model the way others might see it in a Renoir or Van Gogh.

“You wouldn’t expect the CEO of an internationally known franchising company to have previously been an art dealer. But I was and I was an international fine art broker, at the end of the day as wonderful as art can be, there is nothing quite as exciting as a living, breathing, dynamic franchise business,” he said. “I learned a lot from the international art brokering business in terms of different markets and different cultures, which I think hold me in good stead for franchising internationally.”

Cairnie, whose passport I imagine has more stamps than McDonald’s in Europe has Royale burgers, lives and works between London and Kiev, Ukraine. He came to Kiev four years ago by way of eight years in New York, after being invited to visit by a franchise lawyer.

“I had been previously to Moscow and to Bucharest, but it had been a gap of about five years since I’d been back to Eastern Europe, so I came out to Kiev and I was just amazed at the opportunity,” he said. “Even today in Kiev there is a marked absence of many of the leading US food retail service brands, so I repeatedly revisited Kiev and the surrounding markets like Armenia, Georgia and Russia, and decided to establish an office here to really service the East and Central European market of 500 million people in 30 countries. Now four years later we have just finalized the formation of the East Europe Franchise Association.”

On a personal note, Cairnie is excited that Kiev is home to his soon-to-be family of three.

“My wife is from Kiev. We have a baby coming in 3 months, and I absolutely love it. It’s a wonderful part of the world. It was under the cloak of a Communist dictatorship for 70 years, and it’s now free, open, and very keen to catch up with the rest of the world. I do find generally that people are very cultured, educated, polite, and very interested in the rest of the world.”

Contact Paul Cairnie at paul@worldfranchiseassociates.com.

Rebecca Patt is an executive recruiter for the restaurant and food service industry. She can be reached at rebecca.patt@wraysearch.com.

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