When you think of franchising in the Middle East, the last place you would probably consider is Iraq. Instead, you are likely to fix your eyes on United Arab Emirates. And while UAE may ultimately open the doors to neighboring states, you will face fierce competition in the already saturated food and beverage sector. The time is ripe to reevaluate your expansion strategy to the hidden and unexplored markets in Iraq.
Your instincts may be telling you that the legal, financial, and security environment is light years away from any Hardee's in sight.
Think again. The burger has landed, and so have fried chicken and pizza. To date, KFC, Hardee's, ACE Hardware, Nestle Tollhouse Cafe, Texas Chicken, Cinnabon, Pizza Hut, Tutti Fruiti, Paul Smith, City Center and Mango have all hit the ground and are expanding operations through Iraq.
Is Iraq safe? There is no doubt the war on ISIS is still on. However, the distinguishing feature of Iraqis is to roll with the punches, sometimes literally. With a population that has endured 40-plus years of conflict and turmoil, Iraqis have learned to enjoy the present and appreciate life's experiences.
Each Thursday through Saturday, the official weekend in Iraq, a significant portion of the 70 percent of the population that is under the age of 35, spend their time at secure indoor shopping malls and restaurants. The weekend is when Iraqi families take a break from the daily grind and spend time making memories with their loved ones, usually over a unique, exotic and special meal. For Iraqis, U.S. franchises represent places where you can experience the world without leaving your home.
Even during these trying times in Iraq, well-known franchises are steadily there, for the following reasons:
CONSUMER DEMAND YIELDS STEADY PROFITS
With a population of more than 37 million, of whom 7 million are in Baghdad, 3 million in Basrah, and over 1 million in Erbil, the market is significantly larger than its neighboring countries.
In the past four years alone, six secured shopping malls opened throughout Baghdad. At peak times, during the weekend, the Mansour Mall in Baghdad gets an estimated 60.000-plus visitors per day. On a regular day, more than 30,000 visitors shop on three levels of the estimated 12.000-square-meter mall. At least three more malls are opening soon in the heart of Baghdad. This includes the Iraqco Company's Babylon Mall, which is looking for prime brands and is offering a wide variety of options for...