Strategies to Boost Black Franchise Ownership

Black Franchise Leaders Discuss Transforming Franchising Through Diversity and Inclusion

Black History Month commemorates the contributions that African Americans have made to culture, business and more. There were 161,031 U.S. firms with majority Black or African American ownership in 2021, according to Pew Research. Data from the Annual Business Survey shows that Black-owned firms’ gross revenue rose from an estimated $127.9 billion in 2017 to $183.3 billion in 2021, a 43% increase.

Despite this growth, majority Black-owned businesses were only about “3% of all U.S. firms that were classifiable by the race and ethnicity of their owners in 2021,” according to the Pew Research report. To increase Black ownership in franchising specifically, the International Franchise Association’s (IFA) Black Leadership Council’s mission is to increase education about the business model as well as facilitate communication and collaboration to improve diversity. As a big proponent of diversity, equity, and inclusion, the IFA also announced its new Franchise Ascension Initiative, aiming to prepare individuals from underrepresented groups and economically disadvantaged backgrounds for franchise ownership.

In a recent webinar, Black franchise leaders focused on the importance of diversity and inclusion efforts in franchising. They delved into their personal experiences in franchising, shared perspectives on the barriers to diversity and explored strategies to overcome these challenges. This collective effort underscores the commitment of the IFA and Black leaders in franchising to drive positive change and inclusivity. Below, meet these leaders to see how they are creating a path for future franchise success in Black communities.

Chris Brown 

Be willing to go into different places, different spaces, different types of networking events.

Background in Franchising: Chris Brown works on franchise development for KFC U.S. and also has experience in the automotive industry with Driven Brands. 
Barriers to Diversity: He believes there should be a greater emphasis on educating diverse populations about the benefits of franchising. (Brown didn’t learn about franchising early in his career and hadn’t fully appreciated how prevalent the model is.) He also wants prospective entrepreneurs to understand that they don’t need to be a celebrity with hundreds of locations in order to be successful. Brown acknowledges that access to capital remains an issue for potential franchisees. 
Industries that Foster Diversity: As an employee of the Yum! Brands family, Brown knows the food and beverage industry has made a very strong effort to welcome minorities and other underrepresented groups to its ranks. But there is always room for improvement to increase minority franchise ownership and promote leaders in franchise systems, he says. 
Strategies to Implement: To overcome barriers to diversity, Brown says webinars like this are important outreach and education. He praised fellow panelist Brian Woods and others for posting on social media and going into the community to share their experiences in franchising. Brown also urges business owners to attend networking events that aren’t as well-publicized. He further recommends that companies bring on creative people who will venture beyond their brand’s usual borders. “Be willing to go into different places, different spaces, different types of networking events.” 

Karriem Kanston

Just because the brand might look so big to you, you can still own a piece of the pie and make an impact. 

Background in Franchising: Kanston, who has experience in business lending, training and economic development, owns two Little Caesars locations in Raleigh, N.C. In 2020, he and his wife moved to the area and looked for independent business opportunities. They joined the pizza franchise through a resale. 
Barriers to Diversity: He believes diversity can and will thrive in franchising. To serve as a subtle example for others, Kanston put his picture on the wall to establish that he owned the business, proof that business success is attainable. Kanston predicts that through education and awareness efforts that foster a mindset shift, ownership among underrepresented populations will increase.
Industries that Foster Diversity: While the fast-food industry has made some strides, Kanston has seen firsthand that there is more to be done in terms of educating and promoting diverse candidates in the industry. He tells entrepreneurs that “just because the brand might look so big to you, you can still own a piece of the pie and make an impact.”  
Paths to Success: As someone who is experienced with resales, he appreciates that they offer a way to ease into franchising without having to build or lease a new location. Kanston was able to get up and running in less than six months, and he had customers right away. Resales usually are more affordable and have the benefit of a built-in customer base. 

Celeste Purdie

It’s not a “nice to have” to talk about diversity; it makes smart business sense.

Background in Franchising: The passionate entrepreneur has over 25 years of experience in corporate human relations. She worked at Verizon for 12 years before jumping into business ownership with the Foot Solutions franchise in Greenville, S.C. While the Greenville location will be the first to open, she has the rights to two more. In addition to being a full-time real estate agent, Purdie and her husband own a self-storage facility. 
Barriers to Diversity: In her view, the “elephant in the room” about franchising is that while many have heard about it, there are negative connotations associated with the business model. “Until you get in and know and learn, it’s like, ‘I wish someone told me about this 30 years ago.’” 
Industries that Foster Diversity: She cites the beauty industry as an example of a franchising sector that has fostered diversity. In her view, these businesses (lash studios, nail and hair salons, IV therapy) have done well in recruiting underrepresented individuals.   
How Diversity Impacts Franchising: Simply put, “It’s not a ‘nice to have’ to talk about diversity; it makes smart business sense.” As a disabled veteran, minority and woman who owns a business, Purdie has witnessed the public’s eagerness to become customers of entrepreneurs like her. 
Strategies to Implement: Since many big cities have massive diversity conferences, she encourages franchise brands to participate. The benefit: Their presence shows candidates that there are multiple ways to enter franchising. 
Experience with an Accelerator Program: She learned about an accelerator program through the Greenville Chamber of Commerce, which helped her start her Foot Solutions business. Entrepreneurs typically need to operate for three years to even be considered for the program, but Purdie’s unique background and hard work in her business led to her early acceptance. She said there were 10 cohorts in the program with her, three of whom were franchise owners. “It was a really safe ecosystem to sit down with other business owners and dive into your finances, HR, marketing, a strategic growth plan and how to scale up.” They all had access to business coaches who had previous experience in the program. Because of her positive experience, Purdie encourages others to participate in accelerator programs when possible.      

Brian Woods

A lot of brands that are successful normally listen to their franchisees.

Background in Franchising: Brian Woods is the group vice president of franchise development for Neighborly, a franchisor of home services brands that has expanded to more than 19 concepts with over 5,500 franchise owners in nine countries. Prior to joining Neighborly, Woods was at Motel 6 overseeing the hotel brand’s franchise development in the western U.S. 
Barriers to Diversity: In his experience, a lack of knowledge about the business model is a major barrier to diversity in franchising. (Woods didn’t learn about franchising until he worked for Motel 6 at the age of 30.) While Woods says more has to be done, he credits educational webinars and similar outreach for enhancing diversity in franchising over time. The Small Business Administration has also helped the effort by providing capital to underrepresented segments of the U.S. population, he says.  
Industries that Foster Diversity: In terms of marketing and publicity, Woods praises the fast-food industry for doing its part to foster diversity and inclusion. He believes the home services industry can learn how to recruit and promote diversity from the successful tactics used by quick-service restaurant brands.
How Diversity Impacts Franchising: Woods notes that the positive impacts of diversity have been studied and can be felt across entire franchise systems and industries. “Having that ability to bring those different perspectives into your network can help with ideation and understanding to successfully improve your brand. A lot of brands that are successful normally listen to their franchisees.” This can be done with Franchise Advisory Councils, which he says should reflect a variety of backgrounds in order to maximize franchisee satisfaction. 
Affordable Industry: Woods describes home services as having “a much easier hurdle of investment from other concepts.” Among Neighborly brands, for example, he points out that many are home-based, with an average initial investment of $150,000 to $250,000.