From the November 2001 issue of Entrepreneur

Is a woman's place in franchising? It didn't seem that way in years past. The disproportionate lack of women in franchising was apparent everywhere from franchisors' executive offices to franchisee-owned locations.

Even Dina Dwyer-Owens, CEO and president of The Dwyer Group, wasn't immune to the problem. When she was appointed acting CEO, some franchisees campaigned against her, because they didn't think a woman should be in charge of a corporation focused on such traditional male occupations as plumbing and electrical work.

It's still an issue among The Dwyer Group's 1,400 franchisees. Dwyer-Owens estimates only 10 percent of franchise agreements include a woman's signature, although many franchises are run by husband-wife teams where the woman controls business operations and the man handles fieldwork.

Why the discrepancy? "Competence," says Dwyer-Owens. "A lot of women don't believe they have it, or they're afraid to prove they have it. They're afraid to get out of their comfort zone."

According to the most recent data-a 1999 study by private consulting firm Women in Franchising (WIF)-the number of women-owned franchises is not increasing proportionately to the increase of women-owned companies in general.

In addition, WIF found that the female franchise ownership percentage rate decreases as franchise cost increases. "There's not so much of a glass ceiling keeping women from purchasing a franchise as there is a green ceiling-money," says Samuel Crawford, a WIF senior franchise consultant and author of the study.

Crawford believes that financial ceiling may be related to the way women typically start businesses. "A lot of women start with little or no money and use their earnings to grow the business," he says. "But that's typically not a growth strategy that works."

While Crawford attributes this common mistake to lack of business savvy, it may also reflect many women's conservative fiscal nature and limited financing options. According to reports by the National Foundation for Women Business Owners (NFWBO), while women own 38 percent of all U.S. companies, they receive less than 2 percent of venture capital. And although access to capital is increasing, NFWBO found the amount of credit granted to women still trails that of men.

Wanted: Pioneers

In the past, lack of confidence was one reason women shied away from leadership roles in franchising, says JoAnne Shaw, co-founder of The Coffee Beanery and the first woman chair of the International Franchise Association (IFA). "But that's changing," she says. "From what I see, women are beginning to take the lead. I don't have statistics [to prove] this; it's just kind of a gut feeling that has more to do with attendance at IFA conventions. I meet with other franchisors at local and regional meetings, and I'm beginning to see more women becoming involved and taking stronger roles."

That was definitely not the case when Shaw first joined the IFA board in 1989. At that time, "there was one other woman, and she didn't attend the second meeting," says Shaw.

As more women gain leadership positions, insiders believe the number of women franchisees will likely increase. That theory is the basis for women-oriented programs like the Women Franchise Committee, created by the IFA in 1999. In fact, one of that committee's current goals, says chair Lorrie Rennick, is to train women as leaders in the industry and have them serve as mentors.

"We want to expose women to the franchise industry and to other women. We want to get them out as speakers and presenters. We want them to sit on [industry] round tables and committees," explains Rennick, who co-owns American Leak Detection with her husband, Richard.

In addition, Rennick says the committee is developing a Web site featuring successful women franchisees talking about what it takes to make it in franchising. The group also educates franchisors about how even something as subtle as whom mail is addressed to-only the man, even though the woman may be the one in charge of the office-can send out discouraging signals.

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At McDonald's, efforts have gone further, thanks to its Women's Operators Network (WON), formed in 1989. Its initial goal was to better utilize the leadership talents of women owners, says WON president Charlotte Dutton.

One of the first projects WON developed was a formal spousal certification program. "That program brought many women into the system," says Dutton. "[Developing the program] was important for a lot of reasons. For one, if your husband was on the licensee agreement, [but] you weren't an approved operator, you didn't necessarily have the right to the store if something happened to him."

Dutton says WON has also been instrumental in propelling women into leadership roles in the system, because the company calls them to request names of women to appoint to committees. In addition, the group mentors new female operators and has a regional training program helping women gain the skills to sit on the McDonald's national purchasing board.

"There are no women on that board, which works with the suppliers and vendors. We've started at the regional level, where we have a seat for a woman to do a sort of internship program," says Dutton, who believes more women on the WON board will in turn lead to more women vendors.

Lower the Financial Hurdle
On the corporate level, Church's Chicken, headed by Hala Moddelmog, is educating women about the benefits of franchising by participating in women-focused trade shows and events, according to Hannibal Myers, Church's worldwide development officer.

And while many franchisors have chosen to reduce the franchise fee to help women overcome the financial hurdle, Myers says Church's is going in another direction: "If money is an issue, we try to identify those women with the desire, experience and operations background and match them with an investor who has money."

By all accounts, women's involvement in franchising is growing-maybe not in actual numbers, but in influence. And insiders believe it's just a matter of time before the number of women franchise owners finally starts to climb.

Contact Sources

  • Women in Franchising
    (312) 431-1467