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Franchising/Telecom businesses


Mr. Kern

I am in Montreal (Canada) and there is a very big immigration movement from around the world (europe, caraibbean, asia etc...).

I am very interested in offering these communities services helping them being in contact and close with their families in their country of origin using telecommunication.

I would like to have some business models ideas related of this kind of services (anything related to communications).

Thank you very much


I am sorry that I have taken so long to answer your very interesting question.

I actaully know a fair amount about international telecom because a franchise industry client has another business (not relating to franchising at all) that is in the business of international telecom.

The key to making money on international calling is to find a way to keep callers loyal to your system.  You need to find ways to make sure that your customer's calls always go through your switch (or the switch that makes you the most money).  Once you have that figured out, the big remaining task is sales.  How do you get the immigrant community in Canada to buy your product and service.

I believe that your focus on franchise distribution in a traditionally unfranchised business is insightful.  A growing trend in the franchise world is to franchise just the sales function of a complex business.  The old model was to train franchisees, say in a restaurant company, to do all of the things that are necessary to run the business.  The franchisee builds the store, orders the food, hires and trains the staff, advertises the products, prepares and serves the food, deals with trash disposal and property maintenance, records the sales and keeps the books and finally reports results to the franchisor.

The new model that I see creeping into the idustry is very different.  Some companies -- especially companies with highly capital intensive fulfillment systems -- are selling franchises simply as a way of recruiting an independent, hard working sales force.  A company selling point of sale computer systems for personal care salons has developed the software and hardware.  The franchisor supports the end user customer and sells products that can be ordered through the point of sale equipment.  Shipping is direct from th efranchisor.  All the franchisees do is sell the systems and collect residual income off the ongoing revenue streams.  The franchisor loves this because the franchisees work hard -- they own their businesses and have "skin in the game."  The franchisees love it because they don't have to fix broken equipment and waste time on customer support that could be used to sell the next system.

It strikes me that, whether your service is provided through a card, a code or a dedicated phone (in any case a mechanism that directs the calls to the most profitable carrier or switch), what you need is a large sales force of hard working people who only make money if you make money.  Hiring such sales people is a nightmare, and the law doesn't make it easy to make all of their compensation truly contingent upon your success.  Selling these people franchises, though, overcomes that problem.

On January 11 we are kicking off  a series of six live webinars on the topic of How To Franchise Your Business.  I you would like your can provide me an email address and I will send more information.  Even if you are just thinking about franchising among other possibilities, the first three sessions in the series would be useful for you.  They will provide a good look at what franchising is, why it benefits so many businesses and -- in broad strokes -- what you have to do to get a franchise up and running.  The final three sessions dig deeper into exactly how one gets a franchise offering project planned, budgeted, scheduled and, of course, done.

It is hard to provide real useful information in this All Experts setting.  I hope you will contact me if I can help further.

Scott C. Kern
Kern & Hillman, LLC
2911 Dixwell Avenue, Suite 203
Hamden, Connecticut 06518
203-782-9081 facsimile


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Scott Kern


I can answer questions about legal and regulatory issues relating to franchising. Also I can answer questions about all aspects of operating a franchise company, having run a 450 unit franchise company for some years. Finally I can answer questions about choosing and carefully investigating a franchise investment opportunity.


For some years I ran the Carvel ice cream shop franchise company which had approximatedly 450 outlets. I am the only private practice franchise attorney in the country who has first hand experience operating a franchise company. I have handled extensive litigation involving franchise disputes. I represent new franchise company startups on a regular basis and I represent franchise buyers. Our firm does a great deal of strategic and tactical business consulting for franchise industry clients.

Former Chair of the Connecticut Bar Association Franchise Committee American Bar Association Form on Franchising Board of Directors of Lincoln College of New England

J.D. University of Virginia School of Law, 1984 B.A. History, Yale University, 1981 M.B.A. University of New Haven, 1992 M.A. History, University of Virginia Graduate School of Arts and Sciences, 1984

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