The DIA franchise sustained exponential growth in 2015. Over the course of the year, DIA added 612 stores run by local entrepreneurs to its network, bringing the total to 3,697, equivalent to 47.9% of the group total (and 61.1% of the DIA store network). It was a record year for the company in terms of franchise openings, evidencing its strategic commitment to this business model as the optimal proximity retailing formula.
By region, the franchise penetration rate stood at 39.8% in Iberia (Spain and Portugal) and 68.8% in the emerging markets (Argentina, Brazil and China), up very substantially from 2014 (penetration of 35.7% and 60.9%, respectively).
Spain, the group’s main market, had 1,954 franchised stores at year-end, accounting for over half of the DIA network.
NO. OF FRANCHISES
The Clarel chain made its début in the franchise segment in 2015: at year-end, there were 31 franchised Clarel stores.
The DIA Market and DIA Maxi stores managed by local entrepreneurs totalled 2,183.
DIA’s franchises drive job creation, employing over 24,000 people at year-end 2015
In all of its markets, the DIA franchises drove local job creation, employing over 24,000 people at year-end.
The brand’s best ambassadors
Expansion of the franchise falls under the scope of DIA’s organic growth strategy. The company views this model as the most efficient formula for excelling in the proximity segment and sees its franchisees as the brand’s finest ambassadors.
In recent years, the DIA franchise has become an international benchmark thanks to the efforts of the entrepreneurs associated with DIA. With their hard work and dedication, they bring very valuable knowledge of their markets and customer know-how, making significant contributions to the company’s growth and the local economy.
Communication with potential franchisees
In its bid to continue to recruit new franchisees, the company continued to develop a number of communication channels, notable among which the various websites used for external communication purposes, attendance at trade fairs and other special programmes under which company staff and existing franchisees recommend this business model.
In 2015, the company launched websites in Portugal (franquia.minipreco.pt) and Argentina (franquiciadia.com.ar) to provide entrepreneurs with a potential interest in acquiring a DIA franchise with relevant information. These websites provide corporate information about DIA, its franchise formula and its various sales and management models, all of which illustrated by testimony from franchisees, the model”s finest ambassadors. Potential franchisees can also read about important developments online and contact the company for additional information.
DIA participated in more than 10 franchise trade fairs in Spain in 2015, briefing over 300 interested parties
Trade fair attendance is another way of attracting new entrepreneurs. In 2015, DIA participated in more than 10 such trade fairs in Spain, interviewing over 300 interested parties, including the Franquishop fairs in Seville, Zaragoza, Barcelona and Madrid, Franquiatlántico in Vigo, Expofranquicia in Madrid; the Andalusia Franchise Trade Fair in Granada; Frankinorte in Bilbao, and the International Franchise Expo in Valencia.
Abroad, the firm participated in the International Franchise Expo organised by the Argentine Brand and Franchise Association in Argentina, at which 180 interested parties visited the company’s stand; in Portugal, Minipreço attended the International Franchising Fair in Lisbon for the first time; and in Brazil, DIA attended the all-important trade fair sponsored by the Brazilian Franchising Association, among others.
DIA attends these trade fairs with its growth teams who tap their experience and knowledge of the franchise model to showcase its benefits to attendees.
There are other initiatives, such as the Referral Programme in Argentina, which seeks to encourage employees and existing franchisees to participate in the search for entrepreneurs who might be keen to set up a DIA franchise.
Referring employees propose candidates for operating a store; in the event a franchise agreement is signed they receive a specific number of points for exchange for gifts from a catalogue (they can accumulate points to qualify for better trips and gifts).
The referral programme has proven a success in Argentina, having resulted in the addition of more than 60 new franchisees.
Thanks to a strong performance in Argentina, the DIA franchise regime in Argentine received the Quality Seal granted by the Argentine Brand and Franchise Association (AAMF for its acronym in Spanish) in conjunction with Bureau Veritas-BVQI, the world-leading quality certification provider.
Worthy of special mention is the Franchise Excellence Seal awarded by the Brazilian Franchise Association (ABF for its acronym in Portuguese), helping to consolidate its image as franchisor in this market. This accolade was awarded after interviewing 70 franchisees who were asked to answer 35 questions designed to measure their satisfaction as franchisees and their companies” performance.
Penetration of new markets via strategic agreements with third parties
The franchise is one of the group’s greatest allies in its international expansion strategy. In addition to the model it has been fine-tuning for more than 25 years in its existing markets, DIA is also pursuing growth in the franchise segment by means of strategic master agreements with local entrepreneurs under which it grants the latter the exclusive right to use the brand in certain countries or regions.
In vast markets with highly diverse customers and consumer habits, such as Brazil and Argentina, these agreements are essential to supporting the accelerated yet profitable growth equation.
In 2014, DIA entered into a master franchise agreement in Brazil covering franchised store openings in the state of Bahía, which has a population of over 14 million inhabitants. A total of 19 stores were inaugurated under this agreement in 2015, lifting the total to 31.
In Argentina, a similar formula has also been in place in the province of Salta, with a population of over 1.2 million, since 2014; 25 stores have been opened under this master franchise agreement, one of which in 2015.
DIA provides these countries with the ongoing training and support needed to ensure that the operations are developed properly.
DIA sees its private label as the business’s best calling card oversees. To this end it has agreements for the export of its products to 23 countries where it does not have a physical store network; these agreements give it a foothold in these markets and constitute a potential launch-pad for more extensive arrangements in the future.
In 2015, the company bolstered its export effort by introducing English and French onto its packaging.
By licensing its brand to local distributors, DIA has also been pursuing this strategy in Africa using the CityDIA trademark. The company currently has agreements in sub-Saharan Africa (Senegal, Nigeria, Ivory Coast, Guinea Conakry). These stores are directly supervised by the various partners; the company provides the support, know-how and brand equity needed to start up and develop the business in the region in question.