FRANCHISING IN IRELAND - SHOULD FIVE GUYS GO IRISH?
Making a decision on products and countries seemed daunting at first. Brainstorming with associates and friends to find that perfect idea that held my interest seemed impossible. Several ideas were discussed and brainstormed, however, when thinking about restaurants and franchises the first idea was born. Five Guys Hamburgers and Fries seems the perfect fit for Ireland and there began my journey.
From about 1995 to 2007, Ireland developed a very rapid economic growth called the Celtic Tiger, going from one of the poorest countries to one of the wealthiest. The Irish had a low corporate tax rate, borrowed money from the European Union and invested these funds in education. These and other factors attracted major companies such as Dell and Microsoft, and these companies were encouraged to locate to Ireland. These companies found that lower employee wages, low taxes, and membership in the European Union were all factors to be considered in deciding to move to Ireland. Ireland also has a state run agency that encourages start up businesses by providing financial, technical and social support. In 2008-09 Ireland entered a recession - the first in over 10 years.
As Ireland faced this major economic crisis, as did several other countries , the Irish unemployment rate increased to 8% in 2008, and the housing market went from 14-16% in 2006 to approximately 5% in 2009. By April 2010, unemployment was 13.4%. The Irish government has taken across the board cuts in spending and in 2009 budgets including wage reduction for all public servants. Also, in 2009 the Irish government established NAMA - The National Association Management Agency. This agency acquires property and development loans with a book value of $100B from Irish banks. Irish banks are in trouble: for instance, the Anglo Irish Bank lost $18 billion Euros last year. Irishmen blame the Anglo Irish Bank for the banking crises and the Irish government is paying $40 billion dollars using Irish taxpayer funds to bailout the bank. Many articles quoting Irish and European economists predict that Ireland will come out of the recession midyear of 2010. The Gross Domestic Product (GDP) in 2009 was $42,000 per capita. From 1995 to 2007 the GDP growth averaged 6%, 2009 the GDP had declined to -7.5% approximately. In 2000, in terms of GPD capita, Ireland was the sixth richest country in the world.
Ireland is about the size of West Virginia and the 12th largest island in the world and has a government that is a republic, parliamentary democracy with an Executive, Legislative and Judicial Branch. Their legal system is based on English Common Law. The capitol of Ireland is Dublin, where 40% of the population lives within 100 kilometers and 66% of the population is between 15-64 years of age. Ireland has turned from a once important agricultural society to a services and industry society. Only about 6% of the labor force is now...