CASE STUDY: Candy Bouquet International

THE COMPANY

Chocolate vases, squares of vanilla fudge, and sugar-free lemon drops—what better way to grow a business than appealing to the world’s sweet tooth? Margaret McEntire, founder, president, and chief executive officer of Candy Bouquet International, thought so. Her firm is now the largest candy franchise in the world. But it wasn’t always that way. Candy Bouquet started as a one-room operation in 1989, but by 1995, McEntire was looking to expand her business overseas.

THE CHALLENGE

McEntire says her biggest challenges have been learning more about business practices in different cultures, gaining key market information, and learning about channels of trade. Educating foreign businesspeople about American franchises is another challenge, and so is describing what a candy bouquet is. The company has had to explain the concept of rolling a candy store and a florist together and making a product that is really all candy.

THE SOLUTION

In 1995, McEntire attended a trade show in Washington, D.C., where she met a trade specialist from the U.S. Commercial Service. That connection led to her participation in a Commercial Service mission to Eastern Europe and introduced her to doing business in foreign markets.

In the years that followed, Candy Bouquet expanded to dozens of foreign countries. The company’s unique franchising system allows individuals to make a single purchase into the franchise and pay no continual overhead. The only requirement is that their supplies must come from the Candy Bouquet warehouse in Little Rock, Arkansas.

“One of the most helpful things I’ve found in doing foreign business is having a person we know in that country to help us out,” says McEntire, referring to the Commercial Service’s worldwide network of trade specialists. She credits much of her success to Dennis Millard, a trade specialist at the Little Rock Export Assistance Center. “When I know a foreign franchisee is coming, I call Dennis at our local U.S. Commercial Service office, and he provides me with solid information on the business practices of that culture.”

Millard has also helped her take advantage of many Commercial Service programs. Candy Bouquet participates annually in the International Franchise Trade Show and has taken part in trade missions around the world. In 1999, McEntire participated in the Women in Business Matchmaker Trade Mission to South America and the Women’s Economic Summit of the Americas in Buenos Aires, Argentina. McEntire is also a frequent participant in Commercial Service global video teleconferencing. She is a regular presenter at the international trade events sponsored by the Little Rock Export Assistance Center and shares her experiences with other businesses that are new to exporting. McEntire also advertises in Commercial News USA, a product catalog produced by the Commercial Service and distributed to more than 400,000 overseas buyers.

With assistance from the Commercial Service, Candy Bouquet has expanded from a single-room operation to more than 700 franchises in more than 40 countries. McEntire says, “Nobody likes to pay taxes but [the Commercial Service] is the best use of my tax dollars.”

LESSONS LEARNED

McEntire has several lessons to pass along to new exporters:

  • Adapt your product for other cultures. In one instance, McEntire was trying to sell chocolate vases in Malaysia, but there were few takers: “We discovered that Malaysians … thought the chocolate pieces were too big. So we got the idea of ordering sample sizes from the manufacturer, and it did the trick.”
  • Educate yourself about local practices. On one occasion, McEntire shipped candy to Saudi Arabia in boxes that bore pictures of women’s hands holding drinking glasses. Saudi Arabians don’t drink, so their customs bureau returned the boxes. On another occasion, McEntire invited three potential Candy Bouquet franchise owners from Indonesia, Malaysia, and the United Arab Emirates (UAE) to visit her home for training. The gentleman from the UAE eventually wanted to pray. “Margaret,” he asked, “which way is Mecca?” McEntire has learned to be prepared for any cultural contingency.
  • Realize that there will be setbacks. One such setback occurred in Cairo, where women seldom start their own businesses. Much of the candy that her franchisees had ordered was burned on the airport tarmac. Eventually, many of the women were able to persuade their husbands to join in as business partners, making the venture more socially acceptable.
  • Protect your intellectual property. In China, someone copied McEntire’s brand name and then tried to order additional candy from her. Fortunately, other Candy Bouquet franchisees in China informed McEntire about what was going on. She is now pursuing legal action.
  • Enjoy your work. “I love my job; it’s fun to go around the world to help people eat candy and chocolate,” McEntire says. “We are changing the face of the world with a brand-new industry, and it is very gratifying to see our franchises succeed and help the local economy. If you do what you love, you will never work a day in your life.”

ACTION

Find out if franchising is your window to exporting:

  • Consider the advantages of franchising. According to Sam Dhir of the U.S. Commercial Service, franchising offers several advantages for businesspeople interested in exporting. First, the franchisee is managing an established concept. It has already been market tested, so the franchise is a low-risk investment. Second, the franchisee is his or her own boss. And third, the franchisee receives the full support from the master franchiser in terms of training, advertising, and market support. For more information about franchising, visit the International Franchise Association Web site at http://www.franchise.org.
  • Be aware of the social customs of target markets. Dhir recommends that potential franchisees look closely at the social customs in the country where they would like to do business. Contacting the Commercial Service office in that country is an excellent way to learn about cultural issues and ways of doing business. Visit http://www.export.gov for the nearest U.S. Export Assistance Center, and that office will contact the appropriate Commercial Service post in the country of interest.