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Franchise Brands Find Few Barriers in Sweden

Flag Facts

Blue with a golden yellow cross extending to the edges of the flag, the colors reflect those of the Swedish coat of arms: three gold crowns on a blue field

Location: In northern Europe, between Finland and Norway and bordering the Baltic Sea, Sweden is slightly larger than California.

Language: Swedish (Finnish, Sami, Romani, Yiddish and Meankieli are official minority languages). English is widely spoken.

Total Population: 10.3 million

Capital: Stockholm

Government: Parliamentary constitutional monarchy

Religion: Church of Sweden (Lutheran, 57.6%); others include Roman Catholic, Jewish, Muslim or unspecified (33.5%)

Economy: With a gross domestic product of $537 billion, Sweden’s is the largest Nordic economy, one with a transparent, developed and diversified market with few barriers to entry—and heavy reliance on foreign trade. Even with the COVID-19 pandemic, the government revised 2021 GDP growth estimates upwards from 3.2 percent to 4.7 percent. Sweden’s open market means it’s also highly competitive, and U.S. companies must be aggressive with pricing and terms in order to succeed. Sweden remains outside the euro zone because of a concern that joining the European Economic and Monetary Union would diminish the country’s sovereignty over its welfare system.

News note: With a new surge in COVID-19 infections and as it again imposes business restrictions, Sweden in December said it would enact government support measures for companies that have lost revenue. Bloomberg reported those companies that lose more than 30 percent of revenue are eligible for compensation of as much as 90 percent of fixed costs. A bright spot: Swedish company Hennes and Mauritz—better known as massive fashion retailer H&M—announced sales measured in local currencies matched pre-pandemic levels from September through November 2021.

GDP (official exchange rate): $531.5 billion

Currency: Swedish krona (conversion rate at press time: 1 SEK equals $0.11 USD).

Franchising in Sweden: While interest in U.S. concepts continues to grow, the majority of Sweden’s 800-plus franchise companies are of Swedish origin. Major U.S. fast food brands such as McDonald’s, Pizza Hut and Subway have a presence, along with the likes of Re/Max and 7-Eleven. The retail, hotel, restaurant and service industries present opportunities for American brands, though the Swedish Franchise Association notes the market is competitive. There is no specific comprehensive franchise legislation in Sweden, but under the Swedish Franchise Disclosure Act, a franchisor must provide a prospective franchisee with certain information before a franchise contract is entered into. The legislation covers all franchise contracts in Sweden.

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