An insight into franchising from a Franchisee's perspective

Written on the 15th of March 2011 by Will Fulton

Buying a franchise is a great step if you are a first time business owner - especially if you’re coming out of a successful job in a similar field to that of your target franchise. That was my motivation for getting in. I also figured it would take way too long to set up endless business systems so why reinvent the wheel? I did very little due diligence prior to getting into ActionCOACH and have some perspective on this approach with the benefit of 5 year’s hindsight!

Here’s what you may want to be thinking about…

A key task as you look at what’s available is to consider how motivated you are towards DOING the work with your target customer base versus FINDING the work from your target prospect base. This distinction between operations and sales is important as you will want to evaluate what systems you will be relying on the most from your franchisor.

It’s sometimes said “your business is about what you are LEAST good at”.  So, if you are fairly outgoing and confident with FINDING work, then have a look at how strong the franchise’s systems are for delivering a high quality product or service to their customers (and any points of difference between them and their opposition). This will be important to you as you find new customers with your sales skills. Sometimes getting customers may be a relatively straightforward process, but customer retention and delivery may be compromised without solid back-up systems.

On the other hand, you may be very confident with the delivery side of your service or product but be less confident about drumming up SALES with your new customer base. If this sounds more like you, then the marketing and sales systems of your target franchise should probably be looked at in more detail. How well and to what extent your franchisor generates leads or clients for you will let you know how reliant you’ll need to be on either them or you.

Talking to other franchisees in the network is another great indicator of life in the system. This is one step I did do before getting into ActionCOACH.  I was already quite keen to join ActionCOACH but talking with others really cemented the decision. Think up some good questions before you phone around.

Overall, I have found that self-reliance is the hallmark of all the best franchisees. Too much reliance on the franchisor breeds a “feed me” mentality; too much dependence on the operator rather than the franchise system can sometimes breed resentment. Do your homework and give yourself enough (some!) working capital to get started.

Best wishes with your decision and back yourself to be the best!

This article was contributed by Will Fulton from ActionCOACH.

Will Fulton has seen the franchise system from many angles. He has been a franchisee with ActionCOACH for 5 years winning many awards including 2007 Australasian Coach of the Year. He’s also a Director of Advanced Cabinet Solutions who licence joiners to manufacture using a unique system for waterproof cabinet construction. He has trained franchisees in all stages of franchise ownership from induction training through to experienced operators. This has taken him to the USA, UK, Ireland, Australia as well as NZ with his training systems. In addition to his franchising activities, he operates an internet company and is a keen property investor.

An insight into franchising from a Franchisee's perspective

Written on the 15th of March 2011 by Will Fulton

Buying a franchise is a great step if you are a first time business owner - especially if you’re coming out of a successful job in a similar field to that of your target franchise. That was my motivation for getting in. I also figured it would take way too long to set up endless business systems so why reinvent the wheel? I did very little due diligence prior to getting into ActionCOACH and have some perspective on this approach with the benefit of 5 year’s hindsight!

Here’s what you may want to be thinking about…

A key task as you look at what’s available is to consider how motivated you are towards DOING the work with your target customer base versus FINDING the work from your target prospect base. This distinction between operations and sales is important as you will want to evaluate what systems you will be relying on the most from your franchisor.

It’s sometimes said “your business is about what you are LEAST good at”.  So, if you are fairly outgoing and confident with FINDING work, then have a look at how strong the franchise’s systems are for delivering a high quality product or service to their customers (and any points of difference between them and their opposition). This will be important to you as you find new customers with your sales skills. Sometimes getting customers may be a relatively straightforward process, but customer retention and delivery may be compromised without solid back-up systems.

On the other hand, you may be very confident with the delivery side of your service or product but be less confident about drumming up SALES with your new customer base. If this sounds more like you, then the marketing and sales systems of your target franchise should probably be looked at in more detail. How well and to what extent your franchisor generates leads or clients for you will let you know how reliant you’ll need to be on either them or you.

Talking to other franchisees in the network is another great indicator of life in the system. This is one step I did do before getting into ActionCOACH.  I was already quite keen to join ActionCOACH but talking with others really cemented the decision. Think up some good questions before you phone around.

Overall, I have found that self-reliance is the hallmark of all the best franchisees. Too much reliance on the franchisor breeds a “feed me” mentality; too much dependence on the operator rather than the franchise system can sometimes breed resentment. Do your homework and give yourself enough (some!) working capital to get started.

Best wishes with your decision and back yourself to be the best!

This article was contributed by Will Fulton from ActionCOACH.

Will Fulton has seen the franchise system from many angles. He has been a franchisee with ActionCOACH for 5 years winning many awards including 2007 Australasian Coach of the Year. He’s also a Director of Advanced Cabinet Solutions who licence joiners to manufacture using a unique system for waterproof cabinet construction. He has trained franchisees in all stages of franchise ownership from induction training through to experienced operators. This has taken him to the USA, UK, Ireland, Australia as well as NZ with his training systems. In addition to his franchising activities, he operates an internet company and is a keen property investor.

Franchising tops $20 billion turnover, 100,000 jobs

12 November 2012 - The contribution of the franchising sector to New Zealand’s economy has reached $20 billion , according to a new study by Massey University. Franchising New Zealand 2012 also estimates that the franchise sector employs 101,800 people.

The second biennial survey of the franchise sector was conducted by Massey University in collaboration with the Griffith university in Brisbane. It found that the franchise sector has shown resilience during difficult economic times, but there is scope for the industry to innovate. Dr Susan Flint-Hartle of Massey says that, on the whole, franchise businesses have been able to increase their levels of turnover, although there have been marginal decreases in size and profitability since the last survey in 2010.

'That is a reflection of the economy – the effect of a very high dollar, rising commodity prices, and the ongoing impact of the global financial crisis and the Canterbury earthquakes.'

Dr Flint-Hartle gave an outline of the survey's major findings at a function in Auckland this evening. The full report will be made available tomorrow, and a detailed review of many of the findings will appear on this site.

• New Zealand has 446 franchise brands.
• Since the 2010 survey there has been a net growth of 23 franchisors.
• There are an estimated 22,400 franchisee businesses operating in New Zealand, making up 5 percent of the country’s small and medium-sized businesses.
• The total number of franchisee businesses has contracted slightly (down 5 percent from an estimated 23,600 in 2010).
• The annual turnover of the franchise sector is estimated to be between $19.4 and $21 billion.
• Over the past two years, the total number of people employed in the franchise sector has increased from 80,400 to 101,800, but almost 10 per cent less are now employed in full-time positions.
• 23 per cent of franchisors have entered international markets, predominantly in Australia.