The Canadian Franchise Association (CFA) is celebrating 50 years as the authoritative voice of franchising in Canada, and as we look back, it’s clear that CFA and Canadian franchising have evolved in many ways over the past five decades.
When CFA got its start back in 1967, the goal was to bring members of the franchise community together to share best practices and represent Canadian franchising, and franchising was a relatively new business model. Now, CFA has grown to more than 700 corporate members nationwide, serving the needs of franchisors, franchisees, and anyone considering franchise opportunities.
Franchising is also now an established business model that provides entrepreneurial Canadians with the chance to realize their dreams of owning and operating their own businesses. Franchising has a big role to play from coast to coast, with more than 78,000 franchise units across the country, and more than one million Canadians directly or indirectly employed by the franchising industry. Canadian franchising also generates approximately $68 billion every year.
We asked one of CFA’s biggest assets – our members – for their perspective on how franchising has changed in Canada over the past decades, the importance of franchising in Canada, and the role CFA has played in helping them to grow their franchise businesses.
Here’s what they had to say:
“Franchising has grown dramatically in Canada over the past 50 years, and has been dramatically upgraded through technology. Franchising has also spread into many more fields of enterprise, and with that growth, has become more visible, and has attracted more scrutiny. With that in mind, all franchisors need a unified voice to communicate to government across the industry regarding the legislative and policy issues that impact franchising, and the CFA does great work in that regard. We need to maintain the franchise business model, because it nurtures enterprise and entrepreneurism, and forms the backbone for a vibrant economy.”
-U. Gary Charlwood, Chairman and CEO, Charlwood Pacific Group DBA Century 21 Canada and Uniglobe Travel International
“Franchising has evolved a great deal since I got started with Boston Pizza almost 50 years ago. Our franchise agreements haven’t changed too much, but the environment may have been a bit more entrepreneurial due to the lack of formal structure and oversight from franchisors. This led to challenges surrounding brand consistency and the delivery of a consistent customer experience. These days, franchising has become more rigorous, and therefore the customer experience is better standardized across the entire network.
Growth in the Canadian economy relies on a healthy private sector and, in particular, on expanding small businesses. Franchising provides a way for Canadian entrepreneurs to take the plunge into owning a business, but with the enormous benefit of a proven business model and support system.
Boston Pizza became a member of the CFA many years ago in order to stay informed about best practices in Canadian franchising. It has been an excellent resource in regards to the changing landscape of our industry, and has supported our expansion from Western Canada into a truly national restaurant brand.”
-George Melville, Chairman and Owner, Boston Pizza International Inc.
“The Lunch Lady sold her first franchise in 2001. Since then, the number of concepts embracing the franchise business model seems to have exploded, and with it has come more government regulation. While the industry has changed, the public’s perception of our industry (including politicians) has not. This will be one of the great challenges faced by the franchising industry over the next few years – to educate everyone about the contribution our industry makes to local, provincial, and federal economies.
In a country that is so immense but comparatively sparsely populated, franchising facilitates the successful growth of a business concept by engaging partners across Canada who are interested in bringing a brand to their own community. In a well-run system, it can be local at its best – the phrase ‘be in business for yourself, but not by yourself’ is the foundation for the franchise business model. It guarantees that more businesses will succeed, by ensuring that each franchise partner operating under a brand has access to the tools and knowledge that are needed to build a viable operation.
We were fortunate to be mentored by Mac Voisin at M&M Meat Shops early in our journey. He was a huge supporter of the CFA, and encouraged us to join, which we did in 2003. We are so grateful to the CFA for the opportunity to meet with our peers at the amazing Annual Convention, to benefit from all of the learning forums that are offered, and to be invited to participate in franchise tradeshows.
FranchiseCanada Magazine is an awesome and amazing resource, which supports member brands and educates the public. The CFA website gives Canadians looking for either a new business opportunity or information about franchising a business they may currently be operating a one-stop overview of the industry in Canada, and a concise, easy-to-use directory of brands operating in Canada. I am proud to have been involved with two Franchise Awareness Days – one in Ottawa and the second at Queen’s Park – where we were afforded the opportunity to talk to MPs and MPPs about our businesses and how we are committed to making a better Canada.
We owe so much to the committed direction of Lorraine McLachlan, the skill and expertise of the CFA board of directors, and CFA’s incredibly dedicated staff, whose sole goal is to make franchising in Canada spectacular!”
-Ruthie Burd, Founder, The Lunch Lady
“I have been in the industry for over 40 years, and when I first started, the industry was in the early growth stages in Canada. Franchising has changed since then in a number of ways:
- legal compliance has become very comprehensive;
- litigation has become much more prevalent and complex;
- the leadership of franchisors is much more complex and well-advised;
- technology has become an intricate and essential part of most franchise systems;
- there is now an incredible scope of industry segments that have been franchised;
- the ownership of franchise companies has extended well beyond family ownership;
- international franchising has become a target for many Canadian franchise systems (but success is still unpredictable);
- government and political agendas have led to virtual national regulation; and
- media has shown a big interest in franchise success stories.
Franchising plays a very important part in the Canadian economy. Canada is a nation of many diverse cultures and immigrants. In times of shrinking employment and job displacement, franchising gives many individuals the opportunity to establish small businesses as independent operators, and at the same time, create jobs and business opportunities for others. The general public benefits from the many product and service offerings that are available from franchisees, who, through the business model, are able to operate in both urban and rural communities that might not otherwise support such businesses as independents. And with our proximity to the United States, along with relatively secure business and financial structures, international franchisors are always keen to bring their concepts to Canada, and in doing so, enrich our culture and economy. All in all, it is a business model that has proven to be entrepreneurial, consistent, and resourceful, with a low failure rate, and leading to many incredible success stories.
The CFA is an absolute necessity for anybody in the industry. The association has grown exponentially over the years in terms of services, personnel, events, education, franchisee participation, government relations, and mentorship. I participated in many committees, the board of directors, the executive committee, and as general counsel, where I made many contacts, developed a client base, and wrote and spoke extensively. I believe that the CFA ensures that many new franchisors can get started on the right track, learn how to develop their systems, become educated in legal and business issues, and meet experienced and committed service providers. Perhaps most importantly, CFA has allowed me to meet many lifelong colleagues and friends in all facets of franchising, and to participate and contribute to a youthful, energetic, diverse, and exciting community. There will never be a day when I stop learning from others in the CFA.”
-Frank Zaid, Owner, FRANlegal Support Services
Insight from the 2017 CFA Lifetime Achievement Award Winner
George Cohon, Founder, McDonald’s Canada, was recently awarded the 2017 CFA Lifetime Achievement Award as part of CFA’s Recognition Awards program. The following is an excerpt from George’s acceptance speech, which was made at the Awards Gala at CFA National Convention in Niagara Falls, Ontario on April 3, 2017.
“Before a few words of gratitude, I’d like to first congratulate the CFA on its 50th anniversary. I salute the fantastic work it does on behalf of its many members, and the invaluable support it has provided to McDonald’s Canada over the years.
McDonald’s is also celebrating 50 years in Canada in 2017, so I am especially honoured to be receiving such a tribute this year.
Franchising prompted my move to this country, and looking back, I’m proud to have blazed a trail for the model in Canada. In 1967, while practicing law in Chicago, Ray Kroc agreed to sell me the franchise rights to McDonald’s Eastern Canada, giving me the opportunity to build a business of my own.
Fifty years later, I’m incredibly proud of what we’ve accomplished. And this award is really a testament to the achievements of the McDonald’s Canada team of franchisees and employees who have built our brand.
The incredible success of the Canadian team allowed the business to reach some truly amazing heights, one being the bringing of McDonald’s to Russia (or Soviet Union, as it was then), which I spearheaded, and finally took place in 1990, after over 15 years of negotiations! That was quite a moment.
Many former McDonald’s employees have also gone on to start their own businesses, some as McDonald’s franchisees, and some in other systems. The depth of their success and continued growth is very gratifying, and I’m thrilled to have played a role in helping them pursue their dreams.
I’m also especially proud of our support for the communities in which we operate, and of the philanthropic initiatives I’ve been able to found during my career. The Ronald McDonald House Charities in Canada and Russia, and McHappy Day, have given me an enormous amount of pleasure, and hold a very special place in my heart. Other notable partnerships, such as with Breakfast Clubs of Canada, continue to allow our organization to give back to the community.
The CFA continues to be instrumental in helping Canadian businesses such as ours grow from strength to strength. As members, we undoubtedly owe it an enormous debt of gratitude, and on behalf of McDonald’s, I thank you for your tireless work over the years.
I’ll leave you with a saying we have at McDonald’s: ‘None of us is as good as all of us.’ Honestly, I can’t think of a simpler, or better, way to communicate the power of franchising. Our strength truly does lie in the sum of our parts. Here’s to another 50 years!”