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According to the Canadian Franchise Association, there are approximately 1,300 franchise brands across over 40 sectors of business operating in Canada. These franchise generate about $68 billion each year. Here are a few more quick facts on the market:
- There are over 78,000 franchise units across Canada
- About 1 of every 14 working Canadians are employed by the franchise industry directly or indirectly
- 62% of prospective Canadian franchisees have a college degree
Per a survey, the top industries in which prospective Canadian franchisees are looking for an opportunity include:
A special feature of the Canadian franchise industry is how it intertwines with the U.S. franchise industry. The U.S. is the largest franchise industry in the world and when U.S. franchises want to go international, often the first look is towards its neighbor to the north. In fact, for several of the franchises in the Top 100 that only operate in two countries, those two countries are virtually always the U.S. and Canada.
For good reason too. Canada is not only close as it can be to the U.S. in proximity, the countries also share many cultural elements and a language (except for the province of Quebec where French is the official language, but English is still widely used there as well). Not to mention, the U.S. dollar stretches well in Canada.
Larry Weinberg, who specializes in franchise law and chairs the Legal & Legislative Affairs Committee at the Canadian Franchise Association, believes Canada is the No. 1 destination for U.S. brands. “We are not really full-blown international to them,” he says. “We’re a simpler place to go.”
However, that simplicity doesn’t extend to Canada’s franchise regulatory environment. “It’s unusual. As far as I know, Canada is the only country in the world where part of the country has a franchise law and part of it doesn’t,” Weinberg says.
Six of 10 Canadian provinces have franchise-specific legislation with the British Columbia Franchise Regulation Act being the most recent addition. The Canadian Franchise Association does its best to foster transparency between franchisors and prospective franchisees by requiring members to produce a disclosure document, but that doesn’t cover all the franchises in Canada.
Fortunately, the lack of uniformity in franchise laws across the country hasn’t been a deterrent to franchise expansion in Canada.
“I have clients from all over the world who see Canada as a wonderful, politically, financially, culturally stable jurisdiction to develop their markets,” says Stéphane Teasdale, chairman of the international law firm’s global franchise and distribution law group at Dentons Canada LLP (she also serves as co-head of the corporate and commercial law group). “[Clients] see Canada as being a relatively easy and not so expensive place to do business, with 30-million-plus people to buy their goods and services.”
It also helps that “every Canadian bank has now established a national franchise department specifically to deal with the growing demand for startup franchised businesses,” according to Peter H. Thomas, Chairman and CEO of Thomas Franchise Solutions.
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