Swift disclosure: franchising in Rzeczpospolita Polska

Profound economic and social changes are creating a revitalized business environment in Poland.

Until recently, few franchisors showed interest in Poland, and for many reasons, first among them: a shortage of prospects who could afford franchise fees and initial start - up financing. Today, international franchisors still aren't rushing to Poland, but both foreign and local franchise companies have invested in this Central European market of nearly 39 milion people.

Poland represents one of the most dynamic emerging markets in Europe, where foreign investment has reached $50 bilion. During the last 7 years, on the road to privatisation, growth of GDP has remained consistently above 4 percent, and inflation has been decline.

The liberalization of the Polish economy has allowed the starting-up and running of companies almost in complete freedom, and the result has been rapid development, both private and industrial.

Thanks to the reforms, Poland has started its own development in franchising. The first international franchising systems invested in the market in the early 1990s. Adidas entered the market first and now has 300 franchisees in the country. Following soon after were McDonald's and the French systems of Yves Rocher and: Jean Luis David. Shortly after came Kodak and others. The mid 1990s saw the starting up of the first Polish franchise systems.

There are more than a hundred franchise systems operating in Poland, about 70 percent of which are foreign and the remaining Polish. About half of the franchise systems operate in retail trades, while half are engaged in service businesses, such as catering.

Common problems for franchisors?

Education and formal training in franchising plays a very important role in relations between franchisors and franchisees. Legal and tax regulations change rapidly and hinder development.

Potential for expansion?

Poland has an optimum position for companies seeking to invest and expand, not only in the Polish market, but also in Scandinavia, Russia, Ukraine, etc.There is enormous opportunity for franchise development.

Read more: Andrzej Krawczyk, Renata Zbiec, International Franchising, Summer 2002, p.42