Some say America is on sale. With the dollar weak against many currencies, foreigners find American businesses are easy to buy. The businesses appear to be selling at discounts in the perception of foreign investors compared to the prices of just a year ago. Foreign investors, banks and buyers are looking at and purchasing all companies, especially franchise companies, because of their ability to sustain economic cycles. Many of these trends are invisible. The Middle Eastern and European lenders adopt new names in the U.S. and invest their monies through private equity and hedge fund conduits. These investments support the markets and provide needed capital for expansion in the U.S. first, and globally as a secondary opportunity. These foreign companies are not investing globally and prefer to invest in our country, the strongest and most promising economy in the world, even to this day.

Rumors of increased bankruptcy filings by franchise chains are probably slight exaggerations. All retail businesses are affected by the current economic cycle, but not as much as retail department stores, for instance. We have not seen the fever of bankruptcy filings by retail department stores like Mervyns and Boscov’s caught by franchise companies. Franchise companies are lighter, flexible and more nimble than other companies, able to adjust their marketing and deploy their assets better than traditional retailers. Distress in the market affects franchise companies in the same manner as other companies, but franchise companies have mechanisms available which are unavailable to others.

Franchisers as Nimble Retailers

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