Tostao’ considers franchising for expansion in Colombia

Tostao’ is considering franchising as part of its next phase of expansion in Colombia. According to a report by L’Express Franchise on developments in Latin America’s franchise community, the coffee and bakery chain is exploring an alternative approach to growth: so far, all its new outlets have been company-owned.

An option under consideration, not a launch

The news concerns a potential change in business model. The available information indicates that Tostao’ is considering franchising for its next phase of expansion, but does not present this as a final decision or an open invitation to investors.

This distinction matters to anyone following new opportunities in Colombia’s franchise market. Exploring a growth model is not the same as offering contracts, accepting applications from prospective franchisees or having franchised outlets in operation.

The excerpt reviewed provides no details of investment requirements, entry criteria, priority cities or an implementation timetable. The research therefore offers no basis for suggesting that Tostao’ has a specific franchise offer or a target number of franchised openings.

For now, the news is that the chain is interested in exploring a different route from the one it has followed to date. Any progress towards a launch will require further information to establish its scope.

From company-owned outlets to a potential new partnership

The key background detail in the published information is that all Tostao’ openings have been company-owned outlets. This explains why its consideration of franchising is significant: based on the available material, the chain is not looking to expand an existing franchise network, but considering whether to introduce franchising as part of the brand’s growth.

When assessing this possibility, it is worth separating two issues. One is the chain’s commercial expansion; the other is the potential involvement of independent operators under franchise agreements. The report raises the second option without specifying how it would work alongside company-owned outlets.

It would be inappropriate to infer that Tostao’ will stop opening company-owned stores, convert existing outlets into franchises or adopt a particular mix of formats. None of these decisions is documented in the excerpt.

From QFA Colombia’s editorial perspective, this is precisely what needs monitoring: whether the review develops into a defined proposition and, if so, what responsibilities the brand and its future franchisees would have.

What a prospective franchisee would need to know

For an interested entrepreneur, this news is a development to monitor, not sufficient grounds for an investment decision. Before assessing any potential offer, it would be prudent to seek direct confirmation that a formal franchise programme exists and is open to new operators.

If the chain does announce a programme, due diligence should cover the total investment required, contractual fees, supply arrangements, training and operational support. These are questions to investigate, not terms announced by Tostao’.

Prospective franchisees should also clarify site selection criteria, the length of the agreement, each party’s obligations, and renewal or termination terms. Without these details, it would not be possible to make an informed comparison between a potential franchise and other business opportunities.

Familiarity with a brand is no substitute for assessing the contract or the financial viability of an outlet. In this case, the available research does not yet include a proposition that would allow such an assessment.

A development to follow carefully

Tostao’s potential entry into franchising deserves attention because it would mark a change from its history of company-owned openings. Its significance, however, does not remove the need to distinguish exploratory interest from an offer that has actually been launched.

The next development to watch for is whether the chain confirms the model and publishes its terms. Until then, it should be described as an option under consideration.

Practical takeaway: if you are interested in a potential Tostao’ franchise, wait for formal confirmation and verifiable documentation before committing funds or comparing investment projections.