Franchising and the Canadian Economy

According to the Canadian Franchise Association (CFA) in April 2011, there are 78,000 franchises in Canada, and the number is still growing across all market sectors. The Canadian economy has remained strong throughout their neighbors’ challenging recession and many national economic experts believe that 2011 is poised to be a strong year, particularly for business investment.

One of the more popular business venture concepts within Canada is the franchise opportunity. According to the CFA, there are nearly 1,100 registered franchise opportunities within Canada, giving the business investor a wealth of choice when determining which opportunity is the right opportunity of today.

Canadian or U.S. Franchise?

Prior to opening a franchise, it is critical to understand the business opportunities at hand. In addition to joining one of the current 1,100 available registered franchises, business owners may also have the option to bring over a franchise from the U.S. If this option is of consideration, there are several factors to consider prior to initiating the process, including:

  • U.S. franchises are required to comply with Canadian law once they cross the border
  • Trademarks filed within the U.S. are not recognized in Canada unless filed and approved under Canadian law
  • Cross border taxes could be a challenge for the franchisor
  • Canadian laws may impose unique restrictions on the U.S. based franchise
  • U.S. and Canadian accounting principles may differ, requiring developing a cohesive operating system for both countries

To create an efficient transition into Canada, it is imperative to partner with a strong legal team. Alternatively, with so many options already available within Canada, you could find your perfect fit without reinventing the wheel. After all, most entrepreneurs are interested in the bottom line, and making the bottom line grow as quickly as possible.

Franchising- Hot Sector Trends

Once you have made the decision to franchise, how do you determine which opportunity is best suited for your needs as well as the current marketplace? The CFA published top franchising trends in the January/February 2011 issue of Franchise Canada magazine, highlighting the following:

  • Commercial and Residential Services- Increased 47% in 2010
  • Advertising/Marketing/Promotional Products- Increased 45% in 2010
  • Children’s Products & Services- Increased 37% in 2010
  • Business Consultancy/Services & Training- Increased 29% in 2010
  • Seniors/Home Health Care- Increased 29% in 2010

This sampling of franchise trends could assist you in narrowing down the list of franchising opportunities. In addition to current consumer trends, be sure to consider your specific locale, your investment budget, operating costs, name recognition of the franchise and overall return on investment opportunity. With proper consideration and research, you can select the best franchise for your given situation and objectives.

This article was written by Julie Verville, an expert in Franchises at