Global Business and Finance Global Business Expansion Proposal Orange Leaf Frozen Yogurt’s Expansion in Luxembourg This project is about expanding Orange Leaf Frozen Yogurt in Luxembourg to provide success to the country and franchise by analyzing the country’s indicators and other aspects.

Executive Summary 1 STEPAnalysis 2 Franchise Selection 2 Cultural Analysis 2 Marketing Analysis 2 Financial Analysis 3 Conclusion 4 Appendix 4 Resources 4 Global Expansion in Luxembourg Losciuto 2

Executive Summary The driving question for the project is “How can Orange Leaf expand globally while including economic and cultural challenges and maintaining the mission and vision of the company?” Based on Orange Leaf’s success in the United States, the company will find similar success because of the similarities in culture in Luxembourg. This assignment’s purpose is to expand Orange Leaf globally by analyzing data, its culture, finance, and corporate social responsibility. Luxembourg is located in northwestern Europe and is one of the smallest countries in the world with a total of 2,586 sq km of land. Breathtaking views are what is noticed first along with the country’s mild winters and cool summers. Despite its size, however, Luxembourg is the second richest country in the world and is known for being a European economic powerhouse. Luxembourg also is famous for its award winning wines, especially their white wines. Global Expansion in Luxembourg Losciuto 3

STEPAnalysis The following is a STEP analysis for Luxembourg. It includes social, technological, economical, and political indicators transformed into statements to analyze what it is like to do business in Luxembourg. Luxembourg is known for being an economic powerhouse and having a mass of job opportunities. Overall, Luxembourg is a very developed country with a successful economy and stable political climate. The “social” category of the STEP analysis is what describes a country’s culture the most. Luxembourg’s median age being 39.5 and literacy rate being 100% means that Orange Leaf staff members will be able to read and understand instructions and most will be able to help maintain store cleanliness and keep self-serve areas stocked. Luxembourg is known for its award winning wines so it is no surprise that the country consumes more alcohol than the average country. The alcohol consumption per capita is 11 liters of pure alcohol meaning that Luxembourg consumes more alcohol than most of the world and will enjoy a new menu item that contains wine. With Luxembourg having three official languages (French, German, and Luxembourgish) spoken throughout, language barriers will not be an issue and staff will be able to accommodate customers who come from different backgrounds as Luxembourg is bordered by France and Germany. With business meetings, partners will be able to communicate if they speak one of the three languages. The next category in the STEP analysis is the “technological” category. Luxembourg is known for being an ever evolving and innovating country. With 99% of the population being an internet user, workers will have the skills to complete transactions when customers are Global Expansion in Luxembourg Losciuto 4

purchasing from Orange Leaf and business meetings won’t be held up by a lack of understanding in technology. Luxembourg is landlocked so having lots of transportation is important for a business so consumers and materials can be imported to locations in the country. The country's comparison to the world is 124 and railways stretch 275 km total meaning that importing supplies and ingredients will be efficient. In a world of constant innovation and change, it is important for a country and business to keep up. Luxembourg being ranked 18th out of 129 economies in the Global Innovation Index means that the country is constantly evolving and changing for the better. The “economical” category of a STEP analysis is arguably the most important section to a business. Overall, Luxembourg has a successful economy where companies can grow and find success. Luxembourg is focused on a limited number of agricultural resources including dairy (milk) and grapes which are needed to make frozen yogurt and additional flavors. Luxembourg having an unemployment rate of 4.9% means that there are many people who are willing to work and with 78% of people who are working, working in the service sector of the labor force which means that people will have experience in working in services. The country having a mixed economy will benefit Orange Leaf because the business will have the freedom of making decisions but will face restrictions that will benefit the public and Earth. The last category of a STEP analysis is the “political” category. Luxembourg is known for having a safe and peaceful political and social environment which is good for a business because setbacks of a country's unrest will drag a business down. Luxembourg’s government type being a constitutional monarchy makes for the government being accommodating to free Global Expansion in Luxembourg Losciuto 5

trade and helpful to the needs of businesses. Luxembourg having a stable political framework and one of the lowest levels of public debt means that its government can afford to improve education and public training. This is beneficial to Orange Leaf because it will receive help in training workers. Luxembourg having a reported percentile rank at 94.34% in political stability and absence of violence/terrorism means that the government has more money to spend on benefiting citizens, the economy, and supporting businesses rather than protecting the country from threats. Luxembourg’s indicators show that the country and its economy is fit to house another franchise. The 2x2 STEP analysis is attached in the appendix Franchise Selection The franchise I have chosen to expand globally is Orange Leaf Frozen Yogurt. The company originated in Oklahoma City and was founded in 2008. It has nearly 160 locations in the United States and Mexico. Orange Leaf Frozen Yogurt is a self-serve frozen yogurt restaurant that also offers smoothies, shakes, and cakes where customers pay by the ounce. The company preaches “flavor freedom” and advertises its many options for toppings and flavors. Orange Leaf Frozen Yogurt is an excellent addition to Luxembourg as the country is fond of frozen yogurt and the company and the country share similar priorities and ideas on inclusivity. Orange Leaf’s menu includes vegan and dairy-free options to accommodate people who have dietary restrictions and eco-friendly lifestyles. Including everyone is important to Orange Leaf which will be the perfect fit for Luxembourg as the country is known for having an open society. Dairy products are also one of Luxembourg’s top agricultural products. Global Expansion in Luxembourg Losciuto 6

Because Orange Leaf Frozen Yogurt and Luxembourg have similar morals and ingredients will be available in the country, the franchise will find success and be a good addition to Luxembourg. Cultural Analysis Cultural values in Luxembourg revolve around modesty, friendship, and family. During business meetings and in general, it is taboo to ask personal questions. Despite family driving the culture, personal life rarely interferes with work life. During business meetings, you are expected to dress formally and arrive on time. However, Orange Leaf Frozen Yogurt only has annual meetings and weekly calls for sub-committee members. If you are part of a sub-committee (operations, marketing, technology), you’ll only have to worry about dressing for meetings and getting there on time once in a while. Orange Leaf also advertises their work environment as fun and relaxing. Following this etiquette ensures no social norms will be broken in Luxembourg. Friendship and friendliness drives the work culture at Orange Leaf which are also the same factors that drive the social culture in Luxembourg. Friendly employees matched with customers that appreciate the warm environment will make for a successful addition to Luxembourg’s culture. Marketing Analysis The new item we will be incorporating into the Orange Leaf Frozen Yogurt’s menu is a white wine flavored frozen yogurt. The new item contains white wine and yogurt. These ingredients also happen to be some of Luxembourg’s agricultural products. Since Luxembourg Global Expansion in Luxembourg Losciuto 7

consumes more alcohol than most countries, a white wine flavored frozen yogurt would become successful and popular in Luxembourg White wine flavored frozen yogurt is not as known or widely advertised in other countries so customers will want to try something new. This menu item will add a unique addition to the country and may bring tourists who want to try the treat and boost the already successful economy of Luxembourg. Adding a new flavor of frozen yogurt to the menu and advertising it as such will compel consumers to try it. In addition to the new flavored frozen yogurt, the item containing a popular drink (white wine) will spark interest in the public. A flier is attached to this project in the appendix. Financial Analysis Luxembourg is part of the Eurosystem and has a single monetary policy. The country uses euro banknotes and coins. One euro is equal to $1.06 in the United States. The dollar and euro are very similar in value so there will not be as many marketing hardships. 75 years ago was when the World Bank made its first and only loan to Luxembourg. This loan was to support the country’s economic recovery after WW1 but won’t affect Orange Leaf. In order to be recognised as a franchise in Luxembourg, the business must contain the franchisor and franchisee, a franchise agreement, the right of use over the name of franchisor, and the assistance of the franchisor to the franchisee. The franchisee must also be subject to a fee or to pay royalties to the franchisor for the duration of the use of the brand’s name. In order to open an Orange Leaf franchise, there is a $25,000 franchise fee and 5% ongoing royalties. To add onto that, the average start-up cost for an Orange Leaf franchise is between $189,900 and Global Expansion in Luxembourg Losciuto 8

$417,300. Orange Leaf franchisees also have the freedom of adding a new menu item. Although there are tight rules to follow regarding opening up a franchise in Luxembourg, opening an Orange Leaf franchise will outweigh this process. Corporate Social Responsibility (CSR) Analysis Orange Leaf’s mission statement is, “To make life sweeter by creating a memorable treat experience that is all about you”. Orange Leaf offers vegan and dairy-free menu items which show that the company cares about the environment because having dairy-free and vegan items eliminate emissions of greenhouse gasses and reduce deforestation. This is a small step towards helping the environment but will be combined with Luxembourg’s political commitments to reduce greenhouse gas emissions. The company and country’s efforts to help the environment will create change in the effects of climate change. Orange Leaf offering different menu items for people of different lifestyles also shows that the company is supportive and accepting of inclusivity/diversity. One of Orange Leaf’s priorities in the workplace is making it a friendly and family-like one. Luxembourg is also known for having a very progressive society that accepts everyone and has a culture built on friendship and family. Orange Leaf Frozen Yogurt will settle in just fine and find success in Luxembourg with their priorities and ideas aligning. Orange Leaf Frozen Yogurt also introduced its Generation Original Program which partners with No Kid Hungry, a national nonprofit organization. No Kid Hungry ensures that children have healthy meals and their families know how to cook with the resources they have. This program raises funds to support the organization and reduce childhood hunger in America. Global Expansion in Luxembourg Losciuto 9

Although there are not many hungry people in Luxembourg (hunger statistics for 2019 was 2.50%), Orange Leaf having this program and eventually bringing it to Luxembourg shows that they care about the suffering minority. CEO Reese Travis envisions new Orange Leaf locations in the future; this goal would be fulfilled when Orange Leaf expands to Luxembourg. Global Expansion in Luxembourg Losciuto 10

Conclusion This project’s purpose was to analyze indicators of a country and find a franchise that would benefit by expanding to a new country. I believe that Orange Leaf Frozen Yogurt was the best choice for this country as they’ve found success in the United States, a country with a culture similar to Luxembourg. With Luxembourg being an economic powerhouse, stable environment, and an overall well organized country, the country is appealing to the eyes of a franchise. Although the country is one of the smallest ones in Europe, Luxembourg is one of the wealthiest countries in the world and has visitors that come to view the beautiful architecture and landscape. To add on to its multitude of positive aspects and job opportunities, famous white wines originate from Luxembourg due to the country’s main agricultural product being grapes. The country itself consumes more alcohol on average so, adding a new menu item that incorporates the culture of Luxembourg will appeal to its citizens and bring some semblance of the country to the franchise. Luxembourg being a well developed country also means more economic opportunities and the ability to expand concepts for Orange Leaf Frozen Yogurt, a goal of CEO Reese Travis. With Luxembourg’s flourishing economy and fruitful resources, Orange Leaf Frozen Yogurt will find success expanding globally. Global Expansion in Luxembourg Losciuto 11

Appendix Social: ● Median age is 39.5 years ● Literacy rate is 100% ● Alcohol consumption per capita is 11 liters of pure alcohol ● Official languages are French, German and Luxembourgish Technological: ● Internet users: total is 624,115 (99%) ● Railways total is 275 km. Country comparison to world is 124 ● Luxembourg is ranked 18th out of 129 economies in Global Innovation Index Economical: ● Services dominate the labor force with 78.9% of people working in it. ● Agricultural resources include dairy and grapes ● Mixed economy ● Work permits are not required for employees from the European Union: this increases the ease and speeds up the process of employment Political: ● Government type is constitutional monarchy ● The political framework is relatively stable and has one of the lowest levels of public debt in Europe. ● Luxembourg has a reported percentile rank at 94.34% in political stability and absence of violence/terrorism Global Expansion in Luxembourg Losciuto 12

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Resources Orange Leaf Frozen Yogurt, https://www.orangeleaffranchises.com/assets/images/franchises/2019-ol-franchisee-guide .pdf. Accessed 13 January 2023. Orange Leaf Frozen Yogurt |, https://orangeleafyogurt.com/. Accessed 18 January 2023. Biel, Victor JP. “Luxembourg | History - Geography | Britannica.” Encyclopedia Britannica, https://www.britannica.com/place/Luxembourg. Accessed 13 January 2023. “Franchises - Franchises.” Franchises - Franchises, https://www.orangeleaffranchises.com/why-orange-leaf. Accessed 13 January 2023. “Indicator Rankings & Analysis.” Global Innovation Index, https://www.globalinnovationindex.org/analysis-indicator. Accessed 13 January 2023. “Luxembourg7 Reasons Why Do Companies Set up in Luxembourg.” Tetra Consultants, 4 November 2022, https://www.tetraconsultants.com/blog/companies-set-up-in-luxembourg/. Accessed 13 January 2023. “Luxembourg Hunger Statistics 2001-2023 | MacroTrends.” Macrotrends, https://www.macrotrends.net/countries/LUX/luxembourg/hunger-statistics. Accessed 13 January 2023. “Luxembourg - Political Stability And Absence Of Violence/Terrorism: Percentile Rank - 2023 Data 2024 Forecast 1996-2021 Historical.” Trading Economics, https://tradingeconomics.com/luxembourg/political-stability-and-absence-of-violence-terr orism-percentile-rank-wb-data.html. Accessed 13 January 2023. Global Expansion in Luxembourg Losciuto 14

“Luxembourg's vineyards - small but excellent The Grand Duchy offers a wide range of grape varieties, to suit all tastes.” Luxembourg.lu, 13 April 2021, https://luxembourg.public.lu/en/visit/flavours/vintages-vineyard.html. Accessed 13 January 2023. “Orange Leaf Frozen Yogurt Launches "Generation Original" In Partnership With No Kid Hungry To Help End Childhood Hunger In America.” PR Newswire, 6 September 2016, https://www.prnewswire.com/news-releases/orange-leaf-frozen-yogurt-launches-generati on-original-in-partnership-with-no-kid-hungry-to-help-end-childhood-hunger-in-america300322260.html. Accessed 13 January 2023. Sager, Anna. “24 Things Luxembourg is Known and Famous For.” Hey Explorer, 22 September 2021, https://heyexplorer.com/what-is-luxembourg-known-and-famous-for/. Accessed 13 January 2023. “Social etiquette in Luxembourg: manners and quirks.” Expatica, 21 July 2022, https://www.expatica.com/lu/living/integration/culture-and-social-etiquette-in-luxembour g-106555/. Accessed 13 January 2023. Stanford, Carl. “How Does Government Type Affect My Business?” Fleximize, https://fleximize.com/articles/000604/how-government-type-affects-business. Accessed 13 January 2023. “World Bank and Luxembourg Mark 75 Years of Shared History.” World Bank, 27 August 2022, https://www.worldbank.org/en/news/press-release/2022/08/27/-world-bank-and-luxembo urg-mark-75-years-of-shared-history. Accessed 13 January 2023. Global Expansion in Luxembourg Losciuto 15