Global Franchise Issue 10.1

Economic uncertainty is a reality in Latin America, where political shifts, inflationary pressures, and fluctuating currencies create a dynamic and sometimes volatile environment. For franchise executives operating globally, understanding how to build resilience in this region is not just strategic – it's essential for long-termgrowth. Latin America presents a paradox: while short-termvolatility can create operational challenges, the region’s long- term fundamentals – a young population, urbanization trends, and risingmiddle class – offer immense opportunity. Franchises that thrive here recognize that volatility is not an exception but part of the operating environment. Success comes not fromavoiding risk, but frommanaging it intelligently. Franchisemodels that performbest in Latin America are those that empower local partners. A rigid, one-size-fits-all approach often fails under economic strain. Instead, flexibility is key. Pricingmodels, marketing strategies, and even product offerings must adapt to local realities. For example, in times of currency devaluation, offering value-based options or smaller, more affordable packages canmaintain customer loyalty without compromising brand equity. Franchisees on the ground are the first to feel shifts in consumer sentiment. Investing in strong franchisee relationships through transparent communication, shared resources, and training is critical. Local operators should be empowered to make quick decisions in response tomarket changes, backed by a franchisor that provides strategic guidance without bureaucratic delays. Building operational resiliencemeans reducing exposure to economic shocks. Companies that embed agility into their operations are equipped to respond, recover, and even capitalize when conditions shift. Despite global headwinds, Latin America continues to chart a path for sustainable growth. Marcel Portmann , director of Global Development at Duck Donuts explores how the region is defying expectations. THE LATIN AMERICAN PARADOX How ambitious franchisors should seize the moment T R A I L B L A Z I N G E U R O P E : When people think of franchising, they often envision mega-systems like McDonald's or Starbucks. But the heart of our industry lies in the thousands of smaller, passionate franchise systems. These brands – with 30, 300, or even 700 locations – are built not just on capital, but on the dedication and entrepreneurial spirit of local owners. As President of the European Franchise Federation and founder of Bodystreet, a global leader in EMS boutique fitness, I’ve seen first hand how bold new brands can be. I understand their ambitions and struggles, and I firmly believe that Europe should be their first step in international expansion. Let me be clear: I have great respect for the large American franchise giants. Their global reach and success are impressive. However, this message isn’t for them. It’s for the thousands of European brands — the ones armed with vision and purpose, ready to grow. For them, the journey doesn’t begin in the U.S. or Asia; it begins right here, at home in Europe. For franchises that manufacture or trade goods, crossing oceans can bring complexity. But most franchises export something more valuable than physical products — they export know-how, systems, and brand identity. In this regard, Europe is the perfect place to grow. Despite the rich cultural differences, we share harmonized legal frameworks and similar economic standards across borders, reinforced by the European Franchise Federation (EFF). When Bodystreet expanded beyond Germany, we didn’t go straight to the U.S. or Singapore; we focused on Europe. We went to the UK, Italy, Luxembourg — and nowwe’re preparing for France. Some might say destinations like Tanzania or Florida sound more exotic — and yes, we proudly expanded there as well. But our smartest moves were made in Europe. Why? Because travel was easy with short flights and no jetlag; we shared business hours and legal standards; we were able to offer local teams training and support, and, crucially, benefited from cultural nuance within a familiar framework. This approach is one I recommend to all emerging European brands: expand regionally, Matthias Lehner, President of the European Franchise Federation (EFF) and Founder & CEO of Bodystreet, believes that true growth comes from building brand loyalty – something that can’t be achieved by a growth strategy lacking depth and direction. 50 GLOBAL FRANCHISE Issue 10.1