Despite a small slump in figures during the Global Financial Crisis, franchising has come out of the mire relatively unscathed and in fact the numbers for franchisors and their franchisees are looking very healthy. TGR looks at what the franchise sector can expect as we embed ourselves in the 21st century.
Many top companies, from Disney to Visa, have hired futurist Jim Carroll to speak about his views on the future. So it is interesting to hear his views about franchising. He told Multi-unit Franchisee, “There’s nothing to fear really, if you view future trends as being full of opportunities rather than as a threat. I find that many of my clients think about future trends and think, ‘Oh, this can’t be good, it’s going to be pretty difficult to deal with.’ The first step with getting into an innovative frame of mind is to think of every trend as an opportunity, not a threat.
“So let’s think about a few of them. Consider social networks; there are huge impacts on how consumers perceive, interact and provide feedback on brands. Obviously, if you don’t pay attention to the trend, it can turn into a big negative for you. But if you get involved, engage the new consumer, and continually experiment with new ways of taking advantage of this new form of interaction, then you are doing the right thing.”
Carroll went on to say that to be successful you must keep up-to-date with current trends.
“There are just so many opportunities to grow the business. We’ve got all kinds of new location-intelligence oriented opportunities – people walking around with mobile devices that have GPS capabilities built in. Think about instant couponing apps that might encourage customers to drop in and purchase something. There are new methods of getting the brand image out there; we’ve seen so many franchise groups with successful viral videos. For restaurant franchisees, there’s the rapid emergence of the new health-conscious consumer and opportunities to reshape the menu to take advantage of that. I look around and I just see a countless number of methods by which a franchisee can run the business better, grow and transform their business. And that’s what innovation is all about!”
In Australia, the outlook is just as optimistic and there are many entrepreneurial franchisors taking this kind of innovative approach that would make Carroll proud. For instance, the Franchise Food Company led by Stan Gordon launched its Gives Back campaign in August 2013. The initiative hopes to help a number of local community groups and initiatives by donating a total of $10,000 to a variety of causes over the next 12 months.
Gordon says the program will provide much-needed support to charities and community initiatives, to help many Australians who have been met with adverse circumstances or might be doing it tough.
“Cold Rock is all about giving people a reason to smile. The campaign is for anyone and everyone who’s working hard to make a difference in their community; whether you’re supporting a local sporting team, raising money for serious illnesses or fighting to save a historic landmark, we want to hear from you so we can help you along the way.”
The unique and inclusive initiative, housed on the Official Cold Rock Ice Creamery Facebook page, offers charities and community groups four opportunities to receive a one-off donation of up to $2,500.
Community groups and individuals are asked to submit an application detailing why they need a helping hand via the Gives Back Facebook Application.
Running over the coming 12 months, Cold Rock hopes to assist a variety of organisations with meaningful donations and build on the strong history of giving that Stan Gordon and Cold Rock has developed through years of community involvement.
It’s a unique use of social media and a great marketing tool, as well as a community initiative.
Meanwhile, the FFC continues to acquire strong franchise brands. The company’s latest acquisition is the iconic Trampoline brand, which fits nicely into the treats niche along with Mr Whippy, Cold Rock, Nut Shack and Pretzel World. FFC is unique, but like any franchise business, systems are crucial and will remain so, no matter how many years we move forward.
Pacific Retail Management is one of the largest franchise companies in Australia, with ownership of Go Sushi, Wasabi Warriors and Kick Juice Bars.
Part of its success is its systems management. Julia Boyd is the project and marketing coordinator. She says, “Pacific Retail has implemented strong operational systems to assist their franchise partners at every stage of training. Travelling operational team members continue to visit all national stores throughout the year and stay for up to a week or more to assist the business. They help to improve sales and are heavily involved with the franchise partners and any issues they may have.
“Support can also come from fellow franchisees in the group who are experiencing the same things and working towards the same goals. When franchisees work together towards a common goal, you can achieve great success and a cohesive team.
“Being part of a franchise network also means assistance and guidance from industry experts with the set-up of the business. This can include help with site selection and brokering of the lease with the landlord; financing through franchisors relationship with lenders and major banks; expedited process from initiation of agreement to store opening; and ultimately the sale of the store including finding a buyer.”
Of course franchising won’t be for everyone. With the advent of social media and vast new ways to reach clientele, the model will become easier to manage and far more sustainable. However there remains a lack of independence.
“Some prospective business owners are put off franchise networks and prefer to remain independent to avoid such established systems with little room for individual creativity, having to adhere to the operating systems in place and the initial payouts including franchise fees and training and marketing launch costs,” Boyd says…
Excerpted from an article originally published in the February/March 2014 issue of Think & Grow Rich Inc. magazine. If you are a subscriber to Think & Grow Rich Inc. magazine, you will receive this article in your February/March 2014 issue of TGR. If you are not a subscriber, click here to subscribe.