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Three years ago Ace Hardware decided to revamp its international program. The first two years were spent building the model and rolling it out. The third year has been aimed at validating the model and helping make the newly designed program more franchiseable…plus signing as the first U.S. licensee in Afghanistan. The licensing agreement is for a minimum of 15 stores in 10 years in Afghanistan. The first store will open in a tier-two city, Mazar-e-Sharif, which is less politically charged than the capital. Ace is working with The Safi Group, an Afghani company based in Dubai, to develop the hardware stores, which help with one of the government’s main priorities to rebuild its country. Currently Ace has about 4,100 neighborhood hardware stores with 3,100 owners. The international model is different, however with an increase of master and area agreements. In the U.S., the company is a co-op model, which allows owners to purchase merchandise they sell at the lowest prices. In an international relationship, though, a more binding agreement is in order. “Franchising in these types of markets calls for different expectations on the part of franchisors,” said Robert Moschorak, president of Ace Hardware International. “You can’t do a five-year plan, you do a one-year plan,” he explains, because of the uncertainty. Ace is already in 60 countries. They are also in the early stages of franchising in South Africa, according to Ace. For more info, click here
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