Are Turkish Entrepreneurs A Threat for American Franchisers?

It is a fact that Turkey is not the same country it used to be decades ago.

In the past for instance, Turkish consumers were not offered a hamburger of well accepted and standard quality at alternative locations – like with many Anatolian towns or suburbs.

A decade ago a Turkish entrepreneur had to choose from among foreign franchises where as they now have the option to choose from among local franchises which offer even better business prospects (turnover and profit) for much lower investment amounts.

Although the hamburger market is still led by McDonalds and Burgerking and the pizza market is controlled by Dominos Pizza and Little Ceasar’s many Turkish companies – especially in the dairy desserts and bakery and pasta type of product group – have taken remarkable steps to establish food chain franchisees and gained an important share in the market.

Every year new franchise chains of Turkish origin are coming into the local market to compete with foreign ones.

HOW DID IT HAPPEN?

What did the Turkish entrepreneurs do to make their presence felt in the franchise market in Turkey?

After having hosted many American franchises for so many years, Turks gained a considerable experience in franchising and started to take much more initiative in said sector.

What the foreign franchise chains did when they first entered this market was to make their products available at many alternative spots whether it be big towns or places of smaller scale such as suburban towns.. and indeed with the same standard product and service quality..

That is why they were big success and almost overnight.. Not because the Turkish consumer did not like the Turkish taste any more or was fed up with it..

During said initial period foreign chains did not face any competition from local entrepreneurs because Turks did not have the know-how, the service and marketing experience at the time.

However the situation changed drastically in time and Turkish entrepreneurs started to come along with new franchises as they had then gained the experience and know-how for such operations. Personnel required for such establishments were available in the market then.

They learned that location was of top importance..

Most important of all they were aware that starting a franchise operation required a serious planning and a considerably high budget.

On the other hand entrepreneurs who would like offer products available at foreign chains abroad, prefered to find their own chefs/experienced personnel instead of having to pay unacceptable amounts for franchise fees and target to create their own brands.

That is how success came..

SOME TURKISH FRANCHISE BRANDS  & PROSPECT OF MARKETING ABROAD

Now we can see many franchises offered by local companies such as HACIOĞLU lahmacun (Turkish version of pizza with minced meat topping), ÖZSÜT (dairy dessert and pastry shops), ASLI Börek (Turkish pastry products).

The situation as it stands now is that Turks have learned fast and life might not be as easy for newcomer foreign franchisers as in the past.

Indeed Turks have now started targeting foreign markets as well. The reason being the Turkish kitchen is one of the richest in the World and indeed includes some very unique tasty dishes also suitable for fast food. A good example would be DÖNER which is number one seller in Europaean countries such as Germany and even England.

Some other food products eligible for franchising abroad would be LAHMACUN (Turkish pizza with minced meat topping) and a large variety of Turkish desserts, baklava, lokum etc.

The bottom line is that Turks with required operational experience and know-how today certainly have much better prospects of succeeding in foreign markets.

Editor (Marketing Expert)
BUSINESS TURKEY TODAY

03 July 2011