THE

UNIVERSITY March 11

OF 2015
STRATHCLYDE
MBA PROJECT
The Food Franchise War - A study of the
growing Franchise market within the food
Industry in Dubai which is being infiltrated by
International brands thereby leaving very little
market share for the homegrown brands to
grow.

Kavin LAL UJJAINWALA

Vinay KUMAR PREMCHANDRAN

Year of completion: 2015

 UNIVERSITY OF STRATHCLYDE BUSINESS SCHOOL

MBA PROJECT
The Food Franchise War - A study of the growing Franchise market within the food Industry in Dubai
which is being infiltrated by International brands thereby leaving very little market share for the
homegrown brands to grow.

MACBETH - Kavin UJJAINWALA (201257009) & Vinay PREMCHANDRAN (201286569)

Project Supervisor: Dr. Frank Martin
11/3/2015

Submitted in partial fulfillment of the requirement of the degree of Master of Business Administration of
the University of Strathclyde.
Statement of Academic Honesty

We declare that this dissertation is entirely our own original work.

We declare that, except where fully referenced direct quotations have been included no aspect of this
dissertation has been copied from any other source.

We declare that all other works cited in this dissertation have been appropriately referenced.

We understand that any act of Academic Dishonesty such as plagiarism or collusion may result in the
non-award of a Master’s degree.

Signed by:

Kavin Ujjainwala

Vinay Premchandran

Dated:

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Abstract

The purpose of this research was to investigate how the influx of international and established food
retail brands, through the franchising distribution method, within the economy of the UAE has affected
the growth of local food retail entrants. Does the influx hinder or support the growth of local brands?

A literature review was formulated after reading through various available journals, thesis and articles.
Literature was discovered which covered the likes of development and franchising food retail brands in
North America and other European countries, however very little literature is written on developing
economies such as the UAE. It wouldn’t be ideal to deduce solely based on the available literature hence
a planned research was undertaken. A gap was identified here as there was no research carried out
which measured the development of home grown brands to those of international food retailers which
are locally governed and controlled by royal families.

We identified players within the market and narrowed down to three key participants who we thought
would provide vital information to uncover the answers based on the three traits of Brand DNA, Core
Product and Social acceptance – Just Falafel (Mr. Fadi Malas), Lemongrass (Mr. Stephane Jacques) and
Mandilicious (Mr. Fayez AL Nusari). We took systematic approach to interview these three clients
keeping our focus on qualitative data rather than quantitative. These primary data collection along with
secondary collected data provided us with deeper understanding of the cultural trends of building brand
equity within this market, how important is differentiating yourself in terms of menu boards even when
you can replicate systems and operations of other international food retailers. In addition to this, we
were able to discuss on how the government is playing a role in empowering the people within the
country to innovate and build ideas, and how the laws, if any, play a role in the franchise business within
the UAE.

Our analysis was broken down to concentrate upon the concept of the brand; it’s USP, the competition
for the brand, and markets. All three brands have distinct offerings, but Just Falafel and Mandilicous are
focused on culturally driven concepts. Just Falafel was even successful in creating a new food category
within the QSR industry as their core product is a Falafel – they have successfully been able to compete
with international retailers due to this. Where Lemongrass is the oldest, as they have been around for a
decade, they have managed to open up to franchising only recently due to its complex operation by
concentrating on a full dine in option and not in the QSR industry. On the flip side, the other two are
highly invested and interested in expanding at a rapid pace through the franchise model.

The UAE has not been at the forefront to create laws governing and protecting the franchise industry
since these are very early stages for the country to experiment with this model. We believe, in the
future an association will be created branching out under the International Franchise Association to
govern such a development and boost the economy further. In conclusion, the three clients supported
the idea of Dubai’s government to welcome and ease the business environment for international food
retail brands as this helped in developing world class home grown brands in light of competition and
knowledge development.

Word count: 23,513

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Acknowledgements

First and foremost, we would like to thank our supervisor Dr. Frank Martin for his disciplined, quick and
profound feedback. He is a devoted professor, who has really taken the time to guide us through the
research. He is incredibly efficient and has an immediate oversight. He taught us the immense value of
building strong arguments supported by facts and data. He consistently showed us that quality
arguments enable identification of patterns.

Furthermore, we would like to thank the participants – Founders and CEO’s – Mr. Fadi Malas from Just
Falafel, Mr. Stephane Jacques from Lemongrass, and Mr. Fayez Al Nusari from Mandilicious who have
given their time in their extremely busy schedules to share their experience and viewpoints. The
extensive nature of the discussion with them proved extremely valuable to the research and motivation
for progress.

Above and beyond, we would take this opportunity to thank our family and friends for being supportive
throughout the years at the University.

The two years at the University of Strathclyde have been great.

Thank you all.

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Contents
1. Literature review................................................................................................................................... 6
1.1 History of Franchising ......................................................................................................................... 6
1.1.1 Where it all began ........................................................................................................................ 6
1.1.2 Models of franchising and their success story ............................................................................. 6
1.1.3 Governance .................................................................................................................................. 7
1.2 Retail Food Franchising ....................................................................................................................... 8
1.2.1 Benefits of franchising ................................................................................................................. 8
1.2.2 Drawbacks of franchising ............................................................................................................. 8
1.2.3 Economic push that caters to growth .......................................................................................... 9
1.3 Retail Food Franchising in the UAE ..................................................................................................... 9
1.3.1 Geographic Placement of the UAE ............................................................................................... 9
1.3.2 International brands VS Local brands ........................................................................................ 10
1.3.3 Adaptability of local operators with an international conceptualization .................................. 11
1.3.4 Laws governing food franchising ............................................................................................... 11
1.4 Summary of Literature Review ......................................................................................................... 12
2. Research Methodology ....................................................................................................................... 14
2.1 Chapter Outline ................................................................................................................................. 14
2.2 Research Philosophy ......................................................................................................................... 15
2.3 Research Approach ........................................................................................................................... 17
2.4 Research Strategy ............................................................................................................................. 17
2.5 Time Horizons ................................................................................................................................... 18
2.6 Collection of Data.............................................................................................................................. 18
2.7 Data Analysis & Ethical consideration............................................................................................... 19
3. Interview ............................................................................................................................................. 21
3.1 Just Falafel......................................................................................................................................... 26
3.1.1 The Humble Falafel .................................................................................................................... 26
3.1.2 Taking on the Big Boys ............................................................................................................... 27
3.1.3 Early Adopters ............................................................................................................................ 28
3.1.4 "Locations need to earned" ....................................................................................................... 28
3.1.5 New Frontiers............................................................................................................................. 30
3.1.6 Government Governance........................................................................................................... 30

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 3.1.7 Conclusion .................................................................................................................................. 32
3.2 Lemongrass ....................................................................................................................................... 33
3.2.1 Too Fast Too Soon ...................................................................................................................... 33
3.2.2 "Everybody is our competition" ................................................................................................. 34
3.2.3 Inside out Approach ................................................................................................................... 36
3.2.4 Government Recognition ........................................................................................................... 37
3.3 Mandilicious ................................................................................................................................ 38
3.3.1 Traditional Roots ........................................................................................................................ 38
3.3.2 A Serious Investment ................................................................................................................. 39
3.3.3 Embracing the Mall Culture ....................................................................................................... 39
3.3.4 Unorthodox ................................................................................................................................ 40
3.3.5 Educating Customers ................................................................................................................. 41
3.3.6 Government Validation .............................................................................................................. 42
3.3.7 The Formula of Success.............................................................................................................. 43
4. Data Analysis and Critical Review of Gathered Data .......................................................................... 44
4.1 Inception/Concept/USP .................................................................................................................... 44
4.2 Competition ...................................................................................................................................... 47
4.3 Markets ............................................................................................................................................. 49
5. Conclusion ........................................................................................................................................... 53
5.1 Earning their spot.............................................................................................................................. 53
5.2 The Key Research Question .............................................................................................................. 54
5.3 India - A Rude Awakening or the Ultimate Equalizer? ...................................................................... 55
6. Personal Learning................................................................................................................................ 61
6.1 Kavin Ujjainwala ................................................................................................................................ 61
6.2 Vinay Premchandran ......................................................................................................................... 63
7. References .............................................................................................................................................. 66
8. Appendix ................................................................................................................................................. 69
8.1 Participant Information Sheet .......................................................................................................... 69
9. Bibliography ............................................................................................................................................ 75

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 1. Literature review

1.1 History of Franchising

1.1.1 Where it all began

According to the website of FranChoice, the origin of the word franchise goes back to Anglo-French,
meaning freedom, liberty, and from Middle French, franchir, to free, and earlier from Old French franc,
free (Merriam-Webster’s Dictionary of Law). The concept of franchising dates back to the Middle Ages,
but it is known to have picked up when Isaac M. Singer, located in New England, saw an opportunity to
route the distribution for his success with sewing machine, through the USA. With this push, came the
necessity of licensing and training people who would own the rights from him for distributing his
products.

There exists a debate for over centuries regarding the birth of franchising, which has recently been
challenged by Michael Seid (Strahota, 2007). According to him there is evidence in relation to the first
ever business concept that adopted the use of the franchise model – printing – which was
conceptualized by Benjamin Franklin. Michael H. Seid identifies documents which make a strong case
that Franklin’s business dealing are parallel with those conducted in franchising. Franchising became the
dominant mode when the economic scene after WWII demanded products and services to quickly grow
in the USA.

1.1.2 Models of franchising and their success story

The credit must be given to entrepreneurs such as Ray Kroc, for McDonalds, and Dave Thomas, for
Wendy’s, who have used the business format franchising model successfully and shown the generation
the value of managing growth of huge corporate empires.

There are different types of franchises that have grown according to the needs of various industries. For
companies such as Pepsi, Exxon and Ford Motor Company, product distribution franchises makes more
business acumen as they simply sell the franchisor’s products and are supplier-dealer relationships. In
such businesses what is important is their trademark and logo, more than its operations and systems to
run a business unit.

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According to the IFA education foundation studies (An Introduction to Franchising) – although product
distribution franchising represents the largest percentage of total retail sales, most franchises available
today are business format opportunities. This type of model does not only use a franchisor’s product,
service and trademark but also the complete operating system and procedure to conduct the business
itself, such as marketing plan and operations manuals. Such business models are a huge success within
the service industries, such as restaurants, car rentals, maintenance, construction, retail and lodging.

Research conducted by the IFA in 2005 suggests that the total contributions to the US economy
attributable to franchised business is enormous– there are more than 20 million jobs created, $660.9
billion in payroll, and $2.31 trillion in output (Welsh et. al., 2011). Another author states that in the US, a
new franchised store opens every about eight minutes as compared to Canada, which stands at every
two hours (Preble & Hoffman, 2006). In the United Kingdom, 35% of all sales are through franchised
organizations (Bellett, 2003; Preble & Hoffman, 2006). Internationalization of business services has
gained momentum in recent years and among the three popular methods by which businesses expand
their market and distribution channels, franchising is the ultimate primary means of foreign market
exploitation, the other two being licensing and distributorship (Petersen & Welsh, 2000).

1.1.3 Governance

With the large influx of franchised units globally, there was a need for legislation and consumer
protections that followed. This led to the foundation of IFA – International Franchise Association – in
1960 as a membership organization of franchisors, franchisees and suppliers with the purpose of
providing help and guidance to the entire industry. This is an important step in the development of the
model as this adopts a Code of Ethics framework representing best practices within the franchise
industry. This led to the creation of Franchise Disclosure Document – FDD – by the Federal Trade
Commission within which a franchisor should share its history, the offices, litigation history, estimated
investments, an overview of the business concept, and a copy of the franchise agreement (FranChoice).

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1.2 Retail Food Franchising

1.2.1 Benefits of franchising

It is estimated that U.S. franchising generates in excess of $800 billion worth of business in gross sales
and represents 40% of the retail trade (Welsh, Alon, Falbe, 2006). For the UK, the total annual franchise
sales would be worth 33.3 billion pounds and make up around 19% of all retail sales (Welsh, Alon, Falbe,
2006). A major reason for the adoption of the franchise model within the community is to support the
growth of economy at a rapid pace as it has proved itself as a highly significant strategy for business
growth, job creation and balance the supply-demand ratio.

From the franchisor’s point of view, the ability to franchise has its distinctive pros. For one, they are able
to expand their service business to relatively unsaturated markets as compared to their competition
that might not be franchising. This is primarily due to the success in standardizing one’s operations and
using the franchisee’s money to invest in the business, completely eradicating the risk factor for the
franchisor. The franchisee also enjoys in this equation as they will undertake the responsibility of a
recognized brand with standard operating guidelines, set customer service and publically accepted &
recognized concept. Operational benefits include, but not limited to, are periodic system wide programs
and promotions, new product innovations and launched as an LTO, superior market research and advice.

With the help of the franchisee’s work, the franchisor has the opportunity to acquire a broad base of
knowledge concerning local customs, market conditions, economic networks, political affiliations and
industry experience of the franchise partner (Welsh, Alon, Falbe, 2006).

1.2.2 Drawbacks of franchising

Franchisors however have to deal with political environment, which may be in terms of legal constraints,
changes in legal environment, bureaucratic conditions, or limited infrastructure to nurture growth at
expected levels. In terms of protecting intellectual property, it might not be an issue when expansion
through the franchise model is within the country. However, globally it could lead to troublesome days
where the concept could be replicated in terms of operations. At the same time, legally protecting
international copyrights, trademarks and patents could be a difficult and expensive affair.

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Franchisees may well not break their head on the development of concept and its operations, however
relationship between the franchisor and franchisee could turn sour if the trust between them is broker
for reasons leading the product development, aggressive marketing, poor research & advice, lack of
training and operational support.

1.2.3 Economic push that caters to growth

The model being successful in the developed countries has a lot of potential in the emerging markets as
they include relatively unsaturated markets, urbanized and highly populated cities for the most part, a
growing youth market, free trade zones, relatively friendly business laws, liberalized markets and
transitioning economies, and a huge pent-up demand for the western style goods and services (Welsh,
Alon, Falbe, 2006).

Politically, the risk is low surrounding foreign investment. The franchisor has the opportunity to acquire
a broad base of knowledge concerning local customs and market conditions, economic networks,
political affiliations, and industry experience of the franchise partner, which can greatly enhance the
possibility of success for both the franchisor and franchisee(s).

1.3 Retail Food Franchising in the UAE

1.3.1 Geographic Placement of the UAE

In our discussion, UAE is considered an emerging market as the country has a lot of potential to nurture
the unique culture, to take it globally and has been in transition. For the past twenty years, the country
has achieved milestones, one after another without an endpoint in sight – with incredible infrastructure
to woo international investments within the economy – from reality, to FMCG and everything in
between. The country has strategically placed itself as a transit destination, with its highly advanced
ports of air travel, road and sea travels, where the east meets the west. In terms of infrastructure, the
country is in development of an advanced railway network connecting the GCC countries.

The Gulf Cooperative Council is a union of political and economic strategies, somewhat similar to the
European Union (Furey, 2007). The UAE is a growing, lucrative marketplace that has recently captured
the interest of the world for political as well as economic reasons (Welsh and Raven, 2006). UAE has
thrived itself on the tourism industry, partnering itself with the biggest names from the western

9
countries and inviting investment in the hotel industries, reality development, food and retail outlets.
The numbers of international brands showing optimism in this economy has been brilliant and been
growing with a rapid pace year on year.

1.3.2 International brands VS Local brands

The success of international brands fairing very well within the country has been due to the control and
ownership by local high net worth value families such as the Al Ghurair, Al Shaya, Al Madani, Al Futtaim,
and others likewise. These family businesses, under the banner of the family name, have been able to
capture, bring, develop and implement international brands at a fast pace which has helped develop the
economy, in addition to the image of Dubai and the UAE. Al Shaya has brought in the majority of the
brands, within the food industry, such as Starbucks, P.F. Changs, The Cheesecake Factory, Shake Shack,
Ihop, to name a few from their stronghold portfolio. With such a strong foot hold of being the Master
Franchisor/Area Development Franchisor within the economy, the recognized and developed brands
would want to partner with them as these family businesses understand the consumer behavior of the
UAE and have funds to promote growth.

UAE is definitely considered a franchise hot spot, with ripe conditions and the demand is apparent.
Taking it one step further and thinking about this situation, the discussion does move on to cultivating
local home grown brands into a franchise model. Thought question: Is it not becoming more and more
difficult for a home grown, culturally driven brand to utilize the franchise model, to grow and compete
with the established and recognized names in the game? A lot of factors affect this question, in terms of
finance, brand recognition, consumer behavior towards becoming a franchisee of a local brand
compared with an international brand where the risk could be lower. However, one can argue that the
opportunity for smaller entrepreneurs in franchising, in Dubai, is a hundred times what it was five years
ago (Mary Ames, 2012). Other thought questions that will be brought up during interviews with key
personnel:

 Where do we see gaps?

 What opportunities does the MENA region offer for exporting UAE brands?
 What tips do established UAE brands and companies have for budding ones?
 How can UAE food brands support each other and take advantage of cross marketing
opportunities?

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  How do we approach brands that have mixed nationality? (Where an expat starts a home grown
brand)
 How do local brands compete with and differentiate themselves from established brands which
are imported on a large scale?
 How do UAE consumers drive the success and demise of UAE brands?
 Does the government have a role to play?
 How does the UAE Company’s law help or inhibit the growth of UAE brands?

1.3.3 Adaptability of local operators with an international conceptualization

Local, home grown brands need to culturally differentiate themselves in regards to taste and menu
engineering, keeping the global view point in mind in terms of expansion and acceptance from the
international community. Emiratis, even though with sufficient capital and entrepreneurial mindset,
need to have the visualization to venture out on their own with a fresh operation or idea, creating
excellence and optimizing for the use of franchise model.

The paper by Aliouche & Schlentrich (2011) develops the first global index of international franchise
expansion that ranks countries according to their attractiveness to US based franchise firms – UAE is
ranked 38th where USA is ranked first, UK the second and Canada at the third position. Within the GCC
threshold, Saudi Arabia is ranked 16th on the index.

The local government understands the preference of local Emiratis, who want to be self-employed and
to diversify from the oil businesses. For the same reason, the government has introduced many
initiatives to support and fund growth of local food concepts such as Wild Peeta (a submarine sandwich
QSR concept) and Just Falafel (a falafel sandwich QSR concept).

1.3.4 Laws governing food franchising

Some Middle Eastern markets have arcane legal systems (Swartz, 1997), as well as diversity in corporate
laws, tax structures, labor practices, etc. (Chaplin, 1998; Preble & Hoffman, 2006). Business ownership
and development in the UAE is affected by legal restrictions on FDI’s and ownership which makes
partnering with local agents a necessity, be it a sole establishment or an LLC (Bassem Nasri, 2013).

11
According to the Dubai Chamber of Commerce, the UAE does not regulate the franchise model as a
different form of business. There only exists a mutual contractual agreement between the franchisor
and the franchisee. The legislative environment is not ready to support franchising, as per Ali (2008).
This jots the question whether or not prosperity of franchising in the Middle East is meant to be limited
to entry of foreign franchises through their area development master franchisors in the region rather
than to creation of local concepts (Bassem Nasri, 2013).Franchising has no dedicated law that
determines the relationship between the franchisor and the franchisee as in the western countries.

1.4 Summary of Literature Review

Franchising has been an acceptable model for over a century in the United States and it has seen
positive growth in other regions across the globe, including the United Arab Emirates. There have been
extensive studies undertaken in the western economy highlighting the importance of the franchising
model within a country’s economy. However, there is lack of studies undertaken primarily within the
UAE market for how valuable franchising can be – not just becoming a master franchisor but also the
opportunity given to the people for becoming a sub franchisee for an international brand or being a
franchisee for a local home grown developed concept. Only one major study has been carried out to
support the discusses in the Middle East, and that has been carried out by Bassem Nasri for his
Doctorate thesis – Emergence of local retail food franchises in the Middle East: The influence of foreign
franchises. As more and more individuals are suiting to the idea of entrepreneurship through a
franchisor-franchisee model, a higher amount of knowledge is demanded in this field of study.

UAE has proved itself of being at the centre of trade and finance, now it is time for the local community
to grow within and expand outside rather than just focusing on bring in developed concept from the
USA or the UK. Retail food franchising in the UAE has been described as importantly developed and
advanced, but only in the sense of successful import of foreign franchises, not the creation of local ones
(Bassem Nasri, 2013). There is a need for creativity, visualization and governing bodies to take note and
start creating a track to conceptualize the idea.

It has also been discovered that franchising in the country is dominated by a small number of wealth,
well-established family businesses. Sub franchising is not a developed concept due to the contractual
agreements between the franchisor and the area development franchisor. Awareness has to be brought
in and adopted by the local residents as an entrepreneurial opportunity – this will affect the

12
development of home grown brands who will be then be able to sell their concept rather than spending
millions on marketing the idea of franchise operated stores. Lack of sub franchising in the UAE has
hardly been mentioned in any of the researched articles which do not denote if it was a possible factor
for local entrepreneurs, instead of working for master franchisees of retail franchise chains, to create
concepts comparable to the imported ones with edges of favorite local ambience and flavors.

One has to keep in mind “The Stakeholder Model”, which was proposed by Welsh & Falbe (2006),
illustrating the international retail franchising in emerging markets from the viewpoint of its
stakeholders: the franchisor, the franchisee, host market, home market, and the consumer. Under this
model, Welsh et al (2006) again had only minor mentioning of the Middle East with no case studies
brought along.

The region witnesses a franchising sector growing at an annual growth rate of 27 percent (Furey, 2007)
world’s largest shopping developments (Young, 2001; Glynis Jones, 2003) relatively high brand
penetration, and retail expenditure compared to highly developed world economies. Despite such facts
describing the importance of retail franchising in the UAE, the gap exists where there is no research
been carried out which measures the development of home grown brands to those of international food
retailers which are locally controlled and governed by established and wealthy families. For this reason,
we have decided to go ahead and gather first-hand information from home grown branded business
owners who have already started franchising locally or internationally, by means of interviewing them.

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 2. Research Methodology

2.1 Chapter Outline

After reviewing the literature and before we jump into considering collection of data and approaching
key clients to answer our questions, it is vital for the research, to understand the concept of research
methodology and apply it to our specific scenario in order to conclude the right path moving forward in
terms of our approach. Defining the methodology is quite significant as this will highlight the path
towards constructing a knowledgeable insight to achieving answers to the research question and
eventually our research objectives. The tools, such as the questions, interviews and scientific arguments,
are used to deduce a theoretical concept; the methodology can be seen as an operational guideline to
get an understanding of the received data (Leedy, 2010).

The economic and social importance as well as the current status of food retail franchising within the
country was covered in the literature review of this research. The fast growth and development of food
retail in general & food retail franchising particularly in this country during the past two decades was
found to have been based primarily on franchises imported from foreign countries, like USA and Europe.
Vast literature and knowledge does not exist for this country, with regards to our questions, and it has
left many questions unanswered. For this reason, it is simply not acceptable to deduce solely based on
the literature available.

This chapter highlights the key insights of research philosophy – positivist vs interpretivist, research
approach – deductive vs inductive, research strategy – survey vs experiment vs case studies, research
type, choices of data – quantitative vs qualitative, and thereafter the data analysis strategy & techniques
(Dr. Knut Hinkelmann & Dr. Hans Friedrich Witschel, University of Applied Sciences Northwestern
Switzerland). Systematic categorization of research will be undertaken according to the dimensions
shown in the figure 1 – the research onion; to answer the mentioned research question and its
proposed elements, hence justifying the use of the respective methodology. The chapter will also
describe sources chosen to collect data, the strategy to analyze the collected data, and its validity &
relaibility relevant around the research question and justify this choice.

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 Figure 1 - The research onion (Mark Saunders, Philip Lewis and Adrian Thornhill 2008

2.2 Research Philosophy

The idea of embarking on this research is to add value by developing knowledge in the field of food
franchising within the country. This is where the term research philosophy plays part. Studying the
existing literature, which is not extensive, we can now assume the relationship between the knowledge
and the process by which it is developed (Saunders, 2012). We personally agree with Saunders when he
states that one philosophy is not better than another. Rather, they are better at doing different things –
depending on the research questions we seek to answer.

Tashakkori and Teddlie (1998) suggest that it is more appropriate for the researcher in a particular study
to think of the philosophy adopted as a continuum rather than opposite positions – this literally

15
translates to at some points the knower and the known must be interactive, while at others, one may
more easily stand apart from what one is studying (Tashakkori and Teddlie 1998:26, Saunders, 2012).

The philosophical context chosen to be appropriate as foundation of this study is realism, breaking it
down and focusing on direct realism rather than critical. As management researchers, we believe that
our scientific approach will underpin the development of knowledge within this field and stand true to
the philosophy of realism which states that there is a reality independent of the mind (Saunders, 2012).
As it can be seen from the interview transcript chapter, our core focus will be upon three traits - namely
Brand DNA, core product and social acceptance – these can be further understood only by conversing
with our interviewees who will provide us with a realist scenario, further strengthening our beliefs and
developing our knowledge, of the market. This approach will be of much better value as compared to
the existing shallow literature.

We also believe that the track we will be following with this research also hints at the mixture of both –
the positivist and interpretivist philosophy, as we prefer working with an observable social reality with
our interview list (Figure 2). This will provide us with an indication of the underpinning viewpoint and
thinking of the research methods and the questions used. It indicates with which philosophical mind set
the findings are interpreted (Crotty, 1998). We have decided to use data collection to search for

Figure 2 - Positivist VS Interpretivist

regularities and causalities as a base to create a general picture, which is common for a research in a
philosophical context of positivism (Gill and Johnson, 2010).

16
We are more interested to create a value system by defining ways which can bring about positive
consequences, through this data collection.

2.3 Research Approach

Inductive approach is chosen as the preferred method as this research moves from data to theory. This
is most logical method going forward, due to the lack of literature for the UAE which could’ve possibly
assisted us in deducing scenarios before taking up interviews. Induction approach will allow for a close
understanding of the research context within food retail franchising, the collection of qualitative data
rather than quantitative, for debate, and lead to a fairer – more structured conclusion.

2.4 Research Strategy

The research strategy is on the three onion layers, as shown in the figure above. This forms the research
design, in addition to the research choice and time horizon. Choosing a research strategy was not the
difficult part for us. As we were heading down the path of inductive approach, and we were quite
confident of meeting with our primary respondents, the best suited approach was that of surveys
(questionnaires) and that of informal & in-depth interviews. The copies of these can be found in the
appendix. The questionnaires are designed to be closed ended which would help us read the minds of
our primary respondents before we lead to open ended, discussion based interview questions where we
would have a vast opportunity to dig deep within the current and future franchising scenario - from the
business leaders themselves and also who are active within the industry. The focus would be on
collecting qualitative information from our respondents, in terms of the three traits as mentioned
before.

From an ethical perspective, we will be approaching our respondents beforehand and handing out the
questionnaire & interview questions for them to be familiar with what topics we are primarily
concerned with, eventually giving them the opportunity to make us aware if any part of this interview
process needs to be considered as confidential. This would not only help us achieve informed consent,
but also ease the mind of the research participant, minimizing the potential for distress, which is an
important basic principle of research ethics (Laerd Dissertation). The primary respondents would be
aware of how the data will be collected and stored – primarily through recording the interviews with the
interviewee’s consent and storing them safely on the cloud servers.

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To summarize, the methodological choice is a mono qualitative method.

2.5 Time Horizons

This study describes the phenomenon of retail franchising within the country, during the current period
compared to that of the past and its prospective future. For this reason the cross sectional design is
used. The aim of this study is to understand from the active business leaders within the franchising
industry, how they are changing the shape of brand development and recognition within the Dubai
market – which would help them to build and gain success. As Cohen et al said; a cross sectional study is
one that produces a ‘snapshot’ at a particular point in time.

2.6 Collection of Data

In order to accomplish our objectives of this research, it is important to cohesively integrate the use of
both primary and secondary sources for data collection which can then be our information towards
breaking down and analysis, to widen our knowledge on retail food franchising. Primary research
involves collecting data about a given subject directly from the real world (Purdue Owl). Conducting
primary research appropriately will be key in our thesis as is will help us dig into our research question
with our respondents and eventually greatly supplement the research in secondary sources.

Conducting primary research has to be carried out with care and with ethical responsibility on our part.
The questionnaires will be handed out to the respondents to fill in before the start of the face to face
interview, which will be closed-ended and relate directly to the open ended discussion based interview
questions that would follow. Our main concern will be reliability of the data gathered and if the
respondent would be comfortable to share the findings with us. To make them feel more open about
this research, we decided to hand out the approved ethics forms and questions before we met the
respondent so they would realize the questions are not quantitative where confidential answers will be
demanded, rather it’ll be an intellectual Q&A session which they would benefit from as well. Also
knowing that one of the team members is from the F&B background, it would help to create a debate
over issues and possibly dig deeper within the current market situation.

Primary data will be regarded to display high level of authenticity, objectivity, and reliability, for the
reason that it had not been published nor altered (Alvsson, and Skoldberg, 2000). Balnaves (2001) claims
that primary data sources are seen as authentic sources that represent facts.

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Secondary data collection sources will primarily be the database of HCT library based out of the UAE,
University of Windsor library based out of Canada, and other scholastic journal articles searched within
Google Scholar. Via these channels, plenty of literatures were read and a handful of those were
considered important within our literature review. As we already concluded that there was not enough
studies carried out within this research topic, concentrated within this market and hence primary
research will play a key role in decoding the research questions and arising with deeper fundamentals to
why retail food franchising has grown enormously within the past few years in the country, and what
excites the consumers with this model. According to Schwandt (1997), secondary data gives good insight
into the topic of the research and broadens the contextual knowledge for this study. Even though, the
secondary data is less focused around the objective, it is considered to be equally significant for the
research (Burns, 1997).

2.7 Data Analysis & Ethical consideration

Once the primary data is sourced and stored by the means of recording, it is time to make sense of the
data and learn from it. The key whilst analyzing would be to, to pull out the information that is the most
pertinent to our writing, information that we can highlight and discuss, and information that will support
our findings from secondary data (Purdue Owl). Qualitative data analysis procedures will be undertaken,
allowing us to develop theory from our data.

The only way to deconstruct the qualitative data collected will be to paraphrase and summaries the
hearings from our respondents, categorize them in sub sections and restructure them to a narrative
form, to support meaningful analysis; as transcribing the interviews will be a very time consuming
method and not cost effective. We will be comparing the interview answers within six fundamental
primary questions which are highlighted within the appendix, in relation to pre-defined three traits.

The greater richness of qualitative data and the way that qualitative data is often presented creates
potential ethical challenges. On the one hand, there is the desire, especially amongst researchers to
present qualitative data in all its richness. Failure to do so can not only limit the descriptive and
explanatory power that is on the advantages of using qualitative research designs, but also leads to
criticisms of poor research quality because other researchers cannot easily validate the claims that are
being made. On the other, there is the danger that such richness exposes research participants to

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greater risks since it is more likely that they can be identified through such qualitative data analysis
techniques (Laerd Dissertation).

Research ethics, for us is not an afterthought, and is dealt with by making it part of our dissertation
process – referencing the rightful owner for secondary data collection and providing approved ethics
application, from the University, to our respondents and sharing the approved questions before setting
an appointment for an interview to collect our primary data.

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 3. Interview

During the course of our research in an effort to understand and gauge the ever growing franchise scene
in Dubai we decided early on that our primary methodology of capturing key data to best understand
this dynamic sector would be to carry out personal one on one interviews.

Once this was decided we went through a process of elimination to arrive at 3 key franchise brands to
interview and for this purpose we made sure that these 3 brands will encompass all or a majority of the
below traits to be even considered:

1) Brand DNA – This particular trait was very important for us mainly because to understand the
current growth of any brand we needed to go into its roots, How did the founders arrive on this
concept? Did they see a gap in the market to breathe life into their concept? Has the initial
brand image carried forward or evolved over the period of time to where it is currently?
2) Core Product – This particular trait was the next biggest consideration for us mainly because we
wanted to see how the brand has organically grown from its initial product offering to its
current product offering. For e.g. We all know McDonalds serves burgers but over the years
their menu has changed in order to remain competitive and ensure there is something for
everyone, hence their healthy salad options. What this also proves is that no brand can exist
with only their core products. We wanted to see how innovative the brand was in coming up
with new products to complement their existing line or improve their overall product offering.
3) Social Acceptance – One of the key things all home grown brands require is the support and
acceptance of the social sphere within which they operate in. This determines how successful
they will be when they take their brand out of their country of inception. If you are successful in
creating a solid social ecosystem in your country of origin the chance of you replicating it outside
your country of origin is high, multiple solid social ecosystems is what creates a strong brand
following worldwide eventually translating into brand equity.

Surprisingly we found a lot of home grown brands in Dubai lacked either all or majority of the above
traits. But then we found that it would be considered reckless to do a study on Franchising in Dubai and
ignore Brands like Just Falafel, Lemongrass Thai Restaurant and Mandilicious. All of these 3 brands have
the above 3 traits which we were looking for but what was more surprising was that these 3 brands are
where they are today because of very distinctive Singular focuses within their concepts.

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The following are the 3 interviews which was done face to face, captured electronically and paraphrased
with Mr. Fadi Malas the ex CEO of Just Falafel and current chairman of the board, Mr. Stephane Jacques
an ex commercial pilot who also happens to be the founder and CEO of Living Brands the owners of the
Thai food concept Lemongrass and Mr. Fayez who is the founder and CEO of Mandilicious which is the
newest of the 3 and specializes in serving Mandi a rich Arabic form of cuisine which is mainly comprised
of meat and rice in a quick service format.

All the interviewees were mailed the Interview questions prior to the meeting and these questions are
as follows. Please note that the interview was conducted as a discussion based model wherein the
interviewee having reviewed the questions prior to the meeting touched upon our relevant questions in
an order they chose would best suit our purpose. Due to the bust schedules of these subjects we did not
expect to get an answer for each of the questions but we were able to address each of the sections all
answering our key research questions.

What is the main USP that the local brand in question offer compared to its International competition
and what are the challenges it faced from inception till date? : The key is to identify if the particular
local brand has in fact something unique to offer its customers and did they start the brand with a
goal to franchise or was it something they are using to scale quickly? During the Interview process we
aim to give the reader an insight of the brand and how it came into being and what the owners saw as
a clear gap to breathe life into the brand.

a) Give us a brief history of your concept, how it was conceived up to what it stands for today?

b) When you arrived at this concept did you do so after identifying a gap in this market?

c) When you started the first restaurant was it with the intention of one day converting it into a franchise
model? Or did you plan to grow the business organically, one outlet at a time?

d) What according to you were the biggest issues that you faced when you decided to go with the
franchise model for your business?

e) When creating a new concept with a future plan of franchising it one day what are the basic outliers
one should look into to ensure this model is adopted without disturbing the existing scheme of things
within the organization?

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f) How does an unknown brand take its place amongst the giants like KFC and Pizza Hut and hold its
own? What is that you do differently to attract customers as opposed to the millions of dollars spent by
International brands for customer acquisition? If you can put a figure on what is your average spent on
acquiring a single customer how much would it be, do you see this figure coming down over the next
couple of years?

Who in the eyes of the brand is its biggest competition? The key here is to understand how do they
plan to differentiate themselves in the UAE Market where International brands are represented by big
local family conglomerates for whom marketing and promotional budgets are of no concern and how
the local brand perceives competition, do they consider the competition as a direct threat or do they
feel they have the upper hand? Size vs Agility?

g) A brand like The Cheesecake Factory who have been successfully implementing the franchise model all
over the world have made the move to enter Dubai a couple of years ago and they made the transition
rather smoothly, for a brand like this it's easy to say they came they saw and they conquered, but how
would a brand like yours aim to replicate this success which has taken The Cheesecake factory decades to
achieve within a short period of time and with rather smaller marketing spent?

h) One of the key questions within our research is to find out if the influx of International brands through
master franchisors such as Al Shaya, Bin Hendi making it more and more difficult to create a level playing
field for aspiring entrepreneurs who may have a viable concept but the risk of implementing it and
having to go up against the big players makes it not worthwhile, how did you approach this dilemma
prior to you journey?

i) Amongst the local brands who do you consider to be your biggest competition and Why?

If the brand had opened its doors for the first time in a market other than the UAE will it have enjoyed
similar success? The key here is to understand if the brand’s success is linked to the fact that UAE is a
very diverse and infant market compared to and International market such as the US which is highly
saturated and less diverse market that the UAE.

j) Since you have both owned and franchised outlets do you still sell your product or do you sell your
concept to a potential customer? Have you been approached by third parties to lend your expertise and
business model to start a complementing outlet with a different cuisine to go with your existing concept?

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k)Do you think that your retail concept would have enjoyed the same kind of success that it has in Dubai
if you were in another market? Do you think this has anything to do with the multi-cultural expat
population wherein you are guaranteed to have takers for any form of cuisine?

What are the key lessons that the local brand has derived from the more established international
brands? The key here is to understand how much of a positive influence there has been on local brands
from the influx of these international brands? Are most of the success factors easy to imitate? And
how capital intensive is this exercise?

l) Dubai is the land of dreams and as a result we have seen many a dreams come crashing down
especially in the quick service/casual dining scene during the financial crisis, what according to you is the
biggest pitfalls that an entrepreneur can fall into whilst trying to emulate your success by copying your
business model and maybe just going with a totally different cuisine?

m) How have you adopted the social media scene to positively affect your company’s growth within the
region? KFC has successfully adapted to the social media scene in the Middle East, have you adopted any
practices from a successful campaign like KFC's?

n) Wendy’s the popular burger joint had its operations in the early 90’s in the UAE but closed down and
has recently re-entered into the market with a new look and feel, what according to you is the biggest
reasons why International brands fail even in markets like Dubai where customers have the disposable
income? What have you learned from failures of big brands not only in the UAE but outside of this
market?

How important is brand value compared to sentimental value? The key here is to understand the
consumer; does being a local home-grown brand with rags to riches story give the brand an upper
hand when it looks at campaigning for customers? Does it buy loyalty at some level or is it value for
money vs brand value? How does it aim to reduce its customer acquisition costs compared to its
international counterpart?

o) With the recent announcement of the Mall of Arabia, the world’s largest shopping mall and the 1
million sq.ft. Expansion of the current world’s largest mall the Dubai Mall we can clearly see that Dubai is
going to attract many International brands which means more competition for you, how do you plan to

24
be prepared to meet challenges such as theses and others that may come your way moving forward?
Does Brand recall and Customer loyalty play a key role here?

p) Do you feel that being a home-grown brand has its advantages? Do you think that customers are
drawn to your story more than your product?

q) Brands like KFC and McDonalds don’t give the feeling of being accessible mainly due to their size, do
you think that however big a brand becomes consumers should always feel that there is someone to hear
them out? Being a home-grown brand and considerably smaller both in size and scope in comparison to
your international competition do you feel you are able to adapt to consumer trends more easily? Give us
an example.

Does the Government have a key role to play to foster the organic growth of home-grown brands to
ensure budding entrepreneurs, National or Expats have a fighting chance? The key here is to
understand from the home-grown brands on how they feel the government should intervene to ensure
a level playing field, either in the form of reforms or taxation towards imported brands like in
countries like India and China.

r) Do you feel that the Government should give more incentives to entrepreneurs who create and nurture
home-grown brands such as yourselves? Should they have a more strict policy when it comes to
International brands entering this market making it difficult for home grown brands to grow as the
major locations and the big bucks are with these brands even before they enter the market?

s) What are your thoughts on the legal structure within Dubai for franchisors such as yours? Do you feel
there is a lack of set guidelines which would help local companies such as your operate more peacefully
within the region? Have you faced any issues legally with franchisees and if so how were they dealt with?

t) How would you react to the statement that due to the influx of International brands in this market the
growth of local brands by expats or Emiratis are being affected? In your opinion what can be done to
ensure that local brands are nurtured so that money remains within the Dubai economy as opposed to
International brands taking a big slice of the pie now?

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3.1 Just Falafel

3.1.1 The Humble Falafel

We were fortunate enough to have a one on one personal Interview with the first CEO and current
chairman of the board of Just Falafel Mr. Fadi Malas. He played a pivotal role in the success this home-
grown food brand has enjoyed from its inception with one store in 2007 in Abu Dhabi to its current tally
of 700+ stores signed in 18 countries with 52 stores currently in the process of opening.

Lebanese national Fadi Malas moved to Dubai in 2005 originally coming from a banking background in
London. Malas was approached by Mohamad Bitar the managing director of newly opened up fast food
concept called Just Falafel mainly serving the Arabic street food Falafel with a twist. They had opened
their first store in Abu Dhabi in 2007 when the UAE was in full swing with the property boom and retail
explosion. But it was only in 2011 that Malas joined the helm of Just Falafel as the CEO with the goal of
scaling the business by way of franchising.

“Initially he (Mohamad Bitar) wanted to grow organically one store at a time, mainly because the market
was just recovering from the financial turmoil, but I put together a 5 year plan to have 20-25 stores
under our belt and shockingly to all of us we sold 25 stores in a couple of weeks and since then the
growth was astronomical”, says Malas with a sense of pride in his eyes.

Mohamad Bitar founded the brand with 2 of his college mates with the aim of uplifting an Arabic staple
to the world stage, he was sure that he could do it better than anyone else, how?” Innovation! Says
Malas. “Just Falafel is where it is today not because we were good sales men but simply because we
emphasised from the beginning on Innovation. We wanted our food, our approach and the overall brand
to be perceived as a young, fresh and dynamic brand and as a result we have used social media
platforms such as Facebook and Twitter to elevate the brand to a level where today we have over 2
million fans and have been approached by Facebook to do a case study to show other brands how to
harness the undeniable power of social media to leverage your brand perception amongst your
customers and peers.”

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3.1.2 Taking on the Big Boys

Fadi Malas is not in competition with other home-grown brands and he is aware that industry peers
consider Just Falafel as growing too fast. When asked about his biggest competitors in this space the
answer was a bit surprising given the fact they were a new home-grown concept, “we consider brands
like Subway, KFC etc. as our biggest competitors, we are not competing with them in their food level but
with their business model. Subway currently has one of the world’s largest franchise networks which is
42,000 stores and counting, when compared to them we have a long way to go!” Malas sees global
brands as his primary competition mainly because his vision for the Just Falafel brand is anything but
local. He wants to take this brand to every major city in the world and on the onset it looks like they are
en route to just achieving that.

Malas sees competition from KFC and Subway as a blessing in disguise, he feels that Just Falafel is
complementing the competition by offering a completely new food offering to consumers “We are lucky
to be amongst brands that have more than 50 years of history and brand equity, these are the brands
that drive footfall into major locations and we are happy enough to benefit from this form of attraction
especially for a brand that has been in the forefront only for the last 2 to 3 years”

One of the biggest advantages global brands have over newbies is the low cost associated with acquiring
new customers. A brand like KFC which has a rich history spanning over 60 years their biggest asset is in
the intangible, their brand equity. One can say that it’s worth as much as the business and it will only
keep growing.

Fadi Malas was in the driver’s seat while trying to navigate Just Falafel through the retail jungle to
ensure his brand stood out from the crowd but it was not by spending millions on advertisements that
he achieved this, “If we were to try and match brands like Subway and KFC dollar to dollar it would be a
losing battle and we would be climbing up the wrong tree. We were never in competition with KFC or
McDonalds as we were not selling burgers or fried chicken, we were just a new brand in a completely
new food category and we wanted to be the best in our category, currently we are the No.1 brand in the
world offering Arabic street food with a modern twist. Our success is a proof of that.” Malas also adds
that Just Falafel utilised their first mover advantage strategically by ensuring proper communication
highways were established in the form of social media and PR from the very beginning.

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3.1.3 Early Adopters

Currently Just Falafel has over 2 million fans on Facebook with 750 to 1000 fans being added every day;
this is no mean feat for a brand that just opened its first international store in Jordan only in 2012. “We
are a young and energetic brand and you can see that in everything we do from the way our offices are
designed to the way our stores are designed. In today's fast paced lifestyle people want everything on
the go, be it food or information and it would be reckless for a new brand to assume that they will be
able to reach their message to the masses by ignoring the social media space."

From the onset Just Falafel had planned their marketing strategy to revolve around the online realm,
with catchy designs for their websites and their constant policing of their Facebook pages they have
achieved what even established brands find difficult to understand, they have tapped into the psyche of
the common man by simply establishing a communication network and ensuring that the dialogue is
never one sided.

When asked about the negative impacts of being so active on Facebook and Twitter where everybody
has an opinion which could make or break brands Malas said " we see these sites as free monitoring
tools, we don't use Facebook or twitter only to announce offers or new locations, if a customer is
unhappy with his experience of the brand in some outlet I would prefer hearing about it then and there,
it gives the brand a chance to acknowledge its shortfall and ensure that its resolved publicly. Customers
admire brands with a sense of ownership, everyone is aware that nobody is perfect and mistakes tend to
happen because the experience of a customer is not in the hands of a computer or a machine it's in the
hands of our people and sometimes people make mistakes. This is an opportunity to both teach our staff
what they did wrong and at the same time show the customer that we take ownership for our mistakes.
So if you ask me social media is a blessing for new brands like ours because it helps us monitor multiple
stores in one page and moreover it’s free" laughs Malas.

3.1.4 "Locations need to earned"

"Just Falafel has been lucky enough to be able to grab some of the best locations not only in the UAE
retail spaces but internationally also. Last year we signed up to open stores in Canada and the United
States. In Canada we opened our first store on Toronto's Bay Street which is a thriving commercial and
residential centre that receives almost 100,000 commuters daily" say Malas.

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But Just Falafel did not start with the thinking that location is going to make or break the brand. When
asked about the big players in the market always having the unfair advantage of getting the best
locations in prominent malls Malas had this to say" No I don't feel it's unfair at all, in fact I'm happy that
malls fill their food court with crowd pullers like KFC and Subways. New, home-grown brands need to
earn locations such as Dubai Mall and Mall of the Emirates, it adds to the credibility of brands like ours
once we are in the same food court with these giant brands. If these spaces were not governed and
carefully monitored by the mall managements new brands like ours will suffer when we eventually arrive
there, lest face it it's not cheap to have a store in Dubai Mall and we need to ensure that all our stores
need to be making money from their first minute of business and this is only possible when you are in the
same food court as a KFC or McDonalds."

If we look at Just Falafel we see a company that has a strong brand image that has been carefully put
together, every aspect of their day to day operations strongly revolves around the identity of the brand.
So it would be safe to assume that they have a strong marketing strategy all put together for franchisees
to benefit from the very first day they open their own store right? Wrong! "

"We rely heavily on Social Media for our marketing push mainly because it's easy to see your return on
investment almost immediately, the communication is never one sided and feedback be it good or bad is
almost immediate. We use the same approach for our franchised stores also, we don't have set budgets
every quarter for above the line or below the line forms of marketing, we first analyse the location where
the store is and understand the demographics that this store will cater to and then focus on our
marketing activities which will revolve completely around the location of the store. Sometimes certain
store don't require any marketing at all if it's in a prominent mall location we can leverage from the
mall's marketing push coupled with the pull of customers by other prominent brands like KFC and
McDonalds who are our neighbors"

Malas emphasizes that their marketing activities to support their franchisees is always location centric,
this has worked well so far for the brand thanks to their strong social media presence. Just Falafel as a
brand will continue to ensure that they do enough to be associated with the community in the form of
sponsoring events or supporting good causes. The benefits of these associations will eventually trickle
down to its growing portfolio of stores.

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"Innovation was the cornerstone on which this brand was built and we aim to show that in everything we
do. We ensure that all our franchised outlets outside of the UAE have special menu items that the local
customer in that city can associate himself or herself to. For e.g. when we opened our first store in
Canada the menu featured a local delicacy called poutine and this was followed by offering gluten free
options along with a Californian wrap in our first store in the US in California"

3.1.5 New Frontiers

As mentioned earlier in the interview it's clear that Malas wants to be in the same league as the big boys
like KFC, Subway and McDonalds, which is a tough ask for a brand that has been on the up only for the
last couple of years and in operation for the last 7. Currently Just falafel is present in over 14 countries
after it opened its first international store in 2012 in Jordan and they have 700 stores in the pipeline in
over 18 countries. One might say they will probably catch up to the Subways and KFC's of the world if
they grow at this rate. But Malas is not one to sit and see it grow in America and Europe last year Just
Falafel announced its entrance into the Indian Sub-continent a market where even brands like KFC
struggle.

“I want to be in every country in the world because we are in an industry where everybody consumes
food on the go more so now than ever before. If we can communicate clearly to people what we are
doing as a company I'm sure we will be able to find likeminded people in every country who are willing to
take up the challenge, moreover we are not offering another sandwich or fried chicken it is a food
category which is new and there is a huge element of innovation behind it. Most of the other food
categories have been commoditised already and over-consumed and over-available" Malas asserts.

When Just falafel started the founder Mohamad Bitar had a vision to grow one store at a time but after
the arrival of Fadi Malas who took over as the CEO of the company Just falafel has witnessed
unprecedented growth. By adopting the franchise model Malas was able to double the growth of the
brand. “If you ask me did we have a 5 year plan, yes we did, but did we look at it every day? No we did
not!

3.1.6 Government Governance

In the last part of our interview we touched upon the levels of involvement that a local brand like Just
Falafel would like to see from the Government. Dubai as a franchise market is far less advanced when

30
compared to the US. The main contract is always between the Franchiser and the Franchisee and each
franchisee operates his/her store under an individual trade license registered under the Dubai
government.

The franchise model works well for Just Falafel because a majority of their stores apart from a few key
proprietary stores are owned and managed as individual businesses by owners who want to see their
investments make a profit. "There is always an individual who comes along and sets a high benchmark
for his store and this is constantly increasing and it allows us to showcase these individuals to the other
owners, this is how we currently set our KPI's as every market is different and every individual is driven in
their own way"

When asked how the Dubai government can help local brands match up with the International brands
Malas said “The Dubai Government has setup the perfect platform for any entrepreneur, they did not
setup one free zone, they setup 20. They promote entrepreneurial spirit amongst the expats and the
locals equally, this is a tax free haven and you have over 200 nationalities living and working here in
harmony. If you cannot succeed here then every other market will be 10 times harder."

*Malas feels that the strong government governance of the franchise markets in mature markets such
as the US is associated with the fact that firstly it's a country with taxes and the franchise market
contributes a significant amount to its GDP (approximately 3.1% in 2014 as per the IHS Economics report
for the International Franchise Association which accounts for over $ 494 billion) and when the UAE
market hits these figures then it makes sense in monitoring this sector and if there is government
governance at this early stage it will only hamper growth.

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3.1.7 Conclusion

Mohamad Bitar had a simple dream to bring a 1000 year old recipe to the 21st century, he met Fadi
Malas whose dream is to take this 21st century brand to every country in the world together they are a
match made in heaven with 700+ stores in 18 countries one would say that they are on the right path.

So the question is what is the secret to their success?

“Just Falafel's success has been the topic of many discussions and I always tell everybody the same thing,
we chose a food category where nobody was invested in, we communicated clearly and efficiently to our
potential customers and kept at it and finally we started when the global credit crunch hit which allowed
us to enter with probably half the cost it would have taken otherwise and this built a good foundation for
our growth and obviously everyone had to eat." Malas closes the interview with these words.

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3.2 Lemongrass

Lemongrass was founded in 2002 by ex-commercial pilot Stephane Jacques. Hailing from a family of
entrepreneurs from Luxembourg he came to Dubai, UAE as a commercial pilot for Emirates airlines and
after a successful tenure of 13 years with them he decided to enter into the F&B space with his Thai
casual dining concept Lemongrass.

"I had no experience whatsoever in the F&B sector when I started Lemongrass in 2002. I initially dabbled
in the retail sector but soon found it too complicated and started Lemongrass. I opened the first
restaurant with the aim of franchising it later on but as you can see we have just franchised our first
store 3 years ago, this is mainly due to the fact that I learned that it is not easy to franchise Thai concepts
due to which you don't see many Thai franchises available in the market."

Stephane was just like many of the expats in the UAE who came here on a contract and decided to stick
around mainly due to the multicultural environment and the open market appeal for SME's. One of the
key things to understand about Stephane and his Thai concept is that they are worlds apart when you
compare it with "Just Falafel" our last interview. Just Falafel is the true rags to riches story with a fairy
tale ending. Mohamad Bitar and Fadi Malas have taken a simple concept with one store in Abu Dhabi in
2007 to 700+ stores in 18 countries in less than 7 years whereas the story of Lemongrass is a bit
different. Stephane's concept was more complicated in terms of the core product compared to Just
Falafel. The style of management was totally different. Malas with Just Falafel concentrated more on
developing the Franchise model whereas Stephane's priority was to create the menu and worked his
way outwards. Which of these styles works best? The question we need to answer is did either of the
food concepts fail?

3.2.1 Too Fast Too Soon

If Just Falafel's mantra was Innovation then Lemongrass's was Consistency. Both these qualities are
required for a brand to be considered good enough to be franchised and replicated in other markets. In
our interview with Stephane our understanding of this market was questioned because here we have a
successful Thai concept which has been in the market for over 12 years and even survived the credit
crunch but with single digit stores under their belt whereas a young brand like Just Falafel has seen
exponential growth in a quick period of time.

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“I was a bad student of marketing and I never understood the value that social media added to my
business. In fact you can say that we maybe in the last 3 years have started exploring this space because
it's getting more difficult to be without a Facebook page, just like 20 years ago when businesses did not
see the need for a website and today its part of your corporate mix. We were very slow to utilise the
social media space and maybe that was my mistake."

Stephane was also intrigued by the speed in which a new brand like Just Falafel has grown so fast within
such a short amount of time but he feels that their main revenues are from store signings rather than
performing stores. “We wanted to expand earlier on but the cost was just too much mainly due to the
fact that our food cannot be served in a quick service manner and the dishes need to be made then and
there. Our product was not just the food but the authentic ambience which just adds that extra touch on
top of the already good food. As I mentioned earlier we aim for consistency and top notch service and I
felt that this would be hard to achieve in a food court setting."

Almost 80% of the signing fee for a new store has to go back into opening the store as is with any
franchise concepts, Stephane feels that brands like Just Falafel might look good in the short run but the
requirement of being constantly innovative is far more difficult than aiming to be constantly consistent.
Stephane is happy to grow Lemongrass at the slow pace because the day he decides to expand at the
rate Just Falafel has done he won't have to leave anything to chance. “I have learned everything I know
through trial and error and I'm glad I did. My focus has been to improve the consistency in all my stores.
Customer expectations have to be met because the Green Curry in my Lamcy store should taste the same
as in any of my other stores, this is easy in principle, but much difficult in practice as we don't precook
anything because we don't have a central kitchen and everything is made fresh on the day"

3.2.2 "Everybody is our competition"

Lemongrass has been in the market for over 12 years now and identifying your competition would be an
easy task but Stephane explains why he has no clue as to who they are. “If you ask me to pick a few
names as our competition that would be impossible. I would say that any operator who puts in the same
passion and attention to detail as we do on a daily basis can become a threat, be it Thai cuisine or any
other cuisine, in essence every such operator is our competition" Stephane goes on to say that the
biggest advantage brands like his have is the fact that there is always enough people to want Thai

34
cuisine any given night thanks mainly to the majority of Asian population in the UAE and any Asian
cuisine will succeed if its managed properly.

The next question at this stage of the interview was to understand how Lemongrass had managed to
stay in the game for so long without any major marketing spends or no discount offerings for the last 12
years? “I made a conscious decision from the very beginning not to tie up with companies like Groupon
or Entertainer to give customers discounted offers or 2 for 1 offers mainly because as an owner I will be
discounting my brand to get more customers, I don't want customers who will only come during such
promotions, our prices are very nominal and these are the prices that people have come to expect to
receive good food in a good ambience in Dubai."

Stephane was not hesitant to comment on the core research question addressing the unfair advantage
and privileges a global brand enjoys whilst entering into the Dubai F&B sector

"Thai home grown concepts are very limited in Dubai mainly due to the complicated nature of the
cuisine, Restaurants like Blue Elephant which is another Thai concept from the US are only located in five
star hotels and they are not our competition mainly because they serve to a different price bracket. Yes, I
do feel that big brands are always considered over home grown concepts like ours as malls use these
brands to increase footfall and they are also given totally different rental agreements and other perks.
Which is why we more often avoid malls and it's only now that we have opened at Yas mall in Abu Dhabi
and Al Ghurair mall in Dubai. Thanks to the name Lemongrass has created in the past decade we were
able to tie up with a prominent Local family who are now helping us open more doors. I'm still of the
belief that Lemongrass does not need to be in a mall to operate successfully and our first location next to
Lamcy plaza proves this point" explains Stephane.

Stephane prides himself for the experience that Lemongrass offers to its customers. Lemongrass has
become an household name in the UAE as a premium spot for enjoying Thai cuisine in an elegant casual
dining setup. Lemongrass imports all its base sauces from a single supplier in Thailand and these are
especially made for them. “All are sauces arrive from Thailand and there are standardised procedures for
each recipe that need to be followed step by step. We made this process because each time an employee
leaves us we wanted to ensure that they don't end up affecting the consistency of a dish. Now we have
an ERP system which is accessed by our chef's to ensure every dish follows the steps and thanks to our
sauces we are able to achieve a very high standard when it comes to the consistency in our dishes which

35
ever restaurant you are at with the added bonus of being to train new employees to better understand
the methods of preparing a particular dish."

3.2.3 Inside out Approach

It would be fair to say that Stephane had taken his time to ensure that Lemongrass was a worthy
investment for future potential Franchisees, but did Lemongrass miss the opportunity in establishing
themselves much earlier to have been able to use their first mover advantage? Stephane thinks
otherwise “When I started Lemongrass I had zero experience in the F&B sector and my skills as a
marketer was also limited so I ensured that if a customer was coming into Lemongrass then I'm going to
make sure that they get the most genuine Thai food in a good contemporary Thai inspired setting. So
very early on we spent a lot of our time and efforts in perfecting the menu, the decor, hiring of Thai staff
in the Kitchen and customer facing roles. We needed to first perfect the core product offering before we
looked at expanding. "

Stephane adds that if a brand's core product offering is well defined and perfected then the brand does
not need to worry about customer acquisition costs because you automatically end up retaining
customers which is far more difficult to achieve, especially for a brand like Lemongrass which has been
in the market for more than a decade and the Lemongrass mantra has been consistency.

The word of mouth form of marketing is what has ensured Lemongrass's success in this region, it's not
difficult to understand this, before the advent of social media platforms such as Facebook and Twitter if
we liked something we would talk about it our friends and family and if you have ever experienced
Lemongrass as a customer it would not be difficult to comprehend this and it also answers why
Stephane had overlooked today's conventional forms of marketing and let his food do the talking.

Nevertheless Stephane understands that Franchisees look to them for marketing support as its one of
their roles even though each outlet has to take care of their own marketing the push has to come from
top. " We have decided to create a fund which will be later distributed amongst franchisees for
marketing and this fund will be derived from annual franchise fees so for us to have a substantial amount
we need to increase our franchise sales. The more stores we open the more comfortable I will be to set
aside this sum."

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3.2.4 Government Recognition

The Dubai franchise market is still in its infancy when compared to mature markets like the US, but the
world's focus is on Dubai because of this very reason, the potential of this market coupled with the open
door policy and other support for SME's from the government. But with the good comes the bad, during
the financial crisis the local newspapers were filled with stories of businesses going bust and owners
fleeing the country to avoid criminal prosecution due to bad cheques and heavy debts. This proves one
thing that as much as Dubai is seen as a paradise for start-ups due to hassle free setup procedures there
is also another side to it which can be unforgiving and things like a bad cheque could land you behind
bars. "Government monitoring of SME's or other forms of business is completely nonexistent mainly
because Dubai is a tax free country they don't see the need to monitor businesses so it would be naive to
think that the government would impose restrictions on foreign brands coming to their soil to do
business, after all its an income for the government also"

Stephane also adds that a brand like Lemongrass needs international brands to thrive in this market.
“Dubai has over 200 nationalities and I feel there is enough business for everyone to take a share of
Nobody is going to eat from KFC or Pizza Hut every day, the days they want something different and
classy they will come to Lemongrass"

Stephane closes the interview by adding that the major role from the government side needs to be
played by the Department of Economics. "The DED needs to recognize SME's like ours who have been
contributing to this economy and upholding the standards to which Dubai is known for today for over a
decade. Recognition in the form of featured articles or awards would be a big boost for the local brands,
apart from this I feel it's always up to the business owner to push themselves to strive to reach the
standards of international brands, competition is always the healthiest form of capitalism if you ask me"

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 3.3 Mandilicious

3.3.1 Traditional Roots

In early 2013 Fayez Al Nusari opened the doors to the world's first restaurant specialised at serving the
traditional slow cooked Yemeni cuisine 'Mandi' in a quick service food court setting.

Originally hailing from Yemen, Fayes Al Nusari was always passionate about his culture and traditions.
He embraced it so much so that he decided to take it up as a career and became a registered German
speaking tour guide, which gave him the opportunity later on to travel to Europe and eventually work as
a destination specialist promoting Yemen to potential in bound tourists.

A foodie at heart the thing Fayez was most passionate about was the Yemeni cuisine, especially Mandi.
Mandi is the most ancient forms of Arabic cuisines which is as simple as it is delicious. Comprising of
mainly meat and rice with spices which are all slow cooked for up to 7hrs depending on the type of meat
in an underground oven. The entire process is very time consuming and often is a labor of love which is
why nobody fathomed bringing this traditional cuisine to the 21st century in a quick service setting
where each orders have to be dished out within 10 minutes of orders being placed.

"Mandilicious" the name coined by Fayez is a culmination of Mandi and Delicious "People understand
what the last bit is but they always ask what Mandi is and this part where we begin to sell the brand to
customers who are not familiar with this cuisine." he says with a smile.

One would think bringing one of the most well know forms of Arabic cuisine to the Arab masses would
guarantee success but Fayez found out the hard way that it was not going to be a smooth ride.

Fayez, after his career as a destination sales professional in Europe returned to the UAE to join the sales
team of Majid Al Futtaim one of the biggest mall operators in world. He soon started noticing new local
concepts like Just Falafel and Shawarmanji who have taken popular Arabic Street foods and branded it
suit a modern mall environment and more fascinating was the fact that both these brands were built to
scale due to its franchise model. It is at this time he noticed that nobody was selling Mandi in this
fashion and three years on Mandilicious is 8 Outlets and growing in the UAE market with landmark
master franchise signings in KSA and Kuwait. Interests from Muscat, Canada & South Africa are being
considered also.

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"When I started pursuing this dream of bringing Mandi to the 21st century my friends and colleagues at
that time thought i was crazy! But I decided that if I'm going to do this I need to do it right the first time
and ensure that nobody else will be able to copy this."

3.3.2 A Serious Investment

Today if a potential Franchisee wants to invest in a Just Falafel store it would cost them in excess of
AED100,000/- as a signing fee and for Mandilicious it would cost a minimum of AED 3 Million! Fayez has
a method to his madness. “I wanted to ensure the barrier to entry was really high as this was a very easy
format to copy. I decided to use my initial stores in Dubai to showcase to other markets that my formula
works and it works really well."

Fayez does not sell single stores outside of the UAE instead he looks for master franchisers due to the
huge initial investment, because of the complicated nature of this cuisine and the time aspect for its
preparation Fayez decided that for all markets outside of the UAE potential investors should copy their
Dubai model to the tee, which meant setting up a massive central kitchen which has the capacity to
serve up to 20,000 meals and service up to 25 stores in that region per day. “This not an investment like
a Just Falafel store where you can experiment with a few thousand dollars, Mandilicious is a serious
commitment and we only look at aligning with such parties especially in our core markets within the GCC
like Saudi, Bahrain, Kuwait & Oman."

He also adds "Franchising was the only way for Mandilicious to grow so when we started we ensured
everything was suited to this model. We were lucky to have brands like Just Falafel to learn from even
though our management styles and marketing strategies were different it proved to me that anything is
possible if done properly and with attention to detail."

3.3.3 Embracing the Mall Culture

Mandilicious has a very big first mover advantage and with their current model of operations the barrier
to entry is also very high. Fayez has managed to bring to Dubai some of the best chef's from his
hometown in Yemen including the Yemeni Presidents personal chef. “I wanted to ensure that my
customers both foreign and local get the most authentic Mandi experience. We ensured that all our
cooks and chefs were from Yemen. Some of them have come from villages were electricity and water

39
were absent such is the extent to which we have gone to ensure the authenticity, quality and taste of our
food."

When we asked Fayez about the effects of International brands entering in to the retail market in Dubai
his response was two pronged "I would say that this is both good and bad for new local brands like ours,
When I started Mandilicious my biggest benchmarks for service and quality were derived from these
International brands. I learned that anything if package well, communicated well and executed well
could be a success in Dubai and Mandilicious would not have had this level of standards if I did not have
these brands to copy from. On the other hand I feel malls in Dubai are convinced that they require big
names to pull in the crowds and more often they don't give us a second look. I was lucky enough to get
the opportunity to pitch Mandilicious to Mr Majid Al Futtaim personally but he shot down the concept in
2 minutes!"

Fayez also adds that due to the low standards maintained by traditional Mandi restaurants in Dubai and
the messy nature of their service it is hard for malls to understand how we will be serving this type of
food were people have to eat with their hands and avoid creating a mess in their food courts. It was only
after the first store opened in early 2013 in Times Square Center that the word spread about how
elegantly Mandilicious was able to deliver Mandi to the masses in a food court quick service format. And
as fate would have it Mirdiff City Center which is under Majid Al Futtaim's portfolio of malls contacted
Fayez to open an outlet in their mall. " Getting a call from MAF was one of the biggest validation for me
personally as this says to the world that Mandilicious is a viable and sustainable brand that is worthy of a
place amongst the big players."

3.3.4 Unorthodox

From a business standpoint the way Fayez has progressed with his brand Mandilicious would be difficult
to fathom. As MBA students we are taught that the one thing start-ups should be vary about is high
capital expenses and if this is to be believed then Mandilicious would have been a total write off but
Fayez went about investing heavily on setting up a central kitchen which would even rival international
brands, with a capacity to serve 20,000 meals and service 25 stores every day for 7 emirates. One would
think like Mohammad Bitar and Fadi Malas did of growing the base first and for Just Falafel which has
over 700 stores under them only considered a central kitchen much later.

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“I feel every business has elements which will ensure their viability and sustainability in the market, the
same has to be considered when investing into assets for the business. When I decided to establish our
central kitchen my back up plan was to use it as a central kitchen not only for our outlets but for other
verticals within my business. Today my kitchen caters to almost all the five star hotels in the UAE, we also
do private catering for corporate events, weddings etc. For markets like Saudi Arabia this is a very big
gap, the lack of quality operators have opened doors for brands like ours to enter and fill this void. We
have signed a master franchise deal for 40 outlets in Saudi Arabia with a central kitchen bigger than the
one we have in Dubai. Serious investors are happy to know that their kitchens generate a parallel income
apart from the revenue streams that they have with their stores." asserts Fayez.

3.3.5 Educating Customers

Just because Mandilicious is a niche concept it does not insulate them from competition “When a
customer walks into a food court his decision process is more of an elimination process. If somebody
decides not to have rice today then outlets like ours, Shamiana the Indian outlet and Chinese outlets are
quickly eliminated. But if they decide to go with rice then we have a good chance of winning his purse.
On an average I would say we have a 5 to 10% chance of converting a customer when he or she walks
into the food court."

Mandi traditionally is considered a rich food in terms of calories but Fayez has ensured that their meals
are 26% less in saturated fats and 30% less in Calories than a traditional burger meal from MacDonald's
or Burger King. “We are the first restaurant which approached Dubai Municipality to willingly do a food
count for all our meals; we paid in excess of AED 3000 to the central lab to give us an exact nutritional
count for each of our combo meals. This is not a mandatory requirement but we wanted to show our
customers that our food even though contains rice is a much healthier option than the fast food options
available. Our meals are a maximum of 400 calories and everything is made from fresh ingredients and
none of our food is frozen. We have a number one certification from the Central Lab." he says with a
sense of pride.

Marketing strategy for Mandilicious is very different when compared to Just Falafel. “I was a marketing
and sales professional before starting Mandilicious and I'm very much aware of its importance in
developing a brand like Mandilicious which requires a lot of customer education, but I could not get into
hardcore and fully fledged marketing for Mandilicious like Just Falafel who built their brand through

41
targeted marketing strategies. Mandilicious like I said before is for serious investors and it requires very
high initial capex hence I decided that we stay away from the common marketing avenues like social
media platforms or advertisements etc. We do have some presence on social media platforms but this is
mainly to communicate with our customers but I did not want to put too much effort into this as my
clients are all B2B."

Fayez knew very early on that Mandilicious has to be communicated well to his customers due to the
core nature of the product which has deep roots in Yemeni tradition. “I knew that I needed a different
medium to educate my customers, if you take KFC for e.g everybody knows that Col Sanders cooked up
his first batch of chicken with his secret spices but at the end of the day it's just fried chicken and Col
Sanders is used for brand recall. So we decided to create 'Nawaf' a 10 year old local Arab boy who goes
about sharing stories of our cuisine and other tradition to make kids and adults understand the roots of
Mandilicious and where we come from and today 'Nawaf' is our Col Sanders."

Fayez was spot on with creating 'Nawaf' because he was suddenly able to communicate clearly across
borders to potential business partners who wanted to invest with Mandilicious. Fayez currently has
offers from business houses from Canada and South Africa who would like to take this brand across
borders. “At the end of the day our cuisine is only rice and meat, and who doesn't eat rice and meat?”
Fayez adds.

3.3.6 Government Validation

Fayez as many of the expats in the business community echo the same gratefulness towards the
amazing infrastructure created by Dubai for entrepreneurs but he feels more needs to be done.

"The mall culture is a growing one especially in Dubai and we have just entered into this but getting a
space in one of the prominent mall was never an easy task especially if you are not a KFC or Burger King.
We were always met with high costs and our options to choose from in terms of location were rubbish as
we were a local brand. Why can't malls dedicate 10% of their leasing space to foster viable and
sustainable local brands with a proven track record? Make a CSR program out of it."

Coming from being a marketing professional specialising in promoting destinations Fayez feels that the
Dubai government should promote brands like Just falafel and Mandilicious through their partners like
Emirates and Etisalat who already have a strong network world wide and in return the brands can

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promote Dubai as a destination through their foreign outlets in North America and Europe. "In the end it
will always be more beneficial for the government as they create a new network to reach new
customers." adds Fayez.

3.3.7 The Formula of Success

Mandilicious the brand so far in our understanding has broken all rules of business common sense.
Fayez has created a concept which looks like it won't be a runaway success on paper but here we are 3
years on he has proved that with pure determination, attention to detail and basic entrepreneurial
instincts anything is possible. Fayez has created multiple revenue streams from his business model
ensuring the brand is protected; interests from potential investors are carefully studied before Fayez
adds them to his growing outlets. "Personally I think one of my biggest achievements with Mandilicious
was that I identified a niche in the market and I built the franchise model in such a way that it will remain
a niche for years to come." Fayez wraps up the interview.

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 4. Data Analysis and Critical Review of Gathered Data

Post our interviews which was carried out in a discussion format which touched on key aspects of the
research questions the following are our analysis for each of the 3 brands; Just Falafel, Lemongrass &
Mandilicious

4.1 Inception/Concept/USP

Just Falafel was a labor of love of entrepreneur Mohammad Bitar and his colleagues. Initially this simple
concept opened with a stand-alone unit in Abu Dhabi with aims to grow organically but this all changed,
when Fadi Malas took over the reins of the brand in 2011.After a complete repackaging of the brand
Fadi grew the brand from 1 store to 55 in less than 3 years with another 700 stores in the pipeline in
over 3 continents. Just Falafel was a brand which embraced the social media boom and started to
consistently build a fan base. Their biggest advantage was the word of mouth which eventually added to
their brand equity. The main USP of Just Falafel is the level of innovation with which they have taken a
simple food concept and converted it into an international brand. They carved a niche for them by
creating a completely new food category ensuring they don't get into a direct competition scenario with
giants like KFC and Pizza Hut. Even though Fadi and Mohammad have admitted that in the pursuit of
growth they have over the years neglected their core product which is the food itself, they are currently
refocusing on the one thing that made them a hit, their simple Arabic street food.

Today Fadi Malas is no more the CEO of Just Falafel but the brand he built has garnered the necessary
momentum to ensure this simple concept remains a force to reckon with for any new entrants with
similar aspirations.

Lemongrass on the other hand was the brainchild of ex commercial pilot Stephane Jacques. Initially
Stephane started the brand with a vision to franchise but soon these plans were put on hold due to the
lack of capital to open multiple stores, instead he set out to perfect his concept and today Lemongrass
has become synonymous with quality Thai food in a casual setting. The key difference between Just
Falafel and Lemongrass is that Just Falafel had chosen a food category which was completely new and
customer never knew what to expect which allowed them to set the benchmark whereas Lemongrass
had chosen a very complicated food category which was well known to customers so it was Stephane's

44
soul mission to ensure he met his customers’ expectations at every step. Just Falafel set the standards
and customer expectations were dictated by the brand.

Lemongrass's main USP was their consistency, having completed over a decade in the UAE market
Lemongrass has only recently initiated their franchise models. According to founder Stephane it took
them over a decade to ensure that their food tasted authentic and delicious every time you visit their
outlet and now they have ensured that this consistency is seen across their different outlets with key
investments in ERP systems and strategic partnerships with suppliers in Thailand. It would be safe to say
that in the casual dining sector, for Thai food, Lemongrass has no competitors simply because the food
category is just too complicated to take up and scale and Stephane took a decade to master this with
Lemongrass.

Out of the 3 brands we feel that Mandilicious is the one brand which will have longevity. Fayez Al Nusari
defied the odds when he set out to start his Mandi fast food concept. The term Mandi and Fast food
rarely go together as Mandi is a Yemeni form of slow cooking rice and meats for over 4 hours on average
for any dish. Fayez was aware that his concept will require heavy investment to take off and a lot of
education of customers. Today to own a Mandilicious franchise in a country, the minimum investment
required is over $1 million, but there is a method to Fayez's madness and as he explains for
Mandilicious to be successful he knew he had to start with a central kitchen simply because Mandi
cannot be cooked in the kitchens of his outlets. Today his 25,000 sq. ft. kitchen in Dubai can cater to 25
outlets within the UAE and produce 20,000 meals a day. He has ensured that he does not waste this
capacity and has signed up with some of the biggest 5 star hotels to cater to them. As an investor you
would be happy to know that income comes in multiple formats with this vertically integrated model.
This was validated when last year Mandilicious signed a master franchiser deal for the Saudi market with
an initial phase of 40 outlets. Saudi Arabia is the biggest market in the Middle East and Mandi is one of
the staples of the region. With such a signing Fayez has opened doors to international markets in
Canada and Australia which has strong Arab demographics.

One of the key USP's of Mandilicious is their Quality and their vertically integrated model which ensures
a strong return on investment over the years, but having said that its only suited for serious investors
and not for aspiring entrepreneurs who want to dabble in the franchise market which we feel might be a
letdown as they will lose a big chunk of potential customers due to this barrier for entry.

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Welsh, Alon and Falbe (2006) researched and stated that franchising in the US amounts to 40% of the
retail trade and 19% in the UK, representing an amount equivalent to $800 billion gross sales and 33.3
billion GBP within the UK. With such huge response within the business franchise format models, this
provides a big push and supports the growth of the country’s economy at a rapid pace and proved itself
as a highly significant strategy for business growth, job creation balancing the supply-demand ratio. This
research shows that business format models of franchising are best suited for F&B retail industries and
that concept of expansion has been undertaken by all of these brands, where not only the trademark
and logo is shared with the franchisees to operate the said business but also its business procedures,
marketing plans and operations are put into action throughout the franchisee pool.

Even though the major influx, within the economy of the UAE, has been that of international brands
from the US and UK, primarily through master franchising (Hoffman and Preble 2003, Welsh, Alon and
Falbe 2006) due to the unsaturated nature of the emerging market – no studies have been found to
directly address reasons and factors of how the influx of such international brands affect the sense of
creating local brands and franchising them onwards. This lead us to a thought question – is it not
becoming more and more difficult for a home grown, culturally driven brand to utilize the franchise
model, to grow and compete with the more established and recognized names in the game?

All the three brands in our research have started with a different note and mind set yet they all are
eyeing towards increasing brand awareness, brand visibility, and brand loyalty by expanding within the
country and into different markets through the proven franchise model, in hope of replicating success of
major food chains globally. The acceptance from the founders is important here - on how they have to
culturally differentiate themselves from international taste and food categories, at the same time having
an eye for global footprint. The founders have rightly struck a note amongst the hearts of the people
residing in the emerging market of the UAE and also transiting through the country. This is the reason
why the likes of Just Falafel and Mandilicious are being recognized internationally and have been
successful in signing contracts of development in the global market.

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4.2 Competition

In our interview with Just Falafel ex CEO Fadi Malas he points out that the brand adopted the franchise
model mainly to compete with the big brands like Subway and KFC who have thousands of stores
worldwide. Fadi wants to have an outlet in every major city and such aspirations don't come without a
sound base for growth. Just Falafel with over 700+ stores in the pipeline has the potential to be the next
big thing but a revaluation of their product mix is definitely required as the founders were caught saying
they are aware that the quality of their food has suffered due to extra focus in their growth rather than
their food. Having successfully created a strong Social Media platform to speak to their customers, Just
Falafel will definitely be able to grow at a much faster rate in the coming years but currently a lot of
work has to be done to ensure that other local brands don't copy their methods and learn from their
mistakes paving a path for new players to enter in to their space.

Lemongrass is a brand with a successful track record of more than 12 years in the region and founder
Stephane has ensured that whatever his brand does, his quality and consistency of the food he serves is
not affected. Lemongrass is blessed with the fact that not many operators chose their food category due
to the difficulty in mastering the Thai cuisine or hiring authentic Thai cooks due to stringent labor laws
coupled with the high salaries demanded by the Thai government for their expatriates in the country.
Stephane has gone through all the hurdles and it's safe to say he has found the perfect balance in
ensuring this brand has the potential to scale quickly in the next 5 years. We feel that Lemongrass will
see a very steady growth in the coming years thanks to the strategic tie up between Stephane and a
prominent Local family conglomerate who have taken over the brand's Franchise business to ensure
they are present in all the new Malls and other retail outlets. A prime example of this partnership
working well is the opening of the first Lemongrass casual dining restaurant with a full-fledged kitchen in
the new wing of the Al Ghurair Mall. The store has just completed 1 year and earnings have already
beaten expectations. We feel that this is just the beginning of many such successful stores for the brand,
thanks mainly to the cautious approach of Stephane and the influence of his new partner to open doors
for this brand to grow.

On a cautious note, Lemongrass has to be wary of new quick service brands like GoThai & PadThai who
have carved a niche as express forms of Thai Cuisine. We feel Stephane has to have an alternative brand
which will help them reach the mall traffic who don't have the time to enjoy the cuisine in a casual
setting and with the announcement of 8 new mega mall in the region we feel this is the right time for

47
Stephane to start looking at this part of the business to ensure that he is tapping on both aspects of his
customer base.

Fayez Al Nusari and his brand Mandilicious has gone about doing things which normal entrepreneurs
wouldn't even think of. Fayez has made sure that barrier to entry is so high that the brand has literally
no competition whatsoever and with the first mover advantage it's going to take a lot of ingenuity and
innovation on the part of new entrants to really worry Fayez. As mentioned in our interview
Mandilicious is not selling single stores to aspiring entrepreneurs who would want to dabble in the
franchise industry, instead the investment and commitment is so high that only serious investors who
have the financial history to take up a master franchise deal are entertained. The concept is simple and
the business model is vertically integrated to ensure that investors who are willing to take the plunge
are rewarded with multiple revenue streams in the form of catering to five star restaurants, catering for
private parties and events all supplied through their central kitchen which is the backbone of the
business. Currently their kitchen in Dubai which caters to all their stores in the UAE alongside the
numerous contracts they have in place with 5 star hotels there is never a period of time that the full
capacity of the facility is underutilized by Fayez. It's this value proposition that has attracted offers from
Canada and the Kingdom of Saudi Arabia. Mandilicious will easily be a market leader within their food
category without a shadow of doubt. Fayez has succeeded in bringing one of the most complicated and
oldest forms of cooking to the 21st century and due to the strong barrier to entry created by the brand
it would be really surprising if they have any competition if at all for the next 5 years.

The UAE has been described as an attractive market for US and European companies in terms of hotel
developments, QSR outlets and retail outlets, as it being an emerging market, is widely untapped
compared to the western saturated markets (Jones 2003). It is a great potential for franchise
development out of which the Gulf area is most lucrative and tempting markets – UAE is ranked 38th on
the global index introduced for attractiveness to US based franchise firms (Aliouche & Schlentrich,
2011).There were other thought questions that popped up during our review for which we had to dig
deeper, such as what and how does the government play a role in empowering young leaders to step
foot within the retail space and boost their growth or how do UAE food brands compete with and
differentiate themselves from established brands which are imported on a larger scale?

Bassem Nasri, 2013 pointed out within his research that the UAE has been described an important
geographic and retail landscape location for importing of foreign franchises but no the creation of local

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ones. Through our research with primary respondents it is well knows that the government of UAE has
provided an excellent retail space, which is continually developing throughout the city with more retail
properties and options opening up for citizens and residents, for foreign investments coming into the
country as well as for local entrepreneurs to have a chance to stand right up with the international retail
giants and offer uniqueness and value, to their consumers, through their product offerings.

To compete with international food brands, studies have shown that it is vital for local grown concepts
to be culturally different, offering a variety that is unique in taste & packaging, and stand with global
food chains such as KFC, Subway, Wendy’s, McDonalds – rather than go against the food category which
they have created and mastered over decades. The secondary research shows that Dubai offers
diversity, urbanization, growing youth market, free trade zones and a massive demand for the western
styled goods and services (Welsh, Alon, Falbe, 2006). This directly impacts the business models
established in the region, the taste of offerings and the fact that entrepreneurs could test their models
for acceptance in the country, eventually impacting the success for both the franchisor and the
franchisee(s).

4.3 Markets

With over 700 outlets in the pipeline in over 18 countries, Just Falafel's market reach is enviable mostly
because the brand is not even 10 years old. Thanks mainly to the aggressive vision of ex CEO Fadi Malas
the brand has been successful in breaking barriers through various social media platforms in order to get
their message out. Fadi Malas's end goal was to be present in every major city and even after his exit
from the company the momentum that he had created still pushes this young brand in to some of the
most enviable locations worldwide. One such location is Bay Street in Canada which is one of the busiest
spots catering mostly to commuters on a daily basis.

The Falafel as a food category is not alien to most customers in fact outside of the Middle East one can
even call it an exotic delicacy. It is a simple food at a very affordable price bracket. Fadi Malas was
successful in launching this food category with slick branding and packaging in a quick service manner to
the world. He ensured that the menu is custom made to cater to different markets outside of the Middle
East and it worked. Just Falafel's mantra is innovation and one visit to their ever growing number of
outlets will prove this. Fadi Malas considers Subway & KFC as his biggest competitors not because of

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their food but due to their business model. Subway has over 40,000 outlets all over the world and Just
Falafel has taken the step in the right direction to one day emulate this kind of growth.

Earlier in our interview with the founder of Lemongrass, Stephane, it was clear that he would have liked
to grow his brand more than what it is today but due to financial restrictions and the arrival of the credit
crunch he put this plan on the back burner. Nevertheless Lemongrass has achieved what most brands
take decades to achieve, they perfected their product offering. It was lessons learnt in the form of trial
and error but the only way a brand can exist in the Dubai market for over a decade is because the
customers liked what they got.

Having completed 13 years in the UAE Lemongrass has currently 2 outlets in Dubai and 4 in Abu Dhabi.
This is roughly a store every 2 years. This growth is understandable due to the complicated nature of the
cuisine and the larger format of operations. Lemongrass prides itself in delivering authentic Thai food in
all its outlets at an affordable casual setting. Currently Stephane and his team are working to ensure that
the level of consistency is kept similar throughout their 6 outlets. This way the customers are assured
that they get the same green curry in Dubai as well as in Abu Dhabi. This is easier said than done. During
our interview, Stephane told us that they have entered into strategic partnerships with key sauce and
ingredient producers in Thailand to ensure that they are able to deliver on the promise of consistency.
Currently Stephane does not have to worry about his chef leaving and resulting in a complete change in
the taste of his food. Lemongrass has also invested in an ERP system which ensures that stocks are
managed well and also that all the staff have access to the recipes for all their main dishes. The ERP
system was developed by Stephane's IT company which he setup to help Lemongrass have more of a
structured monitoring system and today he has achieved this and is offering similar solutions to other
restaurants in the region.

Such key investments into the brand have setup Lemongrass to scale its operation at a much faster rate.
Franchisees can copy the same processes and methods to ensure they manage their outlets in a similar
fashion and with Stephane's IT company available for support, this is a win-win proposition for anyone
who would want to take up this Franchise. Even though Lemongrass has not seen astronomical growth
like Just Falafel we feel the brand is in a much better position that Just Falafel to scale more quickly
having done all the ground work within the next decade.

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Having only started in 2013, Mandilicious is a very young brand. Fayez Al Nusari had a vision to bring the
traditional slow cooked Mandi to the 21st century and it’s safe to say he has done it in a manner that
will be very hard to replicate. Already Mandilicious boasts 8 outlets in the UAE with 5 in Dubai, 2 in Abu
Dhabi and 1 in Fujairah. Initially Fayez was met with a lot of skepticism when he revealed his plans to
open a Mandi fast food restaurant mainly due to the time consuming cooking methods of this particular
food category but he still went ahead with his vision which is now paying dividends. It is a major
achievement for a young brand to already have 8 outlets under their belt without even having
completed 3 years in the region. Mandi was always considered a food category that could only be
enjoyed in one of the many local Mandi restaurants and often it’s a messy affair as the locals prefer
eating with their hands which is a traditional way of consuming this cuisine. Several of the malls wanted
to avoid this messy aftermath and felt it might deglamorize their pristine food courts.

Fayez knew of this social stigma and the way his Mandi was perceived by locals and expats so when he
did open his first outlet everyone was taken aback to see well packaged boxes with nutritional values
and other relevant information all presented in a slick and cleanly designed formats. Today Mandilicious
is the only brand in the world which caters to this food category and it was not a cheap affair for Fayez
to bring his brand to the level it is today. Mandilicious outlets are catered through their 25,000 sq. ft.
central kitchen which ensures food is freshly prepared every day in their traditional underground ovens
by Yemeni chefs who were handpicked by Fayez from his home town in Yemen; such was the attention
to detail which is the key to the success of the brand. Today to become a franchisee of the brand is not
cheap. Fayez explains that for him to be able to serve a Mandi dish within 5 minutes of a customer
placing an order would not have been possible without his central kitchen. Today if an investor wants to
take the brand outside of the UAE they need to be ready to make the similar investments that Fayez had
to ensure service standards and customer expectations are met as result of which the barrier to entry
which he has created ensures that he is insulated from copy cats with aspiration to enter this food
category. This formula was validated when last year he signed on a Saudi group to recreate his business
model in the biggest Arab market in the world with an initial commitment of over 40 stores and
currently Fayez is also in talks with investors in Qatar, Bahrain, Oman & Canada who see the madness in
his methods and we are confident that this is a young brand that will be a force to reckon with in the
next 5 years even more so than Just Falafel who are in the Arab food category.

Franchising business & legal infrastructure has been hardly identified where the UAE government has
recently realized the benefits of the franchise business model (Furey, 2007) and has started to

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encourage franchising, together with the support of franchising summits and events to develop interest
amongst the youth. Due to the emerging status of the country, its lucrative marketplace and its ability to
thrive on the tourism industry, UAE has captured the interest of the world for political as well as
economic reasons (Welsh and Raven, 2006). This, along with the primary data collection, explains why
the geographic location and the offerings of the UAE are of absolute high caliber.

The UAE has managed to strategically place itself at the centre of world economy where people from
around the world are present to see a brand blossom and as Furey (2007) mentions that the region is
witnessing an annual growth rate of 27% within the franchising sector with its largest shopping
developments (Young, 2001; Glynis Jones, 2003) providing high brand penetration. The diversity is what
helps the brand gain traction within the country and have the ability to reach various markets in the
Middle East and internationally towards the UK and America’s. The retail expenditure is currently
equivalent and comparable to high developed world economies (Jones 2003).

The key to the success of the three primary brands researched is that of creating a food category, be it
within the QSR or fine dining footprint, which is culturally inherited which ticks the right boxes for
creating fresh concepts. The country and the laws governing businesses within this market just help
them push boundaries and shake up the food retail franchising market in the region.

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 5. Conclusion

International Brands - A Catalyst or an Obstacle for Growth of the Franchise Industry in Dubai?

When we started our research we went into the interviews with 3 of the most successful local food
brands with the hope that at least one of them would cite the influx of international brand as an
obstacle to their growth but what we gathered after each interview was surprising. Each of the 3 brands
were convinced that they were able to elevate their respective brands to international standards thanks
to the lessons they learnt by observing brands like Subway, KFC etc. Fadi Malas the ex CEO of Just Falafel
said that thanks to brands like Subway they were able to compete with them head on in the food courts.
The mall culture is very prevalent in Dubai thanks to some of the largest shopping avenues being
present here. This has been a key attraction for a lot of the International brands who all want a piece of
the action and due to this heavy influx they set the benchmarks for aspiring local brands such as Just
Falafel & Mandilicious to be even considered an equal and eventually giving them a spot in one of the
many food courts. During our interview with Fadi Malas of Just Falafel he said that brands today need to
earn retail spots in Dubai Mall or Mall of the Emirates but it also does not mean that brands can only
survive if they are in high end retail spaces. Customers appreciate good food and good service, its only
brands that take this to another level through social media engagement and CSR programs that make it
big. Entrepreneurs are spoiled for choice if they ever wanted to learn or emulate a super brand thanks
to the international appeal that Dubai poses anyone can walk into the Dubai Mall food court and see
firsthand how these brands operate on a daily basis.

5.1 Earning their spot

When we interviewed Fadi Malas we went in with the expectation that here is someone who will
definitely have a lot to say about the high rents and the nature of major mall's to overlook local brands
whilst trying to fill their food courts, but instead we were amused at his take on things. Fadi was of the
notion that a lot of local brands have it "easy" due to the ease of access to world class infrastructure
coupled with services which are of international standards, as a result of which its fairly simple and
straight forward for an entrepreneur to set up his/her company in Dubai. The major malls like Dubai
Mall and Mall of the Emirates are aware of this and always require proof of concept or in other words
they require local brands to show proof of successful existence within the UAE. Brands with a proven
track record are only considered to even apply for a vacancy in the food court.

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In most cases these malls have scouts who keep a track of new and exciting brands both locally and
internationally and as soon as a spot opens up these brands are approached with the proposition to
open their doors in one of their malls. A local brand "earns" their spot when you receive an invitation
from the Mall to open your store in one of their newly vacant spots. In most cases Malls offer attractive
perks like reduced rents and smaller cuts in the overall earnings per annum to lure these locally
successful brands. Fadi Malas and Just Falafel took 3 years to "earn" their spot, to earn their right to be
next to a KFC or a Subway and he feels that it is a privilege to be amongst such super brands and lets you
know that your brand has truly arrived now.

Just Falafel, Lemongrass & Mandilicious were all met with obstacles when they initially approached the
big malls to campaign for a spot in their food courts but these obstacles where in turn seen as
challenges to their respective founders. They felt they still needed to work on their brand to be
considered worthy of an outlet in Dubai Mall or Mall of the Emirates. This has driven them to further
improve their operations, customer engagement and their core product - their food. We feel
International brands help local entrepreneurs dream big in manners of positive emulation. If brands like
Subway or KFC did not exist then customer expectations will be low. The International brands have
helped in raising customer expectations and as a result positive enterprises are created.

5.2 The Key Research Question

But this still does not answer our key research question which is if these brands are considered a
hindrance for the growth of local brands? The answer is Yes and No. From our above research it's easy
to identify a positive co-existence between local and international brands so naturally it is easy to
assume that they in fact act as a positive catalyst for growth but being MBA students we are always
asked to question the obvious and challenge the status quo. We feel even though International brands
have positively impacted growth of new and innovative local brands we are vary of the fact that the
balance is still in favor of International brands when compared to the number of local brands in
operation within the local market.

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5.3 India - A Rude Awakening or the Ultimate Equalizer?

Brands like KFC and McDonalds are synonymous with the term "fast food" and are brands which have
taken over the world through their franchise models. In the Mid 1990's both these brands entered in to
the Indian market with hopes of emulating the similar success they have enjoyed for over 50 years in
other parts of the world, predominantly in the US. But both these brands were faced with problems like
they never experienced before. India was under the British rule for over 200 years and after achieving
freedom in 1947 under the umbrella of the world's largest democracy the Indian market was
inaccessible for foreign brands which actually paved way for what it is today, a nation with one of the
biggest economy in the world after China with local brands taking the center stage in all sectors ranging
from Automotive, IT, Retail and so forth.

KFC & McDonald’s were faced with uncertainty due to the ever changing tax policies put together by
ruling parties elected every 5 years. Tax reforms were put in place to protect the domestic economy and
local businesses and before long KFC had to close its operation in India after being branded a "foreign"
corporation whose operation within the country would pave way for closures of local food producers
such as chicken farmers as they purchased their supplies from suppliers outside of India. It was only in
2004 that they resumed their operations in India but this time around they learned from their mistakes
and ensured they spent a good number of years setting up local supplier networks to ensure the
domestic economy also benefits by ways of job and opportunity creation. But still KFC faced the
unknown when it came to tax policies which targeted International brands operating within the country
but being the second largest economy and MacDonald's already having a head start they could not
ignore the market for all its merits.

McDonald's spent the first 6 years after its decision to open up in India setting up a local supplier
network. They ensured that all their suppliers were trained to deliver products with International
standards with a local flair. Jobs and opportunities were created along with a promising supply chain to
ensure that the brand had a good base to grow within the country from. But McDonalds have also
struggled over the years mainly due to their core product offering which are beef burgers and beef is
considered a taboo in India due to religious beliefs marking the cow a sacred creature. In an
independent study done by Technopak in 2001 it was found that over 70% of the Indian population
prefer home cooked meals and eating out even if it’s a chicken Big Mac was reserved for special
occasions such as Diwali or Christmas in addition to this the Indian taste buds found the bland taste of

55
burgers and fries too alien for their liking. MacDonald's responded to this by completely removing beef
from their menus and replaced their beef burgers with chicken and mutton substitutes. They also added
"masala" flavors to their menus along with more vegetarian options to go with their non-vegetarian
combos. But in spite of all these efforts McDonalds still fell into hot water when they got into a long
legal battle with its now former joint venture firm Connaught Plaza Restaurants from whom McDonalds
wanted to purchase 185 of its initial restaurants to redistribute it to its new owners in their network
based in other states but the Indian high court put a stay on this purchase from going ahead and halted
McDonalds from taking the case to an international court for arbitration to protect the investment of its
citizen. This is just an example of how the Indian government ensures that investments and agreements
done on their soil remains intact and seldom do International brands get their way. Due to the court
order McDonalds ended up losing its foot hold and first mover advantage which allowed KFC to catch up
with them. According to a study done by Euro monitor in 2008 McDonalds reigned supreme amongst
the western brands with a total revenue north of Indian Rs. 6.6 billion while KFC lagged behind with
sales of Indian Rs. 1.5 billion mainly because they only reentered in to the Indian markets in 2004. Today
KFC has overtaken McDonalds with an annual turnover of over Indian Rs. 16 Billion.

In 2012 the Indian government under the Congress Party, the then ruling party announced that they are
reviewing a tax proposals in the new budget which would allow the government to back track and tax
foreign companies operating within India as early as the 1960s, this news was met with an exit of over
half a billion US dollar leaving the Indian stock exchange in fear of being liable for large tax amounts. In
an interview with Dr. Pravakar Sahoo at the Institute of Economic Growth (IEG) conducted by the
National Bureau for Asian Research (NBR) in 2012 for the Senate India Caucus reviewing the budget for
the year Dr. Sahoosaid "India will not realize the full potential of outside investment unless the
government confronts political opposition to key policies, such as allowing FDI for multi-brand retailers
like Walmart and Target, and undertakes crucial reforms to sustain investor confidence".

One of the key lessons we can derive from our quick glimpse into the hurdles faced by International
brands like KFC & McDonald's in India is that the role of government however small or big is imperative
for fostering growth in a domestic level. Even though India is an extreme case due to its close door
policy towards FDI, it is still an example to go by. If we stop for a moment and imagine if the Indian
markets were as welcoming to foreign enterprises as much as Dubai is, will there have been companies
like Reliance or Infosys today? "Necessity is the mother of all inventions" - which is also the same for
demand and supply. Due to India's closed door policies towards FDI after its independence local

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companies took in onto themselves to supply to the demands of the nation across all sectors. The Indian
government has always had a tight grip on Foreign Brands infiltrating the economy which has ensured
that the money in the country remains within the country and as a result local brands flourish. Café
Coffee Day is one such example of this, in a world where every second corner has a Starbucks in India
you would find a Café Coffee Day which is the brainchild of entrepreneur V.G.Siddharthahas over 1640
outlets in 29 states in India. One would stop to wonder if this would have been possible if Starbucks had
free reign in India.

Today India is a self-sufficient nation and this is what we as part of our research wanted to highlight.
According to the economic reports released by the Dubai Economic Department it was noted that the
retail sector contributed to over 30% of its overall GDP in 2013-14 and this was set to increase. Unlike its
neighbor Abu Dhabi, oil is not a major contributor to the Dubai economy, tourism and retail is, and we
feel the Dubai government need to capitalize on this opportunity to look at a tax policy towards foreign
companies operating in Dubai and local companies who represent these brands within the Dubai retail
sector. The following is a quick glance at the key elements of the 3 brands which we feel emulates their
international counterparts (next page):

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Table 5-1

The above comparison gives you an idea of the influence and impact International brands have on local
developing brands. These are some of the positives the influx of international brands brings to a local
economy. It develops and creates a platform for entrepreneurs to create the next big brand. But if we
take a close look at the retail sector in Dubai it is always the case that international brands reign
supreme and one would imagine that a lot of the money spent by customers are fed back to the parent
brands operating outside of the country coupled with a no tax policy we feel Dubai is in the losing end
and the playing field is anything but level.

When we interviewed our 3 brands all of them were of the opinion that the Dubai government is fair in
allowing this influx of international brands and that the government has done a lot to promote the spirit
of entrepreneurship within the country. We feel even though Dubai has always welcomed companies
with open arms thanks to their free zone facilities and unparalleled world class infrastructures it should
now start looking further ahead to curb this very obvious leak of money leaving the country. There

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should be strong parameters set in place for International brands wanting to operate within the country
at least to level the playing field especially more so as the Dubai economy is more dependent on non-oil
revenue from sectors such as tourism and retail. A good part of the international brands operating in
Dubai are master franchise deals signed by local family conglomerates we feel that the Dubai
government should incentivize these conglomerates and encourage them to create more home grown
brands and concepts. A taxing policy similar to that of India though not so high to begin with needs to be
set in place for every foreign brand wanting to operate in the country either directly or indirectly
through an agent. A summary of this could be seen in the table below:

Table 5-2

Local businesses are the corner stones of every developing nation as it promotes entrepreneurship and
creates new jobs but having said that the question is whether the market requires government
intervention? Is the income generated directly or indirectly such a big contributor to the annual GDP
that the government needs to monitor it as it is the case in the US where the franchise business is a big

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contributor of its overall annual GDP? According to HIS Economics one of the leading forecasting and
analysis companies in the world in a report created for the International Franchise Association in 2015
they revealed that the gross domestic product (GDP) of the franchise sector will increase by 5.1% to
$521 billion for the US markets. With such income being generated through this particular industry it
would be wise for US government to closely monitor the space especially due to their tax policies. But
when it comes to UAE franchise market which is at its infancy and not as mature as the US markets it
would be debatable whether to setup bodies to monitor the franchise sector? Currently it's just another
form of business activity which thrives in the region thanks to its open door policies and ease of
incorporation for any business and the government is more focused on entrepreneurship and it would
be premature to closely monitor the franchise market but if a tax policy is setup now it would help the
government even the scales and create a better mix of local and international brands operating in
harmony within the region.

We would like to conclude our research by saying that all the three brands which were the highlights of
our study were formed by entrepreneurs who dreamed of one day becoming the next KFC or McDonalds
and so far thanks to the influx of such international brands into Dubai it is paving ways for local
entrepreneurs to create the next big brand as was the case with Just Falafel who in their brief time of
existence are already in over 18 countries, but we feel that the government has still a lot of work to do
in the form of creating a more balanced platform so as to ensure more such local enterprises are
created and nurtured to be able to one day become super brands like their foreign counterparts.

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 6. Personal Learning

6.1 Kavin Ujjainwala

What lured me towards studying the franchise environment within the UAE economy is the growing
interest of entrepreneurship, backed by the governments enormous support towards creating funds and
the foresight of giving importance to innovation & developing young minds, the growing number of
locally developed food & beverage retail brands, in addition to my personal exposure and expertise
within the food retail industry. My personal experience includes managing family developed restaurants,
our own brand, as well as being a sub franchisee for an American brand in the UAE. Management style
between these two concepts are vastly different and has helped me gain fair amount of knowledge
from the perspective of operations, systems, training manuals, costs breakdown between an
international brand vs. local creation of brand and most importantly brand equity.

Now it was time to have a deeper understanding, within the UAE, of what makes an F&B brand trusted
by its consumers, the strategy the founder and the team create, how important is differentiation, how
the influx of international F&B brands impacts the development of locally based food chains and if
franchising is the model these locally created brands chose for expanding their presence, if so how
successful have they been. I was greatly supported by my group member, Vinay, who brought good
ideas to the table, in terms of whom to approach, the lead up of the questions to be asked during the
interviews and later decoding the interviews and understanding the findings.

All the three brands in our research have been personally approached and interviewed to understand
the reason of their existence within the market and the acceptability by its consumers. It was my
personal belief that the people with entrepreneurial mindset would not appreciate the fact of royal
families buying off master franchising rights from international brands and opening successive outlets in
the country. It was surprising to realize that all three founders were in favor of the government’s policies
to ensure world class food retail outlets were established in the country, to develop Dubai as a brand,
and also provide learning & development opportunities to the people who are willing to enter similar
industries. After discussing with them, it did make sense because the entrance of high caliber brands
pushed the entrepreneurs to create different and innovate taste and menus based on local & cultural
food thriving on similar operations to international brands. The level of understanding and knowledge
sharing within the market has been enormous due to this.

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Out of three brands interviewed, both of us came to the conclusion that even though Just Falafel has
taken the top spot for the most number of outlets globally, Mandilicious has truly been an
entrepreneurial stride by Mr. Fayez who had the courage to invest in a central kitchen first before
opening its first retail outlet because he had the foresight of how the operations of his food being
served to each and every consumer would be like. Both Just Falafel and Mandilicous have their menu
developed by local cultural trends as compared to Lemongrass which is a Thai cuisine. Just Falafel
focused on growing rapidly and did not really cater to the quality of food being served, due to which we
believe their brand equity has decreased during recent times whereas Mandilicous is new, fresh,
focused on quality and operations which would boost their brand value and recent agreements to
develop their brands in Saudi Arabia and Canada only suggest they are on the right track to attain their
objectives. The key point taken from this research is that even though the operations, the guidelines,
the manuals, the franchising development method could be replicated what is most important in
developing a truly globally successful brand will be dependent upon how we can differentiate the menu
culturally rather than copying successful menu boards – rather than eating a pie of the cake, create a
new food category which has been smartened and fashioned for the generation Z.

After successfully completing interviewing key figures and understanding the franchise environment
here in the UAE, I have realized that to successfully create & sustain food retail brand equity, and
eventually franchising it forward to gain dominance it is important to understand the cultural taste,
innovate the menu offerings, focus on specializing on one core product and be ready to experiment. It is
important to identify the gaps and build on clear business objectives.

Apart from learning the food retail environment of the UAE, general learning’s have also been gathered
during the course of this project. It took me several months to truly define the research question I will
be targeting at since I knew I had to narrow down exactly what question I needed answers for. The
complete process starting from hunting for and reading various literature, building facts, creating an
outline for research to eventually breaking down the cluster of information and arriving to outcomes of
the research questions has helped me to build strong arguments and have a different POV of the food
retail environment in the UAE. The most differentiating part of doing this project as compared to other
assignments during the course of the MBA was the open nature of conducting research and creating
your own boundaries and constraints to eventually narrowing down the information collected towards
your research question.

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6.2 Vinay Premchandran

Being born and brought up in the UAE I can confidently say that I have literally seen an entire city spring
up over the last 3 decades. Dubai has always been known to do the impossible whether it is building the
world's tallest tower or the world's largest shopping mall. As a child growing up in this dynamic city you
were brought up with the belief that anything is possible and this city has made all of us believers. It
should come as no surprise of the ever existent mall culture in Dubai and as an expat I have had the
privilege of experiencing some of the world's top brands all ranging from fashion to food as a result of
which it was always been a childhood dream of mine to one day own my very own food brand with
stores in some of the best malls in Dubai, but over the past decade I had always found that the big malls
like big names and mom and pop stores which used to be around during my school days suddenly had to
make way for the big brands and before you knew it you had nothing less than 15 to 20 International
brands sometimes all under the same roof but under the master franchise agreement with one or two
big conglomerates operating in the UAE.

And then came along Just Falafel, a local brand which is today in over 12 countries with 700+ stores. This
success story is what motivated me to explore mine and Kavin's hypothesis which is that to be able to
compete with brands like McDonalds and KFC you should either have a lot of money to build your brand
or there has to be a serious check on the side of the government to curb this very evident flooding of
international brands into Dubai. Kavin, who is in the restaurant business in the UAE has explored this
space in the past and has always been met with high costs or unrealistic demands from mall
management in the form of higher percentage of profit sharing and high rents. It begs the question as to
how can one build their own brand in a city which promotes the entrepreneurial spirit in everything it
does? We were convinced that without the backing of a deep pocketed investor growing and developing
a brand was just a pipe dream.

Growing up in Dubai a city of opulence as it is today we felt that family conglomerates such as Al Futtaim
and Al Shaya all had an unfair advantage as they had the financial history to easily take up master
franchise agreements with some of the biggest food brands in the world and before you knew it they
flood the market with multiple stores in all the prominent location making it close to impossible for a
young entrepreneur to create and startup a new brand in the city. We felt that the government should
step in to nurture and incentivise local entrepreneurs who are creating homegrown brands instead of
importing brands into the city. But during our interviews all the 3 brands were of the opinion that the

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government is doing enough to ensure the playing field is level and thanks to the influx of the
international brands it has given them a better insight into what it takes to create and operate a world
class brand. They felt these brands have set a very high benchmark for local brands which all in all works
out to the benefit of the city which is considered by many as one of the top destinations in the world for
leisure and tourism.

Me, personally after our research and analysis of our study I'm still not convinced as I'm aware of the
high costs that is involved to even open a single store in a prominent mall. My assessment of this
situation is that there needs to be government intervention if Dubai wants to create a stronger base for
its growing economy. Local brands and businesses are without a doubt the cornerstone of any growing
economy and I feel that if in the future a situation arises like the financial crisis in 2007-08 Dubai will see
a big drain and slowdown of their GDP as most of these brands will curtail their expansion plans and in
some cases might even lay off people to see better returns. A good example is the banking sector within
UAE, during the financial crisis we saw a lot of the international banks cut their operations and laid off
people to ensure that their International financial outlook was in a better position, it is the local banks
that flourished during this period. Even though comparing the banking business with the food retail
business would seem a bit out of the ordinary but the underlying message was that the government
support ensured the banks didn’t go bust. My recommendation is why not extend similar support for
encouraging local business by way of incentives in the form of subsidized rents, guaranteed spots within
premium mall for at least 10% of their total retail spots and value added taxes towards other business
which bring in International brands into the markets. Foreign Direct investments within the country
need to be carefully monitored by the government like India does. Thanks to the stringent tax policies
towards foreign companies entering and operating in India the interests of local businesses are
protected.

The whole experience of dwelling deep into a research study was an eye opening experience all
together. As an MBA student and a working professional it has given me immense confidence when it
comes to tackling a problem within my organization. I feel that this whole experience has given me a
stronger insight into my strengths as a manager and more so it has equipped me with the sense to look
at problems in a 3 dimensional way without being worried about the finer details. I feel that to become
a future leader one must be capable of stepping outside of an issue and look back at it at a macro level
and understand the ripple effect that a decision made at a junior level creates for the entire organization
as a whole. During our Interviews we were fortunate to have spoken to industry trailblazers like Fadi

64
Malas the brain behind Just Falafel and Stephane Jacques the founder of Lemongrass but none
impressed us more than Fayez Al Nusari the founder of Mandilicious. His shear guts and instincts have
helped create an industry first within the GCC and the astonishing fact was that he did with a food
category that was in the region for centuries. The bottom line is that yes entrepreneurial spirit is not
something everybody can learn, you are either born with it or not but every now and then everyone
needs a bit of an helping hand and I feel this push should be initiated by the Dubai government and I'm
sure we will be seeing more brands like Just Falafel and Mandilicious enjoying success within the region.

To conclude I would like to say that as I reach the final hurdle in my journey with the MBA program in
Strathclyde I can confidently say that the years of learning has come to a full circle, during the course of
this research study we as a team felt confident whilst interacting with the founders of our 3 brands, we
were asking the right questions to get to the bottom of our hypothesis and some assumption while it
held true others were disproven, overall this was a tedious but fruitful experience and I eagerly look
forward to the numerous challenges in the course of my professional career thanks to this experience.

65
7. References

FranChoice. History of Franchising. Available: http://www.franchoice.com/franchise-information-

guide/what-is-franchise/history-of-franchising. Last accessed 23rd September 2014.

Hilary Strahota. (2007). Benjamin Franklin: Father of Franchising?.Available:

http://www.franchise.org/Franchise-News-Detail.aspx?id=35738. Last accessed 23rd September 2014.

IFA. (2000). An Introduction to Franchising. In: Barbara Beshel An Introduction to Franchising. USA: IFA.
2.

Welsh, D., Desplaces, D., & Davis, A. E. (2011). A Comparison of Retail Franchises, Independent
Businesses, and Purchased Existing Independent Business Startups: Lessons From the Kauffman Firm
Survey. Journal of Marketing Channels , 18, 3-18

Preble, J. F., & Hoffman, R. C. (2006). Strategies for Business Format Franchisors to Expand into Global
Markets. Journal of Marketing Channels , 13 (3).

Bellett, G. (2003). More Canadians finding future in franchising: Being your own boss is part of the
attraction. Vancouver Sun. July 14, E1.

Petersen, B., & Welch, L.S. (2000). International retailing operations: downstream entry and expansion
via franchising. International Business Review. 9 (4), 479-496.

Dianne H.B. Welsh, IlanAlon, Cecilia M. Falbe. (2006). An Examination of International Retail Franchising
in Emerging Markets. Journal of Small Business Management. 1 (1), 3-15.

Furey, T. (2007), Franchising in the Middle East, Dubai and Beyond. Franchising World. Jan2007, Vol. 39
Issue 1, p86-89, 3p

Welsh, D. H., & Raven, P. (2006). Family Business in the Middle East: An Exploratory Study of Retail
Management in Kuwait and Lebanon. Family Business Review , 19 (1), 29, 20 pgs.

66
Mary Ames. (2012). 5 Tips for Franchising in the UAE with N_K_D Pizza. Available:
http://shelter.ae/profiles/blogs/5-tips-for-franchising-in-the-uae-with-ian-ohan-n-k-d-pizza. Last
accessed 27th September, 2014.

Aliouche, E. H., &Schlentrich (2011), U. A., Towards a Strategic Model of Global Franchise Expansion,
Journal of Retailing. 87 (3, 2011), pp. 345–365

BassemNasri. (2013). Cited difficulties facing retail franchising in the middle east. In:
BassemNasri Emergence of Local Retail Food Franchises in the Middle East: The Influence of
Foreign Franchises.Grenoble Management School. 55-56, 64.

Welsh, D. H., Alon, I., & Falbe, C. M. (2006). An examination of international retail franchising in
emerging markets. Journal of Small Business Management , 44 (1), 130-149.

Furey, T. (2007), Franchising in the Middle East, Dubai and Beyond. Franchising World. Jan2007, Vol.
39 Issue 1, p86-89, 3p

Young, J. (2001). Retailers opt for a market full of eastern promise. Retail Week, 31 August , p. 14.

Marketing Department - Wharton University. (2009). Made for India: Succeeding in a Market Where One
Size Won’t Fit All. Available: http://knowledge.wharton.upenn.edu/article/made-for-india-succeeding-
in-a-market-where-one-size-wont-fit-all/. Last accessed 23rd Feb 2015.

Luthra, S. (2012). Determining India’s Economic Trajectory: The Role of Foreign Direct
Investment. Available: http://nbr.org/research/activity.aspx?id=204. Last accessed 23rd Feb 2015.

Prabhakar, B. (2011). How KFC & McDonald's plan to target each other in India. Available:
http://articles.economictimes.indiatimes.com/2011-08-28/news/29935857_1_kafeccino-kfc-s-krushers-
colonel-sanders. Last accessed 23rd Feb 2015.

Sharma, ABahree, M Beckett, P. (2012). Rising Risk: Foreign Firms Sense Hostility in India. Available:
http://www.wsj.com/articles/SB10001424052702304177104577311441951841400. Last accessed
23rd Feb 2015.

67
Siddhartha, V.G. (2011). Everybody Said It Wouldn't Work. Available:
http://forbesindia.com/article/leaderhip-awards/vg-siddhartha-everybody-said-it-wouldnt-
work/29552/2. Last accessed 23rd Feb 2015.

IHS Economics. (2015). Franchise Business Economic Outlook for 2015.Available:

http://emarket.franchise.org/FranchiseBizOutlook2015.pdf. Last accessed 4th Mar 2015.

68
8. Appendix
8.1 Participant Information Sheet

Name of Department - Management

Title of Project - The Food Franchise War - A study of the growing Franchise market within the food
Industry in Dubai which is being infiltrated by International brands thereby leaving very little market
share for the home-grown brands to grow.

Introduction

We, Mr Kavin Ujjainwala & Mr Vinay Kumar are MBA Students at the University of Strathclyde, P.O.Box
16062, Dubai, UAE. We are conducting a research and study on The Franchise Industry in Dubai within
the UAE and the title is as mentioned above. The project is conducted under the supervision and
requirement of the university and follows a strict ethical guideline to ensure ethical and fair
management of interviewees and other contributors. As a part of this we wish to Interview for the
purpose of collecting primary data for the research as we feel you will be a valuable asset to this project
and the insights you share could help us further shed light on this topic. Please do not feel obligated to
answer any of our questions should you feel the information passed on might be of a sensitive nature
which in turn might jeopardise you in any manner.

What is the purpose of this investigation?

The sole purpose of our investigation is to collect primary data in the form of one to one interviews and
questionnaires as our project has a strong focus on qualitative data rather than quantitative. Our reason
for this research stems from the fact that more often International food brands are taking the spotlight
within this vibrant market that is Dubai and we hope to uncover some of the key strategies that were
developed by Home-grown food brands who have grown successfully via the franchise model and has
managed to stand out from the ever crowding scene which is the food industry in Dubai

Do you have to take part?

Making the choice to be part of this project is strictly at the discretion of the individual to whom we have
presented this request. At no point will he or she be forced or coerced into being an involuntary

69
participant in our research. All the information that we gather during our research with the permission of
the individual will be shared in an unbiased and professional manner. We will also be more than happy
to ensure a soft copy of our final project is presented to the participant on request. Photographs of the
key individuals will only be taken on approval from the participant.

What will you do in the project?

Our main focus during our research and investigation phase is to gather as much as real life feedback
and scenarios. There will be a strong focus on qualitative information than quantitative information. One
of our key methods will be by means of direct one on one interview. You may be required to spend as
much as up to 1 hour during this process. All Interviews will be scheduled during weekdays between 9am
and 5pm. We are happy to accommodate any suitable timing to suit the interviewee. In some case where
the key individual is unable to meet us for a direct one on one interview we will be mailing the questions
via email and a call back will be scheduled to discuss any queries we may have to ensure that the
information shared with us is presented as true as possible. For certain key stakeholders questionnaires
will be used to get to the bottom of a relevant or preexisting trend for our project.

Why have you been invited to take part?

If you are an SME owner of a food brand or a master franchiser of a food brand then you are our key
individuals on whom we will be depending on to help us draw the franchise business landscape within
the region. If you are a key stakeholder such as an individual who manages a chain of franchise on behalf
of the owner or if you are part of a law firm which helps in drawing up contracts for franchise
agreements in the region then you are also an integral part of this research project. If you don't fit any of
the above categories then you have been contacted to assess a prevalent trend that may exist in the
market, you may be the end consumer!

What are the potential risks to you in taking part?

The aim of this project is to create a road map for new entrepreneurs who might be considering entering
this market and as a result our research is mainly targeted towards the qualitative aspect of things. Most
of the interviews will be captured as it is and will only be paraphrased to suit the flow of the project and
at no point will any information be twisted to arrive at a different outlook than that was portrayed by
the interviewee. If you are not the owner of a particular establishment and do not wish to have your

70
name published as to quoting a key point please inform us in advance so that suitable pseudonyms can
be given. All names and designations of all our interview candidates will be published as it is which might
be unsettling for some individuals and we urge you to consider this before committing to this research.

What happens to the information in the project?

All information received will be stored securely in either locked or secure cabinets, or password protected
electronic files. All references to individuals or organizations will be removed or given pseudonyms if data
is to be included within the submitted study, unless express permission has been given. All data will be
destroyed on submission and completion of the research project.

The University of Strathclyde is registered with the Information Commissioner’s Office who
implements the Data Protection Act 1998. All personal data on participants will be processed in
accordance with the provisions of the Data Protection Act 1998.

Thank you for reading this information – please ask any questions if you are unsure about what is
written here.

What happens next?

If you have read all of the above conditions in which this research will be carried out and is happy to
oblige then please fill out the consent form at the bottom of this document with you signature and mail it
back to us.

If you feel uncomfortable with being part of this research project and do not wish to participate then
please notify us via email and we thank you for the consideration and your valuable time.

71
Research Ethics

This investigation was granted ethical approval by the University of Strathclyde Department of
Management ethics committee.

If you have any questions/concerns, during or after the investigation, or wish to contact an independent
person to whom any questions may be directed or from whom further information may be sought
please contact:

Department of Management Ethics Committee

University of Strathclyde Business School,

Department of Management,

199 Cathedral Street,

Glasgow.

G4 0QU

72
Researcher Contact Details:

Name E-mail Contact Number

Vinay Kumar Premachandran.vinay@gmail.com +971507374461
ss
Kavin Ujjainwala Kavin.ujjainwala@gmail.com +971506638567

Supervisor Details:

Dr. Frank Martin

frank.martin@stir.ac.uk

Telephone: 01786 467346

73
 Consent Form

Name of Department - Management

Title of Study - The Food Franchise War - A study of the growing Franchise market within the food
Industry in Dubai which is being infiltrated by International brands thereby leaving very little market
share for the home-grown brands to grow.

 I confirm that I have read and understood the information sheet for the above project and the researcher has
answered any queries to my satisfaction.
 I understand that my participation is voluntary and that I am free to withdraw from the project at any time,
without having to give a reason and without any consequences.
 I understand that I can withdraw my data from the study at any time.
 I understand that any information recorded in the investigation will remain confidential and no information
that identifies me will be made publicly available.
 I consent to being a participant in the project
 I consent to being audio recorded as part of the project [delete which is not being used] Yes/ No

I Hereby agree to take part in the above project

(PRINT NAME)
Signature of Participant:

Date

I Hereby agree to take part in the above project

(PRINT NAME)
Signature of Participant:

Date

74
9. Bibliography

Aliouche, E. H., & Schlentrich (2011), U. A., Towards a Strategic Model of Global Franchise Expansion,
Journal of Retailing. 87 (3, 2011), pp. 345–365

BassemNasri. (2013). Cited difficulties facing retail franchising in the middle east. In:
BassemNasri Emergence of Local Retail Food Franchises in the Middle East: The Influence of
Foreign Franchises.Grenoble Management School. 55-56, 64.

Bellett, G. (2003). More Canadians finding future in franchising: Being your own boss is part of the
attraction. Vancouver Sun. July 14, E1.

Dianne H.B. Welsh, IlanAlon, Cecilia M. Falbe. (2006). An Examination of International Retail Franchising
in Emerging Markets. Journal of Small Business Management. 1 (1), 3-15.

FranChoice. History of Franchising. Available: http://www.franchoice.com/franchise-information-

guide/what-is-franchise/history-of-franchising. Last accessed 23rd September 2014.

Furey, T. (2007), Franchising in the Middle East, Dubai and Beyond. Franchising World. Jan2007, Vol. 39
Issue 1, p86-89, 3p

Hilary Strahota. (2007). Benjamin Franklin: Father of Franchising?.Available:

http://www.franchise.org/Franchise-News-Detail.aspx?id=35738. Last accessed 23rd September 2014.

IFA. (2000). An Introduction to Franchising. In: Barbara Beshel An Introduction to Franchising. USA: IFA.
2.

IHS Economics. (2015). Franchise Business Economic Outlook for 2015.Available:

http://emarket.franchise.org/FranchiseBizOutlook2015.pdf. Last accessed 4th Mar 2015.

Luthra, S. (2012). Determining India’s Economic Trajectory: The Role of Foreign Direct
Investment. Available: http://nbr.org/research/activity.aspx?id=204. Last accessed 23rd Feb 2015.

75
Marketing Department - Wharton University. (2009). Made for India: Succeeding in a Market Where
One Size Won’t Fit All. Available: http://knowledge.wharton.upenn.edu/article/made-for-india-
succeeding-in-a-market-where-one-size-wont-fit-all/. Last accessed 23rd Feb 2015.

Mary Ames. (2012). 5 Tips for Franchising in the UAE with N_K_D Pizza. Available:
http://shelter.ae/profiles/blogs/5-tips-for-franchising-in-the-uae-with-ian-ohan-n-k-d-pizza. Last
accessed 27th September, 2014.

Petersen, B., & Welch, L.S. (2000). International retailing operations: downstream entry and expansion
via franchising. International Business Review. 9 (4), 479-496.

Prabhakar, B. (2011). How KFC & McDonald's plan to target each other in India. Available:
http://articles.economictimes.indiatimes.com/2011-08-28/news/29935857_1_kafeccino-kfc-s-
krushers-colonel-sanders. Last accessed 23rd Feb 2015.

Preble, J. F., & Hoffman, R. C. (2006). Strategies for Business Format Franchisors to Expand into Global
Markets. Journal of Marketing Channels , 13 (3).

Sharma, ABahree, M Beckett, P. (2012). Rising Risk: Foreign Firms Sense Hostility in India. Available:
http://www.wsj.com/articles/SB10001424052702304177104577311441951841400. Last accessed
23rd Feb 2015.

Siddhartha, V.G. (2011). Everybody Said It Wouldn't Work. Available:

http://forbesindia.com/article/leaderhip-awards/vg-siddhartha-everybody-said-it-wouldnt-
work/29552/2. Last accessed 23rd Feb 2015.

Welsh, D. H., & Raven, P. (2006). Family Business in the Middle East: An Exploratory Study of Retail
Management in Kuwait and Lebanon. Family Business Review , 19 (1), 29, 20 pgs.

Welsh, D. H., Alon, I., & Falbe, C. M. (2006). An examination of international retail franchising in
emerging markets. Journal of Small Business Management, 44 (1), 130-149.

76
 Welsh, D., Desplaces, D., & Davis, A. E. (2011). A Comparison of Retail Franchises, Independent
Businesses, and Purchased Existing Independent Business Startups: Lessons from the Kauffman Firm
Survey. Journal of Marketing Channe , 18, 3-18

Young, J. (2001). Retailers opt for a market full of eastern promise. Retail Week, 31 August , p. 14.

77